China, India increase palm oil imports

Shipbrokers told IHS Maritime that they have been fixing more palm oil cargoes to China and India ahead of the Mid-Autumn Festival on 27 September and Ramadan on 17 July.
In addition, charterers have been hurrying to ship Indonesian palm oil out before the world’s biggest palm oil producer imposes

Asia Readies Particularly Sensitive Area Proposals

By Wendy Laursen 2015-06-25 19:56:38

A project to identify potential sea areas in South East Asia which could be put forward for designation as Particularly Sensitive Sea Areas (PSSAs) is gaining traction with the holding of a second regional meeting in Hanoi, Vietnam, this week.

A PSSA is an area that needs special protection through the action by IMO because of its significance for recognized ecological, socio-economic or scientific attributes that make it vulnerable to damage by international shipping activities.

A PSSA can gain extra protection through global recognition and the adoption of associated protective measures, such as ship routing systems. States can propose areas to be avoided or set up shipping lanes so that the risk of collision is diminished.

One area being considered is the Tubbataha Reefs Natural Park, a World Heritage Site which lies in close proximity to international shipping routes in the Sulu Sea, located between the islands of the Philippines and North Borneo.

The Tubbataha Reefs area contains roughly 10,000 hectares of coral reef, and are a major component of the Coral Triangle – the global centre of marine biodiversity. Since the 1980s, marine scientific research has revealed that the area hosts 360 species of corals representing 80 out of the 111 genera known in the world, over 600 species of fish, 12 species of sharks, 13 species of dolphins and whales and 100 species of birds.

Six seabird species have breeding grounds on two islets in the park. Its sandbanks are also nesting grounds of endangered hawksbill and green sea turtles. The area also hosts the Reef Manta Ray, a species listed as “vulnerable” in the IUCN Red List. In total, 181 species of marine organisms found in the park are listed as threatened or near threatened by the IUCN.

Available data from international sources indicates that more than 900 ships of all types pass through the Sulu Sea and within 40 nautical miles of the park annually. Park rangers have documented marine pollution of various forms continually affecting the reefs. Oil spills and tar balls from passing ships have been observed, and marine debris ranging from plastic food wraps, to fishing lines, to abandoned cargo are collected by the rangers regularly.

These impacts from shipping are in addition to stresses such as foreign and local poachers, infestation of the crown-of-thorns starfish and climate change which is inducing changes in water temperature and acidity, resulting in coral bleaching events.

Other areas being considered are Pulau Kukup (Kukup Island) and Tanjung Piai (Cape Piai) National Parks at the southern tip of Peninsular Malaysia which are considered to need protection from increasing pressures associated with international shipping in the Straits of Malacca and Singapore.

IMO’s Ed Kleverlaan facilitated the meeting which was held under the auspices of a co-operation agreement between IMO and the Norwegian Development Cooperation Agency. The meeting was attended by around 20 participants from Indonesia, Malaysia, Philippines, Singapore and Vietnam.

PSSAs are historically designated by the Marine Environment Protection Committee (MEPC) as one of the main concerns is protection from oil spills. However, any accident could lead to pollution or damage including containers that could be hazardous or harmful to marine life.

While the process of PSSA designation is undertaken by MEPC, any associated protective measures like ships routing are adopted by the IMO Maritime Safety Committee.

The meeting this week follows another held last year, and submissions for Asian PSSAs are progressing. A timeframe for the PSSA proposals and adoption has not yet been made public.


Myanmar Jails Captain and Crew for Human Trafficking

By Wendy Laursen 2015-06-25 19:19:28

A court in Myanmar has convicted 20 crew members of violating the country’s immigration act in relation to human trafficking. The men were on a ship, found off the country’s coast in May, carrying 208 migrant workers, reports Voice of America.

The crewmen, including the Thai captain, were each sentenced to five years’ prison. The charges relate to entering the country illegally, and the men are yet to face further charges specifically relating to human trafficking offences.

The migrants on board had reportedly been imprisoned in horrific conditions at sea for three months. Most were from Bangladesh and some claimed to have been kidnapped and sold to human traffickers.

The vessel was destined for Malaysia or Indonesia but was intercepted by the Myanmar navy off the coast in Maungdaw after it changed course to avoid naval patrols in the Strait of Malacca.

Thousands of migrants were stranded at sea this year after Thailand began a crackdown on smuggling gangs.


Transforming Business, Changing the World

By MarEx 2015-06-25 18:51:02

Sustainability is now firmly on the global business agenda, but there is an urgent need to turn words into action. This is a key conclusion in the independent report; “Impact – Transforming Business, Changing the World” prepared by DNV GL on behalf of the United Nations Global Compact.

The report concludes that the U.N. Global Compact, as the world’s largest corporate sustainability initiative, and the business community have had an impact on the development of sustainability over the past 15 years.

Recommendations that must be implemented to accelerate progress towards a more sustainable future are also highlighted in the report.

“Our assessment shows there has been a clear shift in sustainability development, but in the future the necessary transformative change will only become a reality if we are all able to speed up, scale and strengthen our efforts. It’s not sufficient that business alone is mobilizing. We must therefore offer arenas for collaboration, including for policy makers, science professionals and society at large,” says Dr Henrik O. Madsen, Group President & Chief Executive Officer at DNV GL.

