COS Weekly Newsletter - Friday, 20 December 2019


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          COS Weekly Newsletter
          Friday, 20 December 2019




Local News


Northern orcas eating chinook salmon that sustain SRKW

Northern orcas and Alaska residents may be eating up the best quality chinook salmon before they make it to the feeding grounds of the endangered southern resident killer whales (SRKW) in the Salish Sea. New research shows that each year these top ocean predators consume more than 2.5 million adult Chinook salmon along the West Coast. Except for the endangered southern resident killer whale (SRKW) population, all other fish-eating orca populations that live along the coast, called “residents,” are growing in number. There are approximately 300 northern resident killer whales and 2,300 Alaska residents, about three times as many as 30 years ago. The study also suggests that the declines in the body size of Chinook salmon over the past 50 years can be explained by intensified predation by growing populations of resident killer whales that selectively feed on large Chinook salmon, thus revealing a potential conflict between salmon fisheries and marine mammal conservation objectives.

The Ocean Cleanup plastics landed in Vancouver

The Ocean Cleanup brought the results of its first mission in the Great Pacific Garbage Patch into the Port of Vancouver last week. The mission was to develop and prove the capability of a passive cleanup system that can move with the currents and tolerate significant wave heights. The system proved its ability to gather plastic debris in massive ghost nets down to microplastics one millimeter in size. The sixty cubic-metre bags filled with plastic trash ranging from toothbrushes to fishing nets recovered and landed in Vancouver will be transformed into sustainable products that will be sold to help fund the continuation of the cleanup operations. Dutch inventor Boyan Slat, who founded the Ocean Cleanup at the age of 18, is already working on the next system which will be full scale and fully operational with long term durability and retention capability.

CIFFA seeks oversight on detention and demurrage

The Canadian International Freight Forwards Association (CIFFA) has submitted a letter to the Minister of Transport in support of FIATA’s submission to the US Federal Maritime Commission’s (FMC) review of container detention and demurrage charges dated November 7, 2019.  FIATA supports a more transparent, equitable and business orientated process in the determination and levy of such charges not only in the US but in other economies where industry operates under similar processes. In its letter, CIFFA questions how the determination of detention and demurrage facilitates the orderly movement of containers and offers to help facilitate the development of a transparent and collaborative set of service standards to avoid delays and costs in Canadian ports.

FPT Agriculture Ministers' meeting leaves farmers disappointed

Canola farmers across Canada are disappointed that this week’s federal, provincial, and territorial (FPT) Agriculture Ministers' meeting, concluded with the Ministers deciding that more study is needed to improve business risk management (BRM) programs, rather than implementing well-known, tangible steps that will adequately support canola farmers. For years, the AgGrowth Coalition has been asking the FPT Ministers to implement several action items, including increasing AgriStability coverage as current coverage levels are no longer adequate.




Court reserves decision on challenge to Trans Mountain

A panel of judges reserved its decision this week after hearing arguments from four indigenous groups that the Canadian government had failed to properly consult them on expanding its oil pipeline. Their concerns include possible oil spills and threats to endangered southern resident killer whales. Lawyers for the Canadian government has asked the Federal Court of Appeal to dismiss the legal challenge as they feel the consultations where reasonable, adequate and fair and not to quash the entire project again.

Ministers mandate letters released

Last Friday, the federal Ministers’ mandate letters were published with no real surprises or change in direction but with perhaps greater emphasis on the Reconciliation Framework Agreement and completion of the Trans Mountain Pipeline expansion. Work will continue under the Oceans Protection Plan with targets to conserve 25 percent of Canada’s oceans by 2025 and 30 percent by 2030. Under the Transport Minister’s letter, ongoing efforts to review and modernization legislation and regulations continue with emphasis on completing the Ports Modernization Review with an aim to update governance structures that promote investment in Canadian ports. The Treasury Board has been charged with working with Cabinet colleagues in improving transparency, reducing administrative burdens in an effort to harmonize regulations that maintain high safety standards and improve the competitiveness of Canadian businesses.

