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Satisfaction survey in container transport | Brazil Modal

249 shippers and forwarders who took part in the survey rated the service of container shipping lines with a score of 3.1 on average (which is 0.1 lower than last year) on a scale of 1 (very dissatisfied) to 5 (very satisfied).

Customer satisfaction was reported least favourable for clarity of prices and surchargestransit times, and reliability of booking/cargo shipped as booked scoring between 2.8 and 3.

All the service features were overall awarded mid-range scores; only 4% of customers were “very dissatisfied” with carrier services and only 6% were “very satisfied”.


Source: ESC


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The Dangers of Trade Orthodoxy – Foreign Policy

From the orthodox view of trade, all nations win as markets spread tranquilly across borders. In reality, trade can often produce just the opposite: fierce market competition and worsening income inequality. Touted as a great employment generator, trade in fact cost a million factory jobs in four industrial U.S. states where angry voters cast ballots for President Donald Trump, according to a study by David Autor of the Massachusetts Institute of Technology and several co-authors. Now his trade war with China threatens to cut off business supply chains and spill into military rivalry.

In the developing world, meanwhile, trade has helped many poorer nations tap into world demand for exports. But there, too, it has caused harm. Even after Mexico’s “lost decade” in the 1980s, only 2 million Mexicans had crossed the U.S. border by 1990 seeking better lives as undocumented residents. But after the 1994 North American Free Trade Agreement (NAFTA), the numbers surged. By 2000, 4.8 million undocumented Mexicans, despairing of their future at home, were in the United States.

Orthodox thinking, it seems, has a problem. On its website, the World Trade Organization (WTO) still has emblazoned the original win-win model published by the British economist David Ricardo in 1817. If Britain uses less labor to make a yard of textiles than to make a gallon of wine, and Portugal uses less labor to make the wine than the textiles, Ricardo argued, they can each produce the good they make most efficiently, trade some of it for the other country’s good, and obtain more of both. Protectionist barriers are akin to throwing rocks in one’s own harbor.

The Ricardian model captures important insights, but its benefits are only fully realized if all its assumptions are met. Ricardo point-blank assumed away today’s fear that free trade allows factories to move abroad. Investors, he maintained, were generally “satisfied with a low rate of profits in their own country, rather than seek a more advantageous employment for their wealth in foreign nations,” he wrote, because they feared locating under “a strange government and new laws.”

His model, as well as modern variants of it, also assume that trade is balanced, both nations enjoy full employment, each nation has a single wage (income inequality is literally zero), and trade doesn’t affect the course of industrial development—all wild stretches. Of course, other models have delved into the issues the Ricardian model assumes away, but none has been so enshrined in contemporary thought.

In fact, Ricardo himself cared deeply about two of the issues his model writes off: income inequality and industrial development. The aristocracy was his particular bugbear. The idle rich monopolized agricultural land and drove up the price of wheat, the staple food of the working class, he argued. He fought against laws blocking grain imports in the hopes of reducing food prices, easing pressure on workers, and still leaving industrialists with higher profits. Since profits were nearly all invested (banking was still rudimentary), if they increased, Ricardo argued, they would spur development.

Beyond using it as an example in his model, Ricardo seems to have thought little about Portugal itself, but its unhappy situation also highlights development concerns that his schema can’t deal with. In 1703, the Royal Navy had sailed into Lisbon and forced Portugal to sign a now famous treaty to trade its wine for British textiles. Portugal never exported enough wine to balance this trade (the Brits, it seems, were insufficient lushes). In real life, to finance the textile trade, Portugal forced slaves to dig gold in Brazil and shipped perhaps 50,000 pounds’ worth every week on packet boats to England.

Demand for Britain’s textiles overseas, key to the early industrial revolution, supported its development. Demand for Portuguese gold supported, well, slaves digging gold. And Britain was not shy about passing acts requiring its colonies to buy more of its wares. “A great empire has been established,” Adam Smith complained, “for the sole purpose of raising up a nation of customers who should be obliged to buy from the shops of our different producers.”

