Monday, 20 August 2012

No doubt about the Canadians..a FTA with the EU.


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It has barely been reported in the media around the world but one of the worlds biggest mining and resource nations, Canada, is hurriedly trying to secure a Free Trade Agreement (FTA) with the European Union. A truly brilliant move in my book.

Mines in Europe are generally all but depleted so the primary resources need to be shipped in from somewhere so Canada is setting about ensuring it becomes the most competitive supplier possible by removing import duty and taxes on it's resources. No mining or carbon taxes being applied there unlike with the Canuk's biggest competitor, Australia.

Canada needs the business as the resources landscape in Canada is changing. Traditionally Canada has been a big energy supplier to it's southern cousin, the USA. However this is changing as the USA is increasingly using fracking technology to get natural gas out of places once thought impossible so the need for Canadian energy is diminishing.

Another reason is that with uncertain global economic conditions and generally slowing GDP growth in most regions of the world, it is only prudent to try and create conditions that lock in one the worlds biggest consumers as a customer, the EU.

On the otherside of the Atlantic with an FTA in place, a debt ridden Europe will no doubt love selling and shipping more BMW's, Gucci and Louis into Canada without import duties as well.

As a proud Aussie I am frustrated that my country isn't doing all it can to beat the Canadians to the punch with the EU. In fact we seem to be doing the opposite which will ultimately be at our peril. I think we have too much reliance on the Chinese buying our natural resources.

By the way, the cost of shipping from Canada to China is not that different from Australia so I think we better watch our backs as the Canadians are proving to be leaner, meaner and more agile and I'm sure are working hard on winning over our biggest customer.

Australia needs to take a leaf out of the Canadian's book with the EU and quickly get FTA's with our biggest trading partners and remove taxes that make us a less competitive supplier.

By the way, a little bit of intervention by the Aussie Reserve Bank to get our dollar down from 1.05 against the USD would help our exporters out a hell of a lot too!

What part of "exports bring money into the country to deal with debt and help us prosper" don't our regulators get?!

All for now,

Brad Skelton
The Shipping Bloke

Wednesday, 15 August 2012

How many containers get lost at sea?

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Frequently in the media I hear statistics quoted that up to 10,000 containers are lost overboard  at sea each year.  In these modern times, why does it happen at all?

A number of factors ranging from severe weather and rough seas to catastrophes like the ships themselves getting lost at sea just like the "Rena" (pictured off the coast of New Zealand) contribute to the losses. Safe stowage can also be compromised by shippers overloading containers although progressively most countries are following the International Maritime Organisations agenda to have the weight of all containers properly verified before loading.



As for the reliability of the data....there is isn't central source keeping track of this nor do the marine underwriters compile or publish any accurate statistics. The World Shipping Council has surveyed it's member shipping lines to try and find out how many containers are actually lost. It was radically different to what media outlets sensationally suggest. 

Not counting catastrophic events the survey revealed a figure of only 350 containers being lost each year. If you include catastrophic losses like the "Rena" then the number only rose to 675. A far cry from 10,000! Considering the millions shipped each year that's not too bad.

So the yachties of the world are safer than they think, my clients can probably sleep tonight and so can their underwriters. I still recommend you get insurance though!!

All for now,
Brad Skelton
The Shipping Bloke