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Hapag-Lloyd invests in growing East African market

New service allows carrier to handle more shipments of export cargo and import cargo in international trade.

Hapag-Lloyd invests in growing East African market

Hapag-Lloyd is continuing to focus on the growing market in East Africa. With annual growth rates of six percent, the region tops the list on the African continent. Kenya, in particular, is developing with significantly rising import and export figures as well as massive investments in public infrastructure.

In April 2018 Hapag-Lloyd launched the East Africa Service (EAS), its first dedicated service to East Africa. The weekly service sails from Jeddah to Mombasa, and from there to Dar es Salaam, in Tanzania, and directly back to Jeddah. After a successful start this service will be expanded in September with a weekly connection to and from Nhava Sheva, Mundra, Khor Fakkan, Jebel Ali, Mombasa, and Dar es Salaam. The so called EAS2 will replace the current EAS service and directly link the Arabian Gulf and the West Coast of India with East Africa.

Hapag-Lloyd also offers inland transportation to and from East African hinterland locations of Bujumbura (Burundi), Kigali (Rwanda), Lubumbashi (Democratic Republic of Congo), Lusaka (Zambia) and Kampala (Uganda).

The carrier’s East Africa Service from and to Kenya is developing positively, noted Dheeraj Bhatia, Managing Director Africa, Middle East and Indian Subcontinent for Hapag-Lloyd AG. “After only four months in operation, we have significantly expanded our business with overall vessel utilization beyond our expectations,” he said. “With our upcoming new EAS2 service we will be able to offer even better connections from and to East Africa. All in all we are experiencing growing client demand which demonstrates the economic potential of Kenya.”

The GDP of Kenya has grown significantly in the last two years, rising by an average of approximately six percent. Kenya primarily exports coffee and tea, but also vegetables, fruits and textiles. The main imports are vehicles, spare parts, yarns, machines and electronic goods.

Dealing with disruptions are important for businesses with shipments of export cargo and import cargo in international trade.

Four ways businesses can survive disruptions beyond your control

Business plans—like all plans—can go awry when events beyond the control of the business owner disrupt the everyday routine. Such disruptions could be because of a dip in the economy, a natural disaster that creates havoc, a shift in the public’s buying habits, or new technology that can do what you do better.

“Interruptions within a business are as much a part of life as breathing and blinking,” said Raméz Baassiri,  author of Interrupted Entrepreneurship: Embracing Change in the Family Business. “They are viewed by some as hiccups, challenges, or even crises.”

Baassiri, a board member of AHB Group, a multinational and multigenerational family business, says such moments can prove deadly to a family business, which about 80 percent of all businesses in the United States are. But those disruptions also can be the catalyst for even greater success, depending on how they are handled.

He says a few things family businesses can do when life upends the daily routine include:

Don’t just adapt to change, embrace it. “Every family business has dealt with and will deal with interruptions, from the expected changes and challenges of growth to the unexpected interruptions resulting from loss and poor decision-making, and everything in between,” Baassiri said. “You must be ready to accept and even embrace such changes as they come, to get creative with them and use them as a catalyst for improvement.”

Find your Mass Transformative Purpose. Think about the way in which your company plans to change the world. In other words, why does your business exist? “Knowing that can help you stay focused and overcome seemingly impossible obstacles when they arise,” Baassiri said. “The first time I was asked what our family business’s main purpose was, I replied that it was to ‘stay united as a family with a purpose.’ But the more I thought about it, the more I realized that our purpose isn’t just about family; it’s more than that. It’s to be good citizens, contribute to society, and create educational opportunity. We strive to work hard to achieve great things so that we will be able to give back to society.”

Turn challenges into opportunities. Missed opportunities and failures to turn interruptions in entrepreneurship into positive change abound in the business world. One famous example is how Blockbuster turned down the purchase of Netflix in 2000 for $50 million. Netflix was valued at more than $32 billion only 15 years later. “As much as we may tell ourselves that we need to think beyond how well our company is doing today and plan for future opportunities, it’s much easier to stick with the path that we’re familiar with,” Baassiri said. “Disruption is uncomfortable, but it’s necessary if we’re going to evolve.”

Hire a diverse team for your business. “You can get stuck in your comfort zone because you see the same things every day and revolve in the same circles,” Baassiri said. “You need an extra set of eyes looking at the company from other angles and letting you know where your weak links are and where you can grow. Of course you won’t always agree, but that’s healthy; it means you’re being challenged.”

“Controversial thoughts are where innovation thrives,” he added. “They were the origin of the telephone and the car, the airplane, and spaceships. By asking questions, by thinking beyond the given and looking at the possible (or even the impossible), we grow, and in growing, we thrive despite the disruptions.”