U.S. Treasury Secretary Alexander Hamilton, having learned from that empire’s evident success, called for industrial policies—a national bank and infrastructure construction—and tariffs to shield American industry from foreign competition. Presidents George Washington and John Adams implemented some of these policies, the slaveholding Presidents Thomas Jefferson and Andrew Jackson undermined them (what need have slaveholders for industry?), and then ex-business lawyer Abraham Lincoln championed them.

From the Civil War to World War I, as the United States advanced from peripheral nation to global power, it maintained average tariffs of 40 to 50 percent, Ha-joon Chang of Cambridge University documents in Kicking Away the Ladder: Development Strategy in Historical Perspective. The Smoot-Hawley tariffs that were levied during the Depression—the ones economists never tire of lambasting—were only a bump up to the higher end of the range.

Essentially, all of the countries that we now think of as developed used domestic policies to promote industry and trade protection to shield it, Chang concludes. Modern China’s approach to export promotion and trade protection is just a free variation on Hamilton’s policies and Britain’s before them. Chinese government banks, including the four largest banks in the world, lend to support national manufacturing and booming infrastructure investment, often via state-owned firms. China manipulates its currency to make exports cheaper and imports more expensive, demands that government agencies at all levels buy local, and requires foreign investors to share intellectual property—or just outright appropriates it. “Not unlike the United States in the 19th century,” Wall Street financier Steven Rattner has written, gung-ho Chinese growth policies and lax law enforcement have “an unsavory wild West flavor.”

Another issue Ricardo’s model assumes away—trade’s effect on employment—did not concern politicians until workers gained voting strength after World War I. In a 1937 essay, “Beggar-My-Neighbour Remedies For Unemployment,” the Cambridge University economist Joan Robinson presented win-lose models showing how a nation can use protectionism to run a trade surplus, sustain demand for its goods, and create jobs—all while pushing deficits and unemployment onto its trading partners. Modern economists rail against “beggar-thy neighbor” protectionism but rarely acknowledged her point: why a nation might use protectionism to support its economy to begin with.

Robinson’s concerns loomed large for the negotiators from the 44 Allied nations who met in Bretton Woods in 1944 to negotiate the post-World War II economic order. John Maynard Keynes, leader of the British delegation, had solicited Robinson’s ongoing advice in writing his own economic theory. Harry Dexter White, the U.S. leader, hewed to Keynes’ ideas, as did the overwhelming majority of other delegates. But they all understood Ricardo too.

Believing that trade war had contributed to the Depression and fascism in the 1930s, Keynes called for a global framework that would manage tensions, allow nations to trade peacefully, and sustain full employment. But he and his contemporaries at Bretton Woods did not seek to micromanage gazillions of individual trade rules—unlike Trump today, who believes he can use protectionism to decrease the U.S. trade deficit. The fact is that protectionism rarely affects overall trade deficits or surpluses. For example, throughout the post-World War II decades, Latin American nations such as Mexico, Brazil, and Argentina wielded high tariffs, often exceeding 50 percent, as well as setting fixed quotas on some imports—and still often racked up large trade deficits.

How can a nation with high tariffs run trade deficits? Tariffs regulate what is imported rather than how much. Postwar Latin American regimes would allow in industrial goods they couldn’t produce themselves but block consumer imports—a common development strategy. Overall, they still imported as much as they could borrow from abroad to pay for foreign goods. The United States did something similar after Trump’s tax cuts. Americans had more money in their pocket, but U.S. production couldn’t leap to match the demand, so goods poured in from abroad. The trade deficit swelled.

To prevent such outcomes, when the Bretton Woods negotiators set out to support trade but avoid large imbalances, they focused on financial flows across borders—IOUs nations accumulate in exchange for exports when they run trade surpluses or incur when the run trade deficits. The International Monetary Fund would monitor and control these flows.