Competition Bureau challenges P&H acquisition

To protect competition for farmers located near Virden, Manitoba, the Competition Bureau is challenging Parrish & Heimbecker’s (P&H) recent acquisition of a primary grain elevator in that area from Louis Dreyfus Company (LDC) and is requiring that P&H sell either its own elevator in Moosomin, Saskatchewan or its newly acquired elevator in Virden, Manitoba. Prior to the sale, the two elevators closely monitored each other’s wheat and canola prices and responded to competitive activity from each other by offering farmers better prices. The acquisition eliminates this rivalry and as a result, it is anticipated that farmers in the corridor between Moosomin and Virden will earn less for their wheat and canola. The Bureau’s application is available on the Competition Tribunal’s website.

Strategic assessment for thermal coal mine projects

The Government of Canada has announced that it will launch a strategic assessment to provide guidance on how future new thermal coal mine projects will be assessed under the Impact Assessment Act. The strategic assessment will include, but not be limited to: environmental and health impacts of thermal coal mining; market analysis of projected demand for thermal coal, including economic impacts and impact on jobs in Canada; and the use of thermal coal mining, including its impact on Canada’s international commitments and initiatives. Draft terms of reference for the strategic assessment of thermal coal mining will be available online for public comments early in 2020.

Canada and US enter MoU on supply chain for critical minerals

Canada and the US signed a Memorandum of Understanding confirming Canada’s participation in the Energy Resource Governance Initiative (ERGI), reflecting mutual interest in improving global supply chains for critical minerals. Both countries recognize global demand for minerals will increase dramatically in the coming years and this MoU provides an important framework for cooperation in addressing these complex challenges and securing supply chains for the critical minerals needed to support important manufacturing sectors, including aerospace and defense, and clean technology. Washington has grown more concerned recently about its dependence on mineral imports after Beijing suggested using them as leverage in the trade war between the world’s largest economic powers.  It is estimated that China controls more than 80 per cent of the global supply chain of the rare earth elements.


US News


US operators brief FMC on concerns with Canadian ballast water regulations

US flag Great Lakes ship operators have briefed the Federal Maritime Commission on concerns over the proposed Canadian ballast water regulations. If the regulations go through, the US ship operators feel that the regulations could adversely and disproportionately impact the US fleet. Under the Foreign Shipping Practices Act and Section 19 of the Merchant Marine Act of 1920, the FMC has the Commission authority to investigate and sanction discriminatory conditions caused by rules, regulations, or laws of a foreign government.

Trump expected to sign off on 2020 transportation spending bill

President Trump is expected to sign off on a $1.4 trillion 2020 spending package today. In the package is $225 million allocated for port infrastructure to improve gate operations, roads and rail within and connecting to ports, ship berths and cargo operations. Additionally, $104 million within the Customs and Border Protection budget was aimed specifically at hiring up to an additional 610 CBP officers and agriculture specialists to help ease border trade. The US Army Corps of Engineers received $532 million – a 12% increase over last year – for deep-draft dredging projects.


International News


Shipping to invest $5 billion R&D fund

The international shipping community plans to create the first collaborative shipping R&D fund, intended to reduce greenhouse gas emissions by 50 percent by 2050. The proposal includes core funding from shipping companies across the world totalling approximately USD 5 billion over a 10-year period. The financing will come from shipping companies worldwide via a mandatory R&D contribution of USD 2 per tonne of marine fuel purchase for consumption by shipping companies worldwide. Under the International Chamber of Shipping proposal, the body would be overseen by the International Maritime Organisation (IMO).

Defective new fuels detected across Europe

FOBAS, the fuel verification company owned by class society Lloyd’s Register, has issued alerts this week about non-compliant fuels cropping up across the continent, a major concern as the IMO 2020 regulation is now less than two weeks away. Defective fuels have been found in Estonia, Antwerp, and Rotterdam. The defective fuels could result in excessive sludge deposition leading to engine and turbocharger damage. In the meantime, the European Maritime Safety Agency (EMSA) has issued guidance for a harmonized approach to the inspection of ships, ascertaining their compliance, identifying non-compliances and applying control procedures for the enforcement of Directive (EU) 2016/802 (codification of Council Directive 1999/32/EC), as regards the sulphur content of marine fuels.

