fleetMaritime: IRISH SHIPPING & FREIGHT
MARITIME I | 27
Compiled by Howard Knott Edited by Jarlath Sweeney email: maritime@fleet.ie
Volume 9, No. 2 Spring 2014
Stena acquires Celtic Link ferry service
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n 26 February the surprise news came that Stena Line had acquired the Celtic Link ferry service running between the ports of Rosslare Europort and Cherbourg. The Swedish owned and managed ferry line, which is already the dominant operator on the Irish Sea with ships already operating up to 120 round trip sailings a week out of four Irish Ports, expects to take over operation of the service from 31 March. Stena Line will continue to operate the ‘Celtic Horizon’ which Celtic Link had taken on charter from her Italian owners in 2011, on the all year round three weekly trip operations. The vessel was built by the Italian Visentini yard in 2006 and is a close sister of the ‘Stena Lagan’ and ‘Stena Mersey’ that operate the Line’s Belfast-Birkenhead route. The ‘Epsilon’, operated by Irish Ferries on its Dublin/Cherbourg route is also a similar vessel. Commenting on the service takeover, Stena Line’s Chief Operating Officer, Michael McGrath said, ”This exciting investment represents an important milestone for Stena Line as, for the first time in our history, we will be able to offer a direct ferry link between the Republic of Ireland and the Continent. We believe we can bring significant added value to the route with our wealth of industry experience and award winning customer service standards which we are confident will help to stimulate increased traffic volumes in the future.” The new route will also be Stena Line’s first operation in the English Channel for a number of years. Up to now the Western Channel routes have been dominated by Brittany Ferries and LD Lines/DFDS. Celtic Link Ferries commenced operations in 2005 chartering the Ro-Ro ferry ‘European Diplomat’ from P & O, which had, up to its rationalisation of services that year, operated on the Rosslare/ France route. While the P & O operation was very freight focussed, Celtic Link sought to develop the passenger related business in the Falklands War veteran vessel, now re-named ‘Diplomat’. In 2008 LD Lines brought its brand new ‘Norman Voyager’ to open a rival service out of Rosslare but, in 2009 withdrew, chartering the vessel to Celtic Link and entering into an arrangement to market the passenger services in France. The
‘Diplomat’ was retired and the small Celtic Link team continued to build up traffic levels on the route, its schedules and those of Irish Ferries giving Irish exporters a six day a week service exRosslare. The “Norman Voyager’ reverted to LD Lines in 2011 to operate on routes in the Western English Channel, though it has recently been chartered to Brittany Ferries to operate its ‘economie’ ser vice linking Portsmouth and Santander. As it left Rosslare the ‘Celtic Horizon’ arrived to take up the sailings. Stena Line continues to operate its twice daily Rosslare/Fishguard service and Ian Davies, whose duties as Route Manager, Irish Sea South now includes taking care of the new service, on talking about the takeover of the Cherbourg service said, “The acquisition of the Rosslare-Cherbourg route is a key strategic investment for Stena Line and one that will help stimulate and strengthen new and exciting opportunities for trade and tourism between Ireland, France and beyond. With confidence in the Irish economy strengthening, we see positive long term growth in tourist and freight traffic from the Continent as a real opportunity to strengthen this economic growth further.”
Stena Line has confirmed its operation of the HSS ‘Stena Explorer’ on the Dun Laoghaire/Holyhead route for the summer period running from 9 April through to 9 September, on a one round trip daily basis.
Stena Line, when taking over the Sealink Ferry operations acquired ownership of the one time railway owned Ports of Fishguard and Holyhead. The Port of Rosslare, like Fishguard, was developed and is owned by the Fishguard & Rosslare Railways and Harbour Company but it is operated by Iarnrod Eireann.
Stena Line has also been reported as embarking on a major cost reduction exercise seeking to cut £10 million from maintenance and crewing costs during 2014 on its Irish Sea Services. All vessel maintenance will be undertaken at the Stena owned Northern Marine company based in Clydebank while salary costs will also be targeted.
Locally, in County Wexford, there is some sadness at Celtic Link Ferries being taken over as there has been strong identification with the company operating in a tough market throughout the recession.