The IMF would lend to deficit nations, but if they began borrowing too much, the fund would require them to cut government expenditures to reduce demand or otherwise slow imports. On the flip side, if a nation’s surplus began to rise, the IMF would start requiring measures to correct the problem. Before too long, the IMF would authorize deficit nations to completely halt exchange of the surplus nation’s currency, blocking its exports. Had the IMF operated as planned, China would have never had a chance to rack up its recent trade surpluses.

But the IMF faced immediate problems. After World War II, the administration of President Harry Truman—more economically conservative than the administration of President Franklin D. Roosevelt that had negotiated Bretton Woods—did not want to let any international agency interfere with U.S. trade surpluses. It starved the IMF of capital, personnel, and authority, quashing it for a decade. When the fund finally stirred back to life in the mid-1950s, it set about imposing harsh conditions on deficit nations in exchange for bridge loans. It hardly touched surplus nations.

By the 1960s, as some U.S. sectors went into trade deficit, IMF managing director Pierre-Paul Schweitzer, U.S. representatives to a fund meeting in 1967 in Rio de Janeiro, and other officials pushed to revive something like the original Bretton Woods system. But France, believing it would abet U.S. “hegemony,” opposed the idea, and Japan and Germany, having emerged as major surplus nations, dragged their feet.

Germany now learned to measure economic success not by “domestic well-being,” the economist Adam Tooze has lamented, but by “the scale of its trade surplus.” Though it escapes notice, Germany often runs surpluses in goods and services larger than China’s. Indeed, the financial IOUs Southern European nations signed over to German banks to cover their trade deficits set up the euro crisis.

All along, politicians never really seemed to believe Ricardo. Even U.S. President Bill Clinton, the consummate globalist, promoted NAFTA by promising that it would “create a million jobs in the first five years”—and well-paid jobs at that. Not only did they not materialize, the Ricardian model does not even promise them, but just assumes full employment from the start.

As the touchstone of trade orthodoxy, a position the pragmatic Ricardo himself would hardly have given it, the Ricardian model itself causes harm. By shoving the very idea of trade tensions under the table, it undermines coherent discussion of how to handle them. At best, the result is endless squabbling about dirty exceptions to an imagined world of perfect markets. At worst, the result is trade war, sometimes spilling into real war.

A contemporary revision of the IMF to handle trade tensions might be technically possible—it would first focus on correcting large currency undervaluations or overvaluations (causing sustained surpluses or deficits)—but nations won’t agree to it any time soon. In its absence, they will keep squabbling over trade at best, erupting in trade wars at worst. Global markets, spreading unregulated across national polities, will let capital apply pressure by seeking out cheaper locations to operate—NAFTA helped Mexico attract investment for a few years but soon saw much of it flee for lower-wage China—threatening an equitable income distribution, and on-and-off undermining full employment.


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APL applies new Low Sulphur Fuel surcharge | Brazil Modal

APL will apply the following Low Sulphur Fuel surcharge (LSF) update with effect from 1 May 2019 until further notice, for the service scope stated below:

Origin: Canada (Via Halifax; Vancouver); Canada (via USA (Oakland; San Pedro; Los Angeles; Long Beach; New York; New Jersey; Norfolk; Philadelphia; Baltimore; Charleston; Savannah; Miami; Houston; New Orleans; Seattle; Tacoma)); USA (via Oakland; San Pedro; Los Angeles; Long Beach; New York; New Jersey; Norfolk; Philadelphia; Baltimore; Charleston; Savannah; Miami; Houston; New Orleans; Seattle; Tacoma); USA (via Alaska (Dutch Harbor; Kodiak; Anchorage))

Destination: Austria; Czech Republic; Hungary; Slovakia; Switzerland, North Europe (Germany; Netherlands; Belgium; France; United Kingdom (except Grangemouth, Teesport, Immingham); Ireland); Spain (Bilbao, Gijon, Vigo); Portugal; Denmark (Via Motor)

