Biden will not stop port strike, hoping for deal
US president Joe Biden said he is optimistic for a labor agreement between thousands of US dock workers and their employers, and that he would not block a strike expected to start 1 October.
"I think they'll settle the strike," said Biden said over the weekend about the dispute between the International Longshoremen's Association (ILA) and United States Maritime Association (USMX) that could halt container traffic at many US east coast and Gulf coast ports. "[I] spoke with both sides… We support the collective bargaining effort."
He ruled out the possibility of government intervention if the ILA were to strike "because there's collective bargaining, and I don't believe in [the] Taft-Hartley [Act]," referring to the 1947 law that curtails some union powers.
The ILA and the USMX could not immediately be reached for comment.
US ports and railroads have been preparing for a strike for many weeks, with much work expected to slow or stop ahead of the 1 October strike deadline.
The strike is expected to have the greatest impact on products carried on container ships given the ILA's membership. Movements of dry bulk cargo, such as coal and grains, are expected to be less affected by a potential work stoppage, though there could be side effects from the congestion of other products being rerouted to ports not affected by the strike.
Movement of crude, refined products and many petrochemicals are not expected to be interrupted by an ILA strike, but some polymers that are moved by container, including polyvinyl chloride (PVC), polyethylene (PE), and polypropylene (PP), could be disrupted.
Republican member of congress had called on Biden to intervene in the dispute. Last week USMX filed an unfair labor practice charge against ILA with the National Labor Relations Board, accusing the union of "repeated refusal" to negotiate, but the board has not ruled on the request.
Related news posts
Draught limits tighten on lower Mississippi River
Draught limits tighten on lower Mississippi River
Houston, 23 September (Argus) — The US Coast Guard (USGC) placed further restrictions on traffic on the lower Mississippi River as water levels continue to deteriorate. The USCG on 22 September announced that all northbound traffic cannot have draught deeper than 9.5ft from Tunica, Louisiana, to Greenville, Mississippi. For Greenville to Tiptonville, Mississippi, barges must remain above a 9ft draught, the shallowest draught channel allowed for the lower Mississippi River by the US Army Corps of Engineers. All northbound transit also cannot load more than four barges wide or configure more than five barges wide. Southbound traffic from Tiptonville to Greenville cannot be more than six barges wide or deeper than 9.5ft. Greenville to Tunica southbound barges can load as deep as 10ft but cannot be more than seven barges wide. All locations between Cairo, Illinois, and Greenville fell back to their low water threshold over the weekend as rainfall from Hurricane Francine flowed down the river. More grain has moved downriver this year compared with last year as the US Department of Agriculture (USDA) expects higher US grain exports in the 2024-25 marketing year. Around 367,000 short tons of grain moved for the week ended 14 September, which is about double the same period a year earlier, the USDA said. Both south and northbound movement is expected to see a heavier pace in October. By Meghan Yoyotte Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
Vancouver Aframax rates climb to 2-month highs
Vancouver Aframax rates climb to 2-month highs
Houston, 23 September (Argus) — Aframax rates for Canadian crude oil exports from Vancouver rose to two-month highs last week after more direct shipments to Asia-Pacific and four fuel-oil cargoes exported from California cleared out tonnage. The Vancouver-US west coast Aframax rate rose on 20 September to Worldscale (WS) 155, or $2.03/bl for Cold Lake crude, the highest since 18 July, according to Argus data, after Shell provisionally booked a vessel at that level for a shipment to the Pacific Area Lightering zone (PAL) loading in early October. Similarly, the Aframax rate for a direct shipment from Vancouver to China on 20 September was $3mn lumpsum, or $5.49/bl for Cold Lake, the highest since 25 July, according to Argus data. Since 20 August, 10 Aframaxes have hauled crude from Vancouver to destinations in Asia-Pacific, including China, Japan, South Korea and Brunei, with one more such export possible by the end of September, ship tracking data from Vortexa show, compared with just nine in May-July. The rise in direct Vancouver-Asia shipments has coincided with four rare fuel oil cargoes exported on Aframaxes from Chevron's 245,000 b/d Richmond, California, refinery to destinations across the Pacific. Those exports came after a possible unplanned shutdown at one of the refinery's secondary units, traders said. One of those Aframaxes, the Shell-operated Pacific Ruby , carried Vancouver crude to the US west coast three times since the Trans Mountain Expansion (TMX) came online in May. Aframaxes in the "dirty" tanker fleet can load crude oil or fuel oil cargoes. Direct transpacific shipments remove vessels from the west coast North America market for about 45 days. Muted activity at PAL With more crude going directly to east Asia, no ship-to-ship transfers of Vancouver oil onto very large crude carriers (VLCCs) have occurred since 25 August, Vortexa data show, likely due to a rise in VLCC rates. The rate for a VLCC voyage from the US west coast to China was $3.35mn lumpsum on 20 September, a rate last reached on 20 August and prior to that in May. All-in, the cost to reverse lighter three 550,000 bl shipments of Cold Lake crude from Vancouver onto a VLCC at PAL, then ship to China, was $8.38mn, or $5.11/bl, on 20 September, including $150,000 ship-to-ship transfer costs at PAL, 15 days of VLCC demurrage and three days of Aframax demurrage for each reverse lightering. By Tray Swanson Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