“This report confirms that the tide is turning in corporate practices. Over the past 15 years, companies around the world have been awakening to their role in society and starting to make important strides to operate more responsibly and innovate for a greener, more sustainable future. But there is still a long way to go, and the UN Global Compact remains strongly committed to mobilizing business everywhere to be a force for good,” states Georg Kell, UN Global Compact Executive Director.

Significant changes we have seen over the past 15 years (report findings):

• Sustainability is gradually penetrating deeper into markets and sectors all around the world. Global Compact signatories are present in 156 countries, and 25% of the world’s largest companies have joined.

• A deeper understanding of the complexity and interdependence of global challenges has emerged. Partnership and collaboration are the new norm.

• More sustainability issues – equality, climate change and corruption – are now on the corporate agenda because they impact performance.

• Business has become more strategic, systematic, integrated, transparent and collaborative regarding sustainability.

• Leading companies are ahead of regulation and drive the debate to make regulations smarter. Yet these companies are in the minority, and less progressive companies are blocking positive change.

• The financial sector shows positive developments – through its support for the Principles for Responsible Investment, rapid development of green bonds and Sustainable Stock Exchanges Initiative.

• The local Global Compact networks are very effective in engaging local businesses around the issues that are important for that particular country or region.

• The jury is still out on whether a sustainable and inclusive economy will be achieved. But the UN Global Compact has undoubtedly helped to change the understanding of corporate responsibility all around the world.

• Some companies are talking about a “net zero footprint” in terms of carbon, water and waste, and some leaders have established concrete goals for reaching zero footprint levels. This is highly promising and such companies will get many followers.

• Leading companies are also beginning to look for ways to turn sustainability risks into new business opportunities.

Key changes we need to see over the next 15 years:

Dr Madsen continues “If we want to see radical transformation, probably even creative destruction, change will need to happen simultaneously across all of three interconnected pathways towards 2030.”

• “Sustainability is the business of business” – we need to mobilize the vast majority of companies. Sustainability must be part of daily business – embedded in our business models and long-term goals and making sure we add value to society.

• “Breaking down barriers, energizing positive drivers” – how we can enable conditions to speed up change. It is a matter of better and smarter governance and regulations. Providing the right directional support and shifting investor practices.

• “New thinking for a new reality” – changes will come. We should inspire change by showcasing new business opportunities and sustainable solutions. And we should demonstrate that business is ready for the transformation.

Most important measures for fast mobilization:

Dr Madsen points out: “I’m certainly optimistic about the willingness of business to be a partner in solving the serious problems of today’s world and to lead us onto a sustainable pathway. Our assessment shows that most business leaders now have sustainability on their agenda. However, there is still the question of whether we can mobilize fast and broad enough. We therefore endorse the following measures:”

• The business sector can like no other contribute human and financial capacity, technology and innovation and should step up the efforts.

• Progressive companies are already urging governments to enact policies that support sustainable business practice. One example is to establish a price on carbon – regionally or globally. This would be a powerful signal.

• Responsible investment is another key measure. We should also stop absurd and detrimental subsidies that hinder progress.

• Gender equality is a critical part of the solution. We will see a multiplier effect if we invest in women’s education and economic empowerment and in securing women’s rights.

• Leaders across all domains must take responsibility for steering the world towards a resilient, stable and equitable future.

“Finally, we must commit to co-investing in the societies in which we operate. This also entails paying taxes to the communities where we operate and make our profits and stopping any offshoring of environmental and social responsibilities to less regulated markets. With this, we can begin to demonstrate true business statesmanship,” concludes Dr Madsen.

The report is available here.


Dry Bulk Market Gaining Momentum

By MarEx 2015-06-25 14:25:53

The dry bulk market has been devastating so far in 2015. However, June has somehow reversed it all in less than three weeks if judged by the Baltic Dry Index (BDI).

June has delivered what May was unable to – keeping the momentum going. Since the drop in January, we have seen the BDI average at 576 for the four months of February to May.

In contrast to that the BDI stand at 829 on 24 June 2015.

According to data from Commodore Research, Chinese iron ore fixtures hit an all-year-high in mid-May. Most of it naturally came from China’s main supplier Australia, but the demand was supported by an all-year-high level of shipments out of Brazil too. Since then Capesize earnings lost some ground only to come back with a vengeance as more shipments were coming out of Brazil and Australia again. The weekly number from Brazil went up by 45% when comparing the time up-to mid-May with the following weeks.

Chief Shipping Analyst at BIMCO, Peter Sand, Says: “We have seen the BDI constantly go higher since end-May. Chinese iron ore fixtures has been on a slow but rising trend throughout the year, so what we are seeing now has been a long coming.

But this is not all about the demand side, the lift would not have been possible without the support coming from a decreasing Capesize fleet size. Since we entered into 2015 the Capesize fleet is now short of 22 ships equal to a drop in capacity of 0.7%

The BDI is lifted on the back of stronger Capesize earnings which has more than doubled during the month of June. Panamax earnings also improved significantly since late May.

“As we have said before, BIMCO do expect rising volumes as the year progresses which should support the market if the supply side also contributes with limited fleet growth. In spite of the most recent development the market is still moving forward on fairly thin ice”, adds Peter Sand