Dry USD 35 70 70 70
Flat Rack/ Open Top/ Tank USD 35 70
Refrigerated USD 35 70 70


Origin: Canada (Via Halifax; Vancouver); Canada (via USA (Oakland; San Pedro; Los Angeles; Long Beach; New York; New Jersey; Norfolk; Philadelphia; Baltimore; Charleston; Savannah; Miami; Houston; New Orleans; Seattle; Tacoma)); USA (via Oakland; San Pedro; Los Angeles; Long Beach; New York; New Jersey; Norfolk; Philadelphia; Baltimore; Charleston; Savannah; Miami; Houston; New Orleans; Seattle; Tacoma); USA (via Alaska (Dutch Harbor; Kodiak; Anchorage))

Destination: Scandinavia (Denmark (Except Via Motor); Sweden; Norway; Finland; Iceland); Poland; Russia (Except Vladivostok, Vostochny, Novorossiysk); Estonia; Latvia; Lithuania; United Kingdom (Grangemouth, Teesport, Immingham)

Dry USD 50 100 100 100
Flat Rack/ Open Top/ Tank USD 50 100
Refrigerated USD 50 100 100


The LSF will be applicable for the service scope stated above and will also be applied to the Freight All Kind (FAK) Basic Ocean Rates. The associated basic freights are available here. Other Bunker related surcharges, Terminal Handling Charges (Origin and/or Destination), Peak Season Surcharge, Security related Surcharges, and similar charges may also apply and are accessible here. Other charges such as contingency and local charges may also apply. All out ports will be subjected to add-ons.


Source: APL


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Friday preview: JP Morgan, Chinese foreign trade in focus

The focus at the weekend will shift towards the health of the US corporate sector, as banking heavyweights JP Morgan and Wells Fargo kick off the first quarter earnings season across the Pond.

Nonetheless, any reaction is likely to be constrained given the depleted trading volumes around the Easter break.

The ‘bottom-up’ consensus for S&P 500 earnings per share stands at $37.29, having been savaged by 7% over the past three months, which was more than twice the typical 3% pre-earnings season cut, according to strategists at Bank of America-Merrill Lynch.

That would be equivalent to a 2% decline in EPS versus a year ago and mark their first drop since the EPS recession of 2015-16, BofA-ML said.

However, there might be a silver lining to be had.

Historically, in situations such as the above, earnings had then gone on to outstrip analysts’ estimates by 3%, they added.

In terms of US data, the import price index for March is set for release at 1330 BST, followed by a preliminary reading on consumer confidence in April from the University of Michigan.

Chinese data will also be in focus, with a report on the Asian giant’s foreign trade due out overnight, possibly alongside the latest money supply and credit data.

For JP Morgan Chase‘s results, Michael Hewson at CMC Markets UK told clients there was potential for another set of disappointing earnings.

Already in the previous quarter, the lender’s profits had come in short of analysts’ estimates, for the first time in 15 quarters.

And during the first three months of 2019 the Treasury yield had inverted a tad at one point.

The consensus forecast for JP Morgan was for adjusted EPS of $2.37 after the $1.98 seen over the previous three-month stretch.

Friday April 12


Abcam, Clinigen Group, Dunelm Group, ECO Animal Health Group, Go-Ahead Group, Hays, Origin Enterprises, River and Mercantile Group , Standard Life UK Smaller Companies Trust, TR European Growth Trust


Blackrock North American Income Trust , Land Securities Group, Schlumberger Ltd.


Import and Export Price Indices (US) (13:30)

Industrial Production (EU) (10:00)

U. of Michigan Confidence (Prelim) (US) (15:00)


Banco Santander S.A.


Arbuthnot Banking Group


Electra Private Equity, River and Mercantile Group


HSBC Holdings


PCF Group, RM


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US Seaborne Crude Oil Exports at Record High | Brazil Modal

Illustration. Image Courtesy: Pexels under CC0 Creative Commons license


Exports rose in January on the back of increased sales to Europe, which were up from 2.7 million tonnes in December to 4.8 million tonnes in January.