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FREIGHT FERRY SERVICES FLEETMARITIME | SPRING 2014
28 | MARITIME II
Europeanised Container Tracing hile large ocean shippers can get information about where their containers are on the high seas or elsewhere in their supply chains through Electronic Data Interface (EDI) with their ocean carriers, small shippers who don’t have EDI are often left in the dark. Particularly in cases where the containers are travelling from goods manufacturer through to final customer using a number of transport modes and where the containers may have to make a number of connections en-route between ocean and feeder carriers this can be a serious issue. Irish exporters tend to be particularly exposed in this area.
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key events in a shipper’s supply chain should trigger transmission of data.
That may be changing now that INTTRA, the multicarrier e-portal, has teamed up with the information standards group GS1 to develop and implement guidelines and standards for the exchange of data on the whereabouts of container shipments.
Shippers in the workshop had the opportunity to tell carriers what they needed to know and when, depending on where their containers are based, and carriers gained a better understanding of how and when to provide that data.
INTTRA, which provides electronics booking services for 52 ocean carriers and non-vesseloperating common carriers, has been working on the guidelines for nine months in a workshop with GS1 in the U.S., whose data standards are already in use by more than 300,000 businesses in 25 industries. Sandra Moran, INTTRA’s Chief Marketing Officer, said in an interview, “A lot of people are talking about improving supply chain visibility, but we have a blueprint for the underlying data to make improvements possible, and everyone will benefit from the foundation work done by this organization.”
Last summer INTTRA and some of its carriers and large freight forwarders joined with shippers in the GS1 U.S. Logistics Workgroup to develop data guidelines and standards. “We got all the people who want the data together in the same room with the people they were asking to provide the data,” Sandra added. “That created a very clear picture of the people who were requesting the information and the people who were providing the information.”
The problem facing the working group that developed the guidelines was that the data provided by Ocean Shipping Lines and Charterers of Shipping Space on the whereabouts of shippers’ containers comes in a wide variety of formats. Shippers may need the data in formats different to what carriers provide or may not be able to read that data. The container industry already had somewhat vague guidelines for data, but because they were not clear and there were no standards for the way data should be exchanged, this creates barriers for the way the container industry can deliver and exchange data. In addition, there were no clear standards for when
The workshop produced standards for electronic data exchange in the container industry. They will be published in the next three months and incorporated in the North American standards published by the American National Standards Institute. The new standards are likely to prove very popular with shippers. A survey of 149 companies with global supply chains found that 63 percent of respondents rate supply chain visibility as a high priority for improvement. Another 45 percent said the key driver for improving visibility is addressing the operational pressures of growing their global operations and their complexity.
Irish Continental Group’s positive outlook
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n the course of reporting its 2013 figures the Irish Continental Group (ICG) takes a very positive view of 2014 and all aspects of the company’s trading during the year. It sees positive economic growth in the Irish and UK economies while fuel costs are likely to remain stable through the period. The SECA implementation at 1 January 2015 will have a significant adverse effect on the company’s Lo-Lo business but, as most of the Ferry activity is in the Irish Sea, will not affect that area. Ro-Ro freight is now growing rapidly for the company with 205,300 units carried in 2013, which was an increase of 11.8% on the previous
year, but carryings for the fi rst two months of 2014 were up by a further 18% on the same period in 2013. These figures could not have been achieved without the addition of the “Epsilon” to the fleet.