Norfolk Southern replaces CEO with CFO
Norfolk Southern replaces CEO with CFO
Washington, 12 September (Argus) — Eastern Class I railroad Norfolk Southern (NS) has appointed a new chief executive, replacing former executive Alan Shaw after determining he violated company policies by having a consensual relationship with the company's chief legal officer. NS' board announced late Wednesday that it had promoted chief financial officer Mark George to replace Shaw. The board said Monday it was investigating Shaw for potential misconduct in actions not consistent with NS' code of ethics and policies, but did not provide details. The railroad yesterday clarified that Shaw's departure was not related to the railroad's "performance, financial reporting and results of operations". Instead, the board voted unanimously to terminate Shaw with cause, effective immediately, for violating policies by engaging in a consensual relationship chief legal officer Nabanita Nag. She was also dismissed by NS. Shaw worked at NS for 30 years and was appointed chief executive in May 2021, following six years as chief marketing officer. Earlier this year he led NS through a proxy fight with a group of activist investors that sought his replacement. The overall effort failed but the challengers secured three seats on the board . The investors had been displeased with the railroad's financial performance and "tone deaf response" to the February 2023 derailment in East Palestine, Ohio . New chief executive George had served as NS' chief financial officer since 2019. Prior to that, he held roles at several companies including United Technologies Corporation and its subsidiaries. "The board has full confidence in Mark and his ability to continue delivering on our commitments to shareholders and other stakeholders," NS chairman and former Canadian National chief executive Claude Mongeau said. By Abby Caplan Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
Tanker freight rates expected to rise from 4Q: Appec
Tanker freight rates expected to rise from 4Q: Appec
Singapore, 12 September (Argus) — Tanker freight rates are expected to pick up in October-December and into next year's first quarter on recovering demand for dirty tankers, delegates said at the S&P Global Commodity Insights Appec conference in Singapore. Clean tanker freight rates for Long Range (LR) 2 and LR1 vessels fell in the third quarter because of competition from dirty tankers, Rohit Radhakrishnan, general manager, tanker and gas, Pacific Carriers, said at the conference on 11 September. Rates were dampened on higher competition from increased vessel supply, largely because several dirty tankers such as very large crude carriers (VLCCs) switched to ship clean products. A fully laden VLCC equates to slightly more than three LR2 cargoes, which are the vessels normally used to ship diesel and gasoil from the Middle East to Europe. This was in line with a trend since July when several dirty tankers such as VLCCs were booked to carry clean petroleum products from the Mideast Gulf and Asia to Europe, given weak seasonal demand for VLCCs in the northern hemisphere and higher time-charter equivalent (TCE) rates for clean LR vessels. But the dirty tanker freight market has risen since late last week. With the recent increase in demand for dirty tankers, its $/t discount with clean tankers has decreased, said Peter Kolding, vice president of commercial and pool management at Hafnia, a tanker company. As the winter season is also coming up, demand should increase, lending a general recovery in the fourth-quarter rates, Kolding added. VLCC freight rates have steadily moved higher from about 11 months-low because of active chartering activity late last week, with several freight participants also noting that they have already touched a bottom and should continue rebounding. The Argus -assessed rate for a VLCC carrying a dirty cargo from the Mideast Gulf to southeast Asia rose to $7.52/t on 11 September, from the 11 months-low of $6.49/t on 4 September. Tanker freight rates in 2025 will still be strong compared with past years, Radhakrishnan said, but might be slightly weaker than in 2024. With freight rates in the first quarter being seasonally strong, the market should be off to a good start, Kolding added, but noted that "we still got to keep an eye on geopolitical effects." The Red Sea conflict has played a huge part in freight rates this year because of increased tonne-mile demand and costs as vessels reroute through the Cape of Good Hope, said Kolding, adding that it would take a while for the conflict to be resolved. Rates could also find further support if crude prices continue to fall, attracting charterers to book tankers such as VLCCs as offshore storage for oil, the conference moderator said. By Sean Zhuang Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
Business intelligence reports
Get concise, trustworthy and unbiased analysis of the latest trends and developments in oil and energy markets. These reports are specially created for decision makers who don’t have time to track markets day-by-day, minute-by-minute.
Learn more