A strong end to 2018 meant that volumes for the full year totalled 87.4 million tonnes, 96.7% higher than the 44.4 million tonnes exported in 2017. BIMCO said that this is good news for the crude oil tanker sector, with an additional 143 VLCC loads (300,000 dwt) or 287 Suezmax loads (150,000 dwt) needed in 2018 compared to 2017.

In January, the Netherlands was the largest importer of US crude oil, beating Canada even when considering total and not just seaborne exports. South Korea, the biggest importer of seaborne crude oil exports in 2018, fell to fourth place in January 2019. Until the summer of 2018, China, which was the largest importer, accounting for 23.3% of all seaborne exports in the first six months of 2018, took nothing in January.

“Although small volumes of US crude oil were sent to China in November and December, following a three-month pause in the trade, BIMCO did not take this as a sign that tensions between the two countries had eased, and were therefore not surprised by the lack of exports to China in January. A positive outcome from the ongoing trade negotiations is needed if this trade is to return to levels seen before the trade war,” Peter Sand, BIMCO’s Chief Shipping Analyst, said.

Although volumes were record high in January, tonne mile demand dropped following a record-breaking peak in December. US seaborne crude oil volumes generated 83.8 billion tonne miles in December, falling 19.7% to 67.3 billion in January, still over twice as many as in January 2017.

A drop in the share of exports to Asia meant that average sailing distances were shorter. Exports to Asia fell from 4.9 million tonnes in December to 3.2 million tonnes in January, with a large drop from South Korea (2.3 million tonnes in December to 0.8 million tonnes in January).

After China stopped buying US crude oil, South Korea bought much of the crude oil that would otherwise have gone to China. Exports to South Korea rose by 318% compared to 2017, making it the largest buyer of seaborne crude oil in 2018.

“The importance of Asia cannot be underestimated when considering how US crude oil exports impact the shipping industry. In 2018, 71.5% of tonne mile demand generated by US crude oil exports originated from exports to Asia. The sudden drop in exports to Asia in January was therefore particularly harmful to the crude oil tanker shipping industry. VLCC earnings rose to 53,121 USD per day in November, when vessels are being fixed for the following month, before falling again in January when tonne mile demand dropped,” Sand added.


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Latvia’s foreign trade turnover down 0.4% in February –

Latvia’s foreign trade turnover down 0.4% in February –
Latvia’s foreign trade turnover down 0.4% in February  bnn-news.comIn February 2019, the foreign trade turnover of Latvia amounted to EUR 2.06 billion, which at current prices was 0.4 % less than a year ago, of which the exports …
Latvia’s foreign trade turnover down 0.4% in February –


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Visser Shipping Chooses Hybrid-Ready Scrubbers for Its Ships | Brazil Modal

Illustration. Image Courtesy: Pxhere under CC0 Creative Commons license

Signed with Value Maritime, the contract includes an option for a fourth scrubber.

The open-loop scrubbers are set to be installed on Visser Shipping’s vessels between October and December this year in order to be ready before IMO 2020 goes into effect on January 1, 2020.

Visser Shipping currently has a fleet of five feeder container vessels providing transport throughout Northwest Europe.

“The decision to install the new type of scrubbers from Value Maritime fits well into our philosophy. It ensures cost efficiency in the long term for our clients and also helps conserve the environment,” Visser Shipping said.

“We have been investigating scrubbers from their beginning and found the retrofit to complex and too expensive, with the scrubbers from Value Maritime installation is more simple and costs are more in line with the size of our ships,” the company added.

Value Maritime has developed a small prefabricated, pre-installed, “plug and play” exhaust gas cleaning system in a 20ft transportable casing, that filters sulphur and ultrafine particulate matter from vessel’s exhaust gasses. The system assures compliance with the IMO 0,1% Sulphur cap (SECA).