Commerce Department has imposed countervailing duties on shipments of export cargo and import cargo in international trade.

US issues preliminary CVD on imports of laminated woven sacks from Vietnam

The US Department of Commerce has announced the affirmative preliminary determination in the countervailing duty (CVD) investigation of imports of laminated woven sacks from Vietnam, finding that exporters received countervailable subsidies ranging from 3.24 to 6.15 percent.

The Department of Commerce will instruct US Customs and Border Protection to collect cash deposits from importers of laminated woven sacks from Vietnam based on these preliminary rates.

In 2017, US imports of laminated woven sacks from Vietnam were valued at an estimated $21.1 million.

The petitioners are the Laminated Woven Sacks Fair Trade Coalition and its individual members, Polytex Fibers Corporation of Houston, Texas, and ProAmpac Holdings Inc. of Cincinnati, Ohio.

Foreign companies that receive financial assistance from foreign governments that benefits the production of goods from foreign companies and is limited to specific enterprises or industries, or is contingent either upon export performance or upon the use of domestic goods over imported goods, are subject to countervailing duties.

Antidumping and countervailing duty laws provide American businesses and workers with an internationally accepted mechanism to seek relief from the harmful effects of the unfair subsidization of imports into the United States. Commerce currently maintains 456 antidumping and countervailing duty orders which provide relief to American companies and industries impacted by unfair trade.

Since the beginning of the current Administration, Commerce has initiated 120 new antidumping and countervailing duty investigations – this is a 216 percent increase from the comparable period in the previous administration.

Commerce is currently scheduled to issue its final CVD determination on or about December 17, 2018. If Commerce makes an affirmative final determination, the US International Trade Commission (ITC) will be scheduled to make its final injury determination on or about January 31, 2019.  If Commerce makes an affirmative final determination in this investigation and the ITC makes an affirmative final injury determination, Commerce will issue a CVD order.  If Commerce makes a negative final determination or the ITC makes a negative final determination of injury, the investigation will be terminated and no order will be issued.

Inland waterways transit shipments of export cargo and import cargo in international trade.

New Maritime Administration resources for Paducah, Kentucky

United States Secretary of Transportation Elaine L. Chao has announced that the Maritime Administration (MARAD) will establish a new, dedicated Gateway office in Paducah, Kentucky. Gateway offices provide assistance to public ports and state and local officials in addressing transportation congestion relief and improving freight and passenger movement.

The new location and resources will allow MARAD to expand in the area around the Paducah hub, and be better able to support the Inland Marine Transportation System, its ports, service providers and vessel operators. Paducah’s proximity to three major river confluences will support stakeholders working to create a strong transportation network on our inland waterways.

“The Paducah-McCracken County Riverport is a multi-modal center, with waterway, rail, and road connections, and with this level of maritime activity, it makes sense to place a Gateway office in Paducah,” said Chao. “This new Gateway Office will support Paducah’s important role as an inland waterway crossroads between the Tennessee, Ohio, Cumberland and Mississippi rivers, as well as a major dry dock center.”

MARAD has nine other Gateway offices in proximity to the nation’s largest ports. The Gateway offices were established to act as liaisons between maritime communities, state and local authorities and their federal counterparts to identify intermodal challenges and solutions and assist in identifying Federal and state funding opportunities.

“Enhancing MARAD’s impact nationwide is critical for the continued success of the maritime industry,” said Maritime Administrator Mark H. Buzby.

The Inland Waterways Gateway Office in Paducah will have an area of responsibility which includes all or portions of the following Kentucky-adjacent states: West Virginia, Ohio, Indiana, Illinois and Tennessee. The Paducah office will also provide support to MARAD’s St. Louis Gateway Office for the states of Arkansas and Oklahoma.

#PL will move automotive shipments of export cargo and import cargo in international trade.

Leading international automotive logistics provider in China partnership

Kuehne + Nagel announces a partnership with Sincero, a Chinese automotive logistics group with a nation-wide operation coverage, to invest in a joint venture focusing on contract logistics for the automotive sector. Kuehne + Nagel will hold majority share of the joint venture.

In recent years, Kuehne + Nagel has been developing a strong automotive footprint in the country by organically expanding the partnership with premium European brands. The company will now enlarge this footprint by almost seventy per cent serving major Chinese brands and Tier 1 suppliers.

“Contract logistics for the automotive industry is a strategic focus area for Kuehne + Nagel globally and especially in China, the biggest automotive market,” said Gianfranco Sgro, member of the managing board of Kuehne + Nagel International AG, responsible for contract logistics. “The joint venture confirms Kuehne + Nagel’s position as a leading international provider of automotive logistics in China. Following the recent launch of our digital platform for e-fulfilment centres in China this investment further strengthens our presence in Asia.”