Australia issues guidance on scrubbers

The Australian Maritime Safety Authority has issued a marine notice to advise vessel owners, operators and masters of Australia’s requirements for the use of Exhaust Gas Cleaning Systems (EGCS). The notice provides guidance on approved systems, advance notification of EGCS use, notification of any malfunctions, and advises that AMSA will be monitoring wash water discharges.

India updates single-use plastics draft directive

The Indian Directorate General of Shipping (DGS) has issued a Draft Addendum to its previous directive banning single-use plastics in Indian waters. As a consequence, all ships are permitted to continue operating in Indian waters and ports and, discharge plastic waste to port reception facilities in accordance with MARPOL Annex V. In the meantime, the International Chamber of Shipping will continue to assess the prohibition orders and work through appropriate mechanisms to seek pragmatic solutions that respect the realities of shipboard operations and the requirements of MARPOL. Members are requested to provide any reports or information concerning refusals of plastic waste discharges to port reception facilities to the ICS secretariat at the earliest opportunity.

BIMCO introduces two new clauses for sanctions

BIMCO’s Documentary Committee has approved two charter party sanctions clauses to help owners and charterers manage due diligence policies and navigate an increasingly complex environment of economic and trade sanctions imposed by governments. The clauses are intended for use in all trades, except for the container trades which require more specialized provisions, and BIMCO is currently developing a separate sanctions clause for container operators which will be released early next year. The benefit of using the clauses is twofold; They provide the ability to terminate the contract and to claim damages in limited circumstances when the counter party and/or the third parties listed in the warranties are sanctioned. BIMCO has chosen termination as the appropriate right in this context because that is often a breach which is incapable of being remedied. That changes however, when the performance of the charter party involves a sanctioned activity or third party. A right to change voyage orders and/or suspend performance is a more appropriate remedy when the performance involves a sanctioned activity or person.

Pirate attacks in Gulf of Mexico escalate

Mexico has been seeing a staggering rise in attacks on maritime oil infrastructure. According to sources, attacks went up by 310 percent between 2016 and 2018, with this number having risen only further in 2019. The International Transport Workers’ Federation (ITF) has reported that an average of 16 attacks a month were registered between January and September 2019. According to the ITF, oil or the personal belongings of the crew are not the only items on the attackers’ shopping list. Communication equipment, navigation machinery, engines, expensive spotlights, drilling rigs, valves and pumping material have all been taken, presumably, to be sold on the black market. In response to a recent incident, Mexico’s President Andrés Manuel López Obrador announced the construction of a new naval base in Dos Bocas, Tabasco, at the heart of Mexico’s oil industry. This base will serve specifically to fight piracy in Mexican waters.


Upcoming Events


Dec 25 -  Office Closed - Christmas Day

Dec 26 -  Office Closed - Boxing Day

Jan. 9 -   VMAA Board of Directors Meeting

Jan. 15 - ICS Board Meeting

Jan. 21 - ISSC Board of Directors Meeting

Jan. 20 - COS Board of Directors Governance Meeting

Jan. 29 - PACMAR / NANs Committee Meeting

Jan. 30 - Winter 2020 OPP Dialogue Forum

Feb. 4 -  Cargo Logistics Canada Conference


Ship of the Week


Dec. 20 - Arktika

The Arktika, Russia’s largest and most powerful icebreaker has just completed its first round of sea trials. The Arktika is under construction at Russia’s Baltic Shipyard in St. Petersburg, with final sea trials scheduled for March-April 2020 followed by delivery planned for May 2020. The icebrekaer is first in Russia’s project 22220 which is planned to produce three nuclear-powered icebreakers for Russia’s state nuclear agency ROSATOM. Once delivered, Arktika will become the largest and most powerful icebreaker in the world, used for ship escort and icebreaking in the Russian Arctic.
Displacement:      33,540 tonnes
Length:                   173.3 m
Beam:                          34 m
Draught:                    10.5 m
Installed power:   Two RITM-200 nuclear reactors, two turbogenerators
Propulsion:          Nuclear-turbo-electric; three shafts (3 × 20 MW)