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Exports to Brazil take off over South American trade deal

The ratification of trade agreements between the Southern African Customs Union (Sacu) and the Southern Common Market (Mercosur), a South American trade bloc, has been a key driver of the increase in exports to Brazil.

SA exports to Brazil for the year 2018 shot up to $183m from $43m in 2016-2017 as the government’s drive to boost export performance gathers steam.

However, SA producers still accuse Brazil of unfair trade practices, saying that country is dumping chickens and sugar in SA. The sectors have called on the government to impose higher tariffs on the Brazilian goods.

Sacu includes SA, Botswana, Lesotho, Namibia and Eswatini.

In his state of the nation address in February, President Cyril Ramaphosa said to boost economic growth and alleviate unemployment, SA had to find larger markets for its goods and services.

“We will therefore be focusing greater attention on expanding exports. In line with the jobs summit commitments, we will focus on the export of manufactured goods and trade in services such as business process outsourcing and the remote delivery of medical services,” Ramaphosa said at the time.

SA foreign economic representative in Brazil Shanaaz Ebrahim said the agreement between Sacu and Southern Common Market aimed to integrate the economies of member countries through gradual and reciprocal liberalisation of trade and the strengthening of economic co-operation.

“According to trade statistics our trade deficit with Brazil has shrunk considerably in 2018. The deficit is now at $700m, down from $1.2bn in 2017. Part of this was due to the ratification of the Sacu/Mercosur preferential trade agreement, which was ratified in April 2016 where Sacu had offered the [South American trading bloc] tariff line items of about 1,065 products across 16 sectors of which 469 products are 0% import duty free,” Ebrahim said.

She said Mercosur reciprocated by offering Sacu 1,052 product lines of which 778 products are 0% import duty free.

“This offers us a window of opportunity to penetrate the Brazilian market through these 0% import duty-free products. Negotiations of this agreement started in 2000.”

Ebrahim added that SA’s and Brazil’s membership to the Brics multinational agreements benefits both countries.

As Brazil will chair the 11th Brics summit in November, a series of working groups and meetings will be held during the course of 2019 “and we are looking forward to those agreements and substantive ‘implementables’.”

She urged SA companies to familiarise themselves with the list of 0% import duty-free products as that will “orientate them on the viability of their products within the Brazilian market and it would also stand them in best position to draw instant benefits resulting from the … preferential trade agreement”.


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COSCO Shipping Lines Seals LSFO Supply Deal | Brazil Modal

Illustration; Image Courtesy: Pxhere under Public Domain license


According to the agreement inked on March 28, 2019, Double Rich limited will provide fuel oil with sulfur content not exceeding 0.5% m/m for COSCO Shipping Lines’ vessels.

As explained, this would enable COSCO “to better fulfill the amendment of ANNEX VI in International Convention for the Prevention of Pollution from Ships (MARPOL), which has been adopted by IMO.”

By promoting and applying diverse emission reduction technologies and optimizing management pattern, COSCO is moving forward to realize green shipping. The LSFO supply deal has been described by the company as an important step towards “actively fulfilling MARPOL of IMO, confronting industry trends and adhering to green development.”

Preparing for the IMO 2020, the company has implemented research, development and application of ship desulfurization technology. On the basis of pilot installation of scrubbers on two vessels, COSCO Shipping Lines plans to equip more vessels with scrubbers.

COSCO added it intends, also in the future, to “fulfill international conventions and practice green concept by cooperating with partners and global major fuel suppliers.”


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London-based FCA regulated foreign exchange company RationalFX partner with Ripple By FX Street

London-based FCA regulated foreign exchange company RationalFX partner with Ripple

FX Street  | Apr 05, 2019 10:38AM ET

  • FCA regulated foreign exchange payments company Rational FX, are now the latest to leverage technology.
  • The company conducts a high volume of transactions, this year already reported at over $10 billion.

RationalFX, a foreign exchange United Kingdom-based firm, has recently announced a partnership with Ripple.


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