COS Weekly Newsletter - Friday, 4 November 2022

The Vancouver Fraser Port Authority (VFPA) has issued a notice of amendment, dated November 1, 2022, to inform members of the public, industry and other stakeholders of proposed updates to our Port Information Guide. The amendments include an Anchorage Code of Conduct that will apply to all anchorages managed by the VFPA and are intended to address the responsibilities of ships at anchor for the purpose of reducing negative social impacts. Content includes guidelines for maintaining an anchor watch, minimizing noise and light pollution, minimizing overside discharges and conditions for waiver of compulsory pilotage in Coastal Waters.  While guidance has been in place, inclusion in the Port Information Guide formalizes the expectations and requires the master and vessel agent to acknowledge compliance with the Code of Conduct. The Chamber of Shipping will be responding to the notice of amendment and we welcome your input.

Predictions that congestion at rail yards in Canada’s interior would ease this month and next are not playing out so far, prompting frustrated importers and forwarders to ask for government intervention. The problems are most pronounced at rail hubs around Toronto and Montreal.  Ocean carriers are struggling to find locations to receive empty containers and trucking groups have also called for government intervention. According to the Canadian International Freight Forwarders Association (CIFFA), the situation has been exacerbated by government efforts to help reduce congestion at west coast container gateways (notably Vancouver), which only served to push the problem to inland rail facilities already struggling to cope with volumes.

The last cruise ship of the Alaska season departed from the Port of Vancouver on November 2nd to complete the cruise industry's return following a two-year hiatus. The Port of Vancouver's season highlights a record 306 cruise ship visits in 2022, an increase of 6% compared to 2019.   While passenger numbers were lower in 2022, as expected, occupancy levels gradually increased throughout the season and are projected to average approximately 70% for the year, an estimate of 815,000 passenger visits compared to approximately 1.1 million in 2019.  

In Prince Rupert cruise tourism regained its footing at the Port of Prince Rupert with a 230 percent increase in cruise passenger volumes versus 2019. Between May 17th and October 3rd, 2022, 40,998 cruise passengers transited through the Port, making it the busiest cruise season in Prince Rupert in over a decade.

In an open letter signed by 32 business associations, the Canadian business community is calling on the federal government to bring public sector employees back to their places of work as rapidly as possible. With inadequate public services regularly failing individual Canadians and businesses alike, the letter urges governments, starting with the federal government, to bring their employees back as quickly as possible. The signatories believe virtual connectivity cannot replace meeting with stakeholders in-person and providing Canadians with the quality of government services that they have the right to expect. They look to the federal government for leadership in bringing public sector employees back.

This week Squamish Terminals celebrated their 50th anniversary.  Squamish Terminals traces its history back to the 1960s, when the extension of the BC Railway to the north and the expansion of pulp production capacity in BC led to the opportunity for the development of a deep water port up the coast from Vancouver.  Robert Cattermole, a prominent forestry executive in BC, made the initial investment to build the first wharf facility on the waterfront. The Training Dyke was built by the community. Cattermole entered into an agreement with Star Shipping in 1971 to expand the wharf development through a joint venture, Squamish Terminals Ltd. The first ship, the Star Columbia, arrived in November 1972 and since then Squamish Terminals has handled more than 22 million tonnes of cargo.

As of November 1st, The Canadian Marine Industry Foundation (CMIF) has officially changed its name to The Canadian Marine Careers Foundation (CMCF). The new title better reflects the organization’s overall mission to promote the diversity of careers within Canada’s marine sector. Replacing the word “industry” with “careers” widens recognition of the foundation’s focus on both the commercial marine sector and marine career opportunities within the public sector. The Imagine Marine brand and digital outreach campaign, which has been operating since 2020, will continue and remain unchanged.

Finance Minister Chrystia Freeland’s second Fall Economic Statement (FES) was delivered in the House of Commons yesterday as Canada faces significant economic headwinds. Statistics Canada reported in mid-October that the Consumer Price Index rose 6.9 per cent in September year-over-year, essentially the same rate as the previous two months, and that food prices grew by 11.4 per cent, the fastest pace in over 40 years.  The fall economic measures total $30.6-billion over six years, with one-third of the spending ($11.1-billion) tied to “making life more affordable.” The “new, targeted” measures, according to the fiscal update “are focused on the Canadians most affected by rising prices.”  Some key commitments announced and included in the Budget Implementation Act (Bill C-32) focus on delivering the recommendations in the National Supply Task Force report such as launching a Supply Chains Regulatory Review to improve the efficiency and resiliency of Canada’s supply chains, modernizing cargo and clearance inspection practices, and streamlining operating policies and regulatory practices that impact the flow of goods through international gateways.

Transport Canada has released Voluntary Guidance for Relevant Authorities on In-Water Cleaning of Vessels. The voluntary guidance outlines best practices that can be used to manage the biosecurity and water quality risks of cleaning vessels’ biofouling in-water.  In the development of the voluntary guidance Transport Canada heard a broad range of perspectives through an extensive engagement process. It is based on the best available knowledge and provides recommendations to relevant authorities, such as ports, on how to safely allow in-water cleaning companies to operate and assess requests to clean individual vessels within their waters.