“Establishing the joint venture with Kuehne + Nagel is a strategic move to comply with the irreversible globalization trend of economics and competitive landscape of the automobile logistics industry, thereby to complement each other’s strength in global network and local expertise,” said Jiang Jun, Sincero’s chairman of the board.

Both parties agreed not to disclose the purchase price. The joint venture is subject to customary closing conditions and to clearance by the competent merger control authorities.

New APL service carries shipments of export cargo and import cargo in international trade.

APL’S Eagle Express X makes first arrival at Port of Los Angeles

Officials from the Port of Los Angeles and APL welcomed the first arrival of APL’s new premium cargo delivery service, Eagle Express X (EXX). The new weekly China-to-Los Angeles ocean freight service provides faster, expedited transit for cargo owners looking for a more on-time, speed-to-market delivery option.

Features of the Eagle Express X service include time-guaranteed transit from China to Los Angeles — 11 days from Shanghai and 12 days from Ningbo with attractive origin cutoffs and 100 percent guaranteed space and equipment.  When EXX inbound containers are discharged at the Eagle Marine Service (EMS) terminal at the Port of Los Angeles, they are immediately loaded onto specially reserved smart chassis and directly parked in a dedicated EXX yard within the terminal for same day availability. Exclusive EXX gates have been established and no appointments are necessary.

“The Eagle Express X is yet another way that we are responding to the evolving needs of our cargo customers,” said Gene Seroka, executive director at the Port of Los Angeles.

The service is supported by APL’s White Glove Customer Service teams in Asia and Nashville for its North America customers.

“APL is always looking for ways to provide differentiated services for our customers,” said Ed Aldridge, president of APL North America. “The Eagle Express X (EXX) is our new initiative which provides our valuable customers with a cost efficient air freight alternative for its urgent cargo and a first class service for its ocean shipments from origin to destination. The customer support for this new expedited service has been both exceptional and exciting.”

The EXX service will soon benefit from new technology used at the Port of Los Angeles. Developed in partnership with GE Transportation, the Port Optimizer is a first-of-its-kind cloud-based portal that digitizes maritime shipping data for cargo owners and supply chain stakeholders through secure access channels. The technology platform greatly improves goods movement, predictability and planning.

Demand for natural gas in the EU will impact shipments of export cargo and import cargo in international trade.

Natural gas in Europe’s electricity sector

The developments underway in Europe’s natural gas sector are some of the most influential and closely watched in the global gas market. In the past decade, Europe has seen significant demand swings, falling domestic production, growing concerns about dependence on Russian gas, and the advent of US liquefied natural gas exports to the world. Just as important has been the emerging competition from renewable fuels. Indeed, questions are now arising about whether Europe needs new investments in natural gas infrastructure or if those investments would become stranded assets.

In a new paper from the Columbia University Energy Policy Center, an analysis is presented for the outlook for natural gas in Europe’s electricity generation, the most substantial market for gas in the continent, to 2030. The authors create various scenarios that make increasingly bold assumptions about the costs of renewables going forward while at the same time addressing the absence of balancing costs of intermittent renewables in most recent analyses. The paper assumes a robust average carbon price over the forecast period in two of its scenarios, noting the highly complicated politics around more ambitious carbon pricing. Finally, the authors include all planned phaseouts of existing thermal generation capacity, per the reference case of the EU Energy, Transport and GHG Emissions Trends to 2050 as well as all recent national announcements concerning nuclear and coal phaseout.

The paper finds that a renaissance of natural gas in the EU-28 electricity sector looks unlikely, with only modest room for fuel switching and growth—about 40 billion cubic meters (bcm) on a continental scale through 2030. Fuel prices, carbon prices, and interest rates will be critical factors in determining whether demand for natural gas increases or declines.

The paper also found that there is moderate room for carbon pricing to drive fuel switching across Europe, similar to the experience in the United Kingdom. However, to allow for fuel switching, existing underutilized generation capacity must be available to use. If not, utilities face serious questions related to the cost of new generation capacity, anticipated fuel costs and cost curves, and time horizons. Importantly, recent data suggest that even though the carbon price floor did provide an incentive for incremental gas-fired power generation in the UK, soon thereafter, renewables, storage, and efficiency eroded some of the gains made by natural gas.

Increasing natural gas demand for electricity generation is most promising for southern Europe, chiefly because electricity demand in this part of the continent is still growing, although competition from renewables here is fierce. In a scenario with high carbon prices and high natural gas prices, by the end of the forecasting period, investments in renewables make more economic sense than natural gas in the southern part of the European Union. The costs of capital are likely going to be critically important in the coming years to determine whether investors turn to renewables or (in part) natural gas.