On the Lo-Lo container business the company operated five chartered vessels in 2013, serving six ports and carrying a mix of door to door freight and feeder traffic. The latter business, accounting for 46% of this activity, carries containers on behalf of deep-sea lines to and from their hub ports. Overall, 2013 volumes were up by 10.4% over 2012 at 279,200 TEU and the line expects a further increase of over 3% for 2014. ICG also operates container terminals in Dublin and Belfast ports. The Dublin Ferryport Terminal (DFT) has a design capacity of 260,000 lift s annually and a 2013 throughput of just over half that amount. It is the largest container terminal in Ireland. The Belfast Container Terminal with a design
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IRISH SEA ROUTES FLEETMARITIME | SPRING 2014
MARITIME III | 29
SECA Area
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ll ships transiting the North Sea and English Channel SECA (Sulphur Emission Control Area) area will be required to use fuel with a sulphur content of 0.1% Marine Gas Oil (MGO) which is significantly more expensive than fuel with sulphur content of 1%. Based on the current demand and supply patterns of MGO the price differential is approx US $300 per tonne or 50% more expensive than heavy fuel oil with 1% sulphur content. There are issues surrounding the availability of sufficient quantities of MGO from 1 January 2015 and the availability of refining capacity to meet the demand. As in all supply and demand situations this may lead to an increase in the price spread over the current level, so it is difficult to estimate the exact degree of increased costs. When this change is implemented it will lead to significant increases in the fuel costs for shipping lines, who will have to recover these increased costs from importers and exporters via surcharges on freight rates for the cargo, no matter whether shipped in containers, trailers or in bulk. Similar “low emission” policies currently operate in Baltic waters and it is instructive to look at the Stena Line Freight website to see the surcharging already in operation: htt p://www.stenalinefreight.com/ ferry/bunker-surcharge/. The increased costs are a direct consequence of EU Policy to deliver on Environmental Objectives. While, up to recently, there was optimism in some quarters that the full implementation of the new rules would be deferred to allow carriers take remedial action to
either “clean” their emissions from existing fuels and power plants by installing “scrubbers”, or by re-engining vessels to use LNG or alternative fuels, it is now clear that there will be no delay. The US has already put similar controls into force off its coastlines and those in the Mexican Gulf while other countries are in the process of doing likewise. By 2020 a similar emissions control regime will be in operation in all EU waters but, in the meantime vessels operating in the Irish Sea can continue as before. However, there is a practical difficulty for ship operators where a voyage takes place partly within the SECA area and partly outside. As most vessels only have one main fuel tank, then MGO will have to be used throughout the voyage. As a part of the ‘Weastflows’ project work the Irish Exporters Association (IEA) has taken part in a number of discussions of SECA and its implications for freight flows in NW Europe. A lot of work is being done by Shipyards and Lines to enable vessels to operate with new fuels such as LNG or hydrogen or to install “Scrubbers” to clean Heavy Fuel Oil to enable its continued use. Brittany Ferries is not only fitting its recently ordered Super Ferry with LNG powered engines, but is also starting on a programme of re-engining some of its newer ferries with similar power plants. DFDS Ferries, has, so far, chosen to go the “Scrubber” route. It is installing the new equipment in the funnels of its larger ferries operating on North Sea routes at a cost estimated to be about €10 million per vessel.
with the mainland and elsewhere has put its fi rst hybrid, MDO/battery power vessel into service. Early experience with the vessel shows that the batteries can be charged overnight while berthed at the offshore island using locally generated wind power, and that the vessel can operate for much of the day without recourse to the diesel engine. Newer battery technology just introduced in Norway gives lighter, smaller batteries, which can be significantly charged in ten minutes, less than the time that it would take a vessel to discharge and load. While companies such as those mentioned report good progress in meeting the SECA targets, the fleets that they own are only a small fraction of the vessels carrying cargo in European waters. More than half of the ferries operated by European Lines and almost all feeder and short-sea container vessels are chartered, some for very short periods. It has become clear that the owners of such vessels will not install any new technology but will accept that their vessels will have to run on Marine diesel. The same could be said for bulk carriers.
In Scotland, Calmac, who operates most of the domestic ferry network linking the Western Isles
New vessel emissions rules will hike costs for Irish exporters
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rom 1 January 2015 all vessels operating in the main NW European waters will be required to burn low sulphur fuel with sulphur content of 0.1%. Th is will have a major impact on the cost of importing and exporting between Ireland and Continental Europe as well as between Ireland and most other countries. capacity of 50,000 units operated 34,000 lift s in 2013. It is the intention of Belfast harbour Commissioners to consolidate the two existing container terminals in Belfast into one location at Victoria Terminal 3. ICG has submitted an outline proposal to operate the consolidated terminal and expects the fi nal decision on the tender process there to be made before the end of 2014.