Mediterranean Shipping Co. filed a motion last week with the National Labor Relations Board urging SSA Marine Inc. to assign cold-ironing tasks at the Port of Seattle’s Terminal 5 to the International Longshore and Warehouse Union. The International Association of Machinists and Aerospace Workers has claimed it’s responsible for those tasks. The dispute in Seattle is among the main reasons that contract negotiations for all West Coast dockworkers have dragged on for months, and the filing is noteworthy because it lays out what’s at stake for MSC. ILWU negotiations representing 22,000 dockworkers began on May 10 and workers have been without a contract now since July 1.

Marine and energy asset owner Atlas Corp. will be taken private after accepting a sweetened $10.9-billion acquisition offer from Poseidon Acquisition Corp. Atlas’ subsidiary Seaspan is the world’s largest containership lessor, operating a fleet of 127 vessels with an additional 63 units under construction. Poseidon Acquisition Corp, is an investment vehicle backed by Fairfax Financial Holdings Limited, the Washington Family, David Sokol, and Ocean Network Express Pte. Ltd. ("ONE"), and other affiliates. Members of the Poseidon consortium already own more than 50 percent of Atlas’s shares. A majority of the minority shareholders must vote to approve the revised offer. The transaction is expected to close in the first half of 2023.

Amendments to the International Convention for the Prevention of Pollution from Ships (MARPOL) Annex VI entered into force on 1 November 2022. Developed under the framework of the Initial IMO Strategy on Reduction of GHG Emissions from Ships agreed in 2018, these technical and operational amendments require ships to improve their energy efficiency in the short term and thereby reduce their greenhouse gas emissions. From 1 January 2023 it will be mandatory for all ships to calculate their attained Energy Efficiency Existing Ship Index (EEXI) to measure their energy efficiency and to initiate the collection of data for the reporting of their annual operational carbon intensity indicator (CII) and CII rating. MSC, among others, is concerned that the proposed methodology for CII calculations could lead to situations in which a vessel’s rating would worsen simply because it spends more time in port.

Pacific Basin Shipping Limited has chosen methanol as the preferred fuel for its first generation of dual-fuel zero-emission newbuildings. In May 2022, the firm entered into a memorandum of understanding with Nihon Shipyard Co., Ltd and Mitsui & Co., Ltd to cooperate on the development of zero-emission vessels and potential investment in related green fuel bunkering infrastructure.  Following completion of a feasibility assessment of the various potential green fuels (covering fuel characteristics, availability and scalability, technical pros and cons, lifetime operating and capital costs, etc.), and Pacific Basin has concluded that green methanol is currently the best fuel around to plan its first generation of zero-emission vessels.

Russia agreed Wednesday to resume its participation in a deal brokered by Turkey and the UN to keep grain and other commodities moving out of Ukraine’s ports during Russia’s invasion of Ukraine. The renewed deal would prioritize shipments to African nations, including Somalia, Djibouti and Sudan, in line with Russia’s concerns that most of the grain exported since the agreement first was reached in July was ending up in richer nations. Russia had suspended its participation in the grain deal over the weekend, citing allegations of a Ukrainian drone attack against its Black Sea fleet.

Ship technology suppliers are aiming to submit a proposal to IMO on improving data sharing to appease growing discontent among shipowner customers. The CIMAC digitalisation strategy group - comprised of representatives from engine manufacturers, component suppliers, engineering companies, classification societies and universities – is developing a position paper to present to the Maritime Safety Committee in 2023, suggesting ways to make greater collaboration feasible to improve safety, efficiency and operational insight for ship owners. Data from ship systems can provide a holistic picture of the vessel, helping operators with everything from reducing emissions to optimizing maintenance and making navigation safer. But often incompatible systems require their own dashboards and analysis, leaving shipowners to work out for themselves how to combine data from multiple sources.

Drewry’s estimated a theoretical officer shortfall, reaching record levels by 2027, with a gap of more than 55 thousand positions representing more than 7% of total demand. While officer-rank seafarer supply growth has remained weak in recent years, averaging annual growth of 0.8% since 2018, demand for more crew is increasing with the global merchant vessel fleet accelerating. Changing patterns in the transportation of oil and gas following the war in Ukraine and the recovery in offshore oil & gas markets have further squeezed seafarer supply. Based on the above trends, Drewry forecasts further tightening of officer availability, which will feed into higher manning and ship operating costs. But the impact will vary by vessel type dependent on their senior officer requirements.

Norway’s Siem Offshore has won a contract from BP Canada for its large platform supply vessel Siem Symphony. The contract will start in the second quarter of 2023 and is expected to keep the 5,500 dwt dual-fuel ship utilized for four to six months. The Siem Symphony was the first ship in the company’s fleet fitted with a battery pack. The 2014-built PSV features a 565 kWh chargeable Corvus Orca Energy unit.

The Oslo-listed Siem Offshore has a fleet of 28 vessels, of which six are PSV. The company logged third-quarter average fleet utilization of 93%, excluding three vessels in lay-up.

Built:     2014
Design:  VS 4411 DF
Class Notation:   1A1 Fire fighter(II) Offshore service vessel(Supply) Standby vessel(S) BIS Clean(Design) COAT-PSPC COMF(C-3, V-3) DK(+) DYNPOS(AUTR) E0 Gas fuelled HL(2.8) LFL(*) NAUT(OSV(A)) OILREC SF
Dp Class:   2
LOA:           89.20 m
Breadth:     19.00 m
Draught:      7.40 m
Dwt:           5,500 t
Accommodation:  25
Cargo Deck Area:   980 m2