The paper concludes that new EU investments in gas infrastructure are probably necessary in parts of the European Union. New investments are less necessary in more mature parts of the continent relative to the less-developed parts of the continent, where gas demand has room for growth and/or single source dependency concerns trump basic economic considerations.

Trump has imposed tariffs on steel and aluminum shipments of export cargo and import cargo in international trade.

Century Aluminum restarts Kentucky smelter

Century Aluminum, the largest primary aluminum producer in the United States, announced the ceremonial restart of its smelter in Hawesville, Kentucky, that will return the facility to full capacity, create 300 new jobs by early next year, and result in the investment of more than $150 million in the local economy.

The ceremony marked the return to full production of the first of three production lines to be restarted at the smelter, which has already hired more than 125 new employees since the announcement of the Section 232 tariffs in March 2018. Commerce Secretary Wilbur Ross joined Michael Bless, CEO of Century Aluminum, at the ceremonial opening.

“The Trump administration’s trade policies have provided much needed relief to America’s primary aluminum workers – leveling the playing field and ensuring that the US primary aluminum industry maintains its competitiveness on the world stage,” said Bless. “Today’s restart will allow us to return to 100-percent capacity in the months ahead while upgrading our smelting technology to ensure we remain competitive long into the future. We want to publicly thank President Donald Trump and Secretary Ross for their leadership on this issue.”

“The aluminum sector has weathered the hardships caused by unfair foreign trade practices,” said Wilbur Ross, the US Secretary of Commerce. “For too long, the government ignored repeated warnings of the impact on the US aluminum sector and its ability to support our armed forces. President Trump’s initiatives are addressing the very problems previous leadership failed to confront with the urgency that these threats presented. This administration remains steadfast in our Made-in-the-USA commitment.”

“Century’s products coming out of Hawesville and Sebree are in demand in Kentucky, across the United States, and around the world,” said Kentucky Governor Matt Bevin. “There is no better place in America to produce high-quality aluminum, and we’re delighted to see the Century facility operating at full capacity and bringing hundreds of jobs back to the local community.”

A major driver of local economic growth, Century Aluminum will invest nearly $150 million in the facility to upgrade smelting technology, train existing employees to use new equipment, and add specialty positions, including welders, mechanics and engineers. For the past three years, the Hawesville smelter has operated at just 40 percent capacity. With today’s restart, the facility will return to full production and add nearly 300 jobs by early next year.

Century’s Hawesville smelter produces aluminum that supplies the defense and aerospace industries, with a majority of Hawesville’s production lines configured to produce military-grade aluminum, making the smelter the largest producer of military-grade aluminum in North America. Hawesville was one of the many smelters forced to curtail operations in late 2015 as global aluminum overcapacity devastated the US primary aluminum industry, threatening American national security and leading to the loss of thousands of American primary aluminum jobs.

Trump has imposed tariffs on Chinese shipments of export cargo and import cargo in international trade.

Freedom Partners: Administration’s tariffs a self-destructive policy

The United States Trade Representative’s (USTR) in August held a comment period and public hearings on the administration’s proposal to levy additional duties on Chinese goods. The proposal would increase the tariff on Chinese imports from 10 to 25 percent on $200 billion worth of imports.

Freedom Partners Executive Vice President Nathan Nascimento termed the administration’s tariffs “a self-destructive policy threatening to undermine the tremendous growth our economy experienced in the past two years.”

The news from around the country has not been good. Brinly-Hardy Co., a Jeffersonville, Indiana-based company that manufactures lawn care accessories, laid off 75 employees in response to Washington’s tariffs. Coca-Cola CEO James Quincey announced recently that the company would be raising prices. Though the additional cost on each can of Coke may be small, the costs add up for the company.

A Missouri-based nail company Mid Continent Nail Corp. has seen the prices of raw materials imported from Mexico increase by 25 percent. Nails now cost more, which has turned away customers. Lower revenue has resulted in 60 layoffs at Mid Continent, with the potential for hundreds more.

Tariffs have also cost significant revenue to Little Bay Lobster Co. of New Hampshire. The company had been shipping more than 50 percent of its lobsters to China, about 50,000 pounds a week. But that came to a crashing halt when China imposed a 25-percent tariff on US lobster.

Nascimento urged the administration not “to accelerate this trade war,” and to work “with trading partners like China to protect intellectual property.” He added: We’re encouraged by news that leaders from Beijing and Washington are meeting to re-start a trade dialogue. Ultimately, that is a better path to create more American jobs and achieve tariff-free trade than a trade war.”