In October 2008, the International Maritime Organisation (IMO) adopted a set of amendments to Annex VI of the MARPOL Convention, which strengthened the requirements on the permitted sulphur levels in ship fuels. As a result of these amendments in ‘Sulphur Emission Control Areas’ (SECAs) the maximum sulphur limit will be reduced from 1% to 0.1% from 1 January 2015.
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EUROPEAN ROUTES FLEETMARITIME | SPRING 2014
30 | MARITIME IV
SEA SHORTS The LD Lines ferry service operating from Gijon and St. Nazaire to Rosslare became a victim of the almost eleven weeks of storms that swept through the Bay of Biscay which had commenced in mid-December. All services operating through Biscay suffered huge delays and vessels had no opportunity to make up time even by cutt ing port calls. The company will re-start the Rosslare service on 16 June. Transport & Tourism Minister, Leo Varadkar, T.D., (pictured) speaking at a local tourism seminar, expects the heads of the Parliamentary Bill that will facilitate the transfer of the Dun Laoghaire Harbour Company from its current status as an independent State Company to being a part of the Dun Laoghaire Rathdown County Council setup, to be in the Dail by Easter. The planned schedule for the transfer would see the harbour coming fully under local Authority control by the end of 2015, or, latest, early 2016. He went on to say that one of the advantages of the new status would be that the harbour could then be in a position to seek State funding for certain development projects.
Iarnród Éireann has reported an increase in rail freight volumes across the Irish network by 4% during 2013. Some 600,000 tonnes of freight were carried and total tonne-kilometres exceeded 100 million. The Semi-State company anticipates further strong growth through 2014. Current freight transport projects underway include a full study of the Foynes Port to Limerick line linking the County Limerick Port into the national TEN-T network. Volvo Cars Ireland has taken on sponsorship of Cork Week. Cork Week is the major yacht racing event on the South Coast att racting entries from far and wide. It is run every second July and alternates with the more recently established Volvo Dun Laoghaire Regatt a. Volvo use a wide range of sailing related sponsorships as part of the marketing mix for both the Truck and Bus and the car brand, the latter of course, now Chinese owned. In the course of an announcement of a reduction of light dues, the charge that vessels must pay to fund the provision of Navigational Aids in British and Irish waters, UK Shipping Minister, Stephen Hammond, M.P. said that the on-going dispute about funding the Commissioners of Irish Lights was close to being resolved. InterGovernment discussions have taken place with a view to placing the activities of the Irish Body on a self-funding basis. Fees being charged in these waters are reduced by 2.5%, remaining unchanged since 2010.
afternoon sailing from Belfast instead of an early Tuesday morning sailing ex-Birkenhead. This will give better connectivity for Irish exporters to the British Midlands. On the Dublin – Holyhead service the evening, 21.15hrs sailing from Dublin will now leave 45 minutes earlier, at 20.30hrs. Explaining the change, Richard Horswill, Stena Line’s Head of Freight UK & Ireland said, “the key benefit for our freight customers will be the arrival of the Stena Adventurer at Holyhead, 45 minutes earlier at 00.01hrs which will be a great advantage and benefit for our customers with early morning time sensitive deliveries. It will also improve the journey times for those customers making landbridge connections”. The Transport and Tourism (TRA N) Committee of the European Parliament has stipulated that longer vehicles, regardless of whether they transport 45ft containers used in deep-sea or short-sea operations, should be prohibited from travelling further than 150km from the Port of unloading. The European Commission had previously proposed that 15m trailers carrying 45ft containers used in short-sea shipping should travel freely within the Community. The new restrictions, if confirmed by the European Parliament in April, will cause significant difficulties even in Ireland where distances from Shippers/receivers to ports are relatively short.
Following extensive discussions with freight customers, in particular, on its Irish Sea routes, Stena Line has made some schedule changes. On the Belfast to Birkenhead route the weekly rotation of four round trip sailings with the ‘Stena Hibernia’ will now commence with a Monday
Foynes
Irish Lights
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AN ESSENTIAL PART OF YOUR TEAM FLEETMARITIME | SPRING 2014