China Cosco Holdings Co, the container shipping line that posted three annual operating losses, said adding more fuel-efficient vessels will help cut costs enough to revive profits amid a capacity glut. “The ships need to be filled for the cost savings to be achieved,” said Guo Huawei, Board Secretary. COSCO ordered five fuel-efficient container transports that carry up to 14,500 TEU for delivery between 2017 and 2018. The ships are slightly smaller than the industry’s largest on order by rivals including China Shipping Container Lines Co and AP Moeller-Maersk, which are betting on economies of scale from vessels large enough to carry as many as 19,100 containers. “Reducing container line costs is probably the only thing COSCO can do right now,” Lawrence Li, Shanghai-based Analyst with UOB-Kay Hian Holdings, said. “Other things like refining its branding and operational know-how takes a longer time.” COSCO’s container arm cut fuel spending by 18% in the first half of the year by sailing ships more slowly, which boosts efficiency. Containers used to deliver consumer goods such as clothing, bicycles and televisions accounted for about 73% of revenue last year. Dry bulk shipping, including grain and ore, accounted for about 21%.

The first special trains for e-commerce freight delivery services between Shanghai and Beijing started running in July, marking the initial step of opening up rail services to commercial clients, China Railway Corp (CRC) said. CRC has reached an agreement with courier service providers and postal services authorities that the fast trains for e-commerce freight delivery may extend to the Yangtze River Delta, Pearl River Delta and Bohai Rim. SF Express, one of China’s largest courier services, contracted the first fast freight delivery train between Beijing and Shanghai. Other e-commerce platforms and courier services also are in negotiations with CRC to contract trains for parcel delivery. Rail delivery is faster than road transportation and much cheaper than cargo shipping. “Current air freight from Shanghai to Beijing may cost more than CNY0.8 per kilometer, while train freight is under CNY0.4 per kilometer. Intercity freight by train may be both cost-saving and time-saving,” said Huang Zhijun, a freight agent in Shanghai. “But for long-term cooperation and smooth operations, railway services must improve current warehousing, adjust to their schedules and link up railway and couriers’ outlets”, said Shi Jianjun, Manager with Shanghai Yuntong Shipping Consultancy Service. According to a report by CRC, in the first half of 2014, combined parcel delivery volume by rail in China totaled 770,000 metric tons, a 23.4% year-on-year drop. More fast trains for e-commerce and courier clients running between Beijing, Shanghai and Guangzhou were launched at the end of August.

China is negotiating with the governments of Mongolia, Uzbekistan, Kyrgyzstan and Pakistan to build three connective railroads to improve regional trade in the Silk Road economic belt. Huang Shengqiang, Director of the China Port Management Office, said China has already opened 25 international airports and land ports as well as 12 special trade areas along the economic belt within the country. It will continue to build regional freight stations and create more trading platforms with Kyrgyzstan, Pakistan, Mongolia and Nepal, Huang said. Since 2010, major Chinese cities, including Chengdu, Chongqing, Xian, Zhengzhou, Wuhan and Yiwu have began weekly or monthly train services to European and Central Asian destinations, part of China’s efforts to turn its inland resources and labor-rich cities into international trade hubs. Eighty-six cargo trains carrying 7,450 containers passed through the Alataw Pass railway station on the China-Kazakhstan border between January and July of this year, with trade volume reaching USD1 billion, according to customs. Transport Minister Yang Chuantang said regional connectivity is in the interests of all countries on the Silk Road Economic Belt. Yang added that China is following the Asian Highway Network deal signed in 2004 and the Trans-Asian Railway agreement of 2006 to continue its railway investment and develop major entry-exit rail and road projects.

Citic Resources has filed a lawsuit against Qingdao Port International, demanding USD108 million in compensation if its fails to deliver base metals retained by the authorities as part of a fraud investigation. Citic Resources claims it suffered a severe loss from its inability to dispose of 223,270 tons of sandy metallurgical grade aluminum and 5,004 tons of electrolytic copper as a result of Qingdao Port’s refusal to deliver the metals. Meanwhile, HSBC and ABN Amro Bank sued Chen Jihong, the Singapore national said to be at the center of a probe over whether metals were pledged multiple times as collateral for loans. He has been detained in China. HSBC has asked Singapore’s High Court to liquidate Chen’s Zhong Jun Resources after it failed to repay USD4.3 million. ABN Amro won an order for Chen to pay USD22 million owed under a loan agreement with Zhong Jun and another of his companies. Yu Shengping of Qingdao Port International’s Legal Department, told the South China Morning Post that all parties would have to wait for the result of the criminal investigation before there could be any meaningful progress in civil actions. “This incident has brought damage to the reputation of Qingdao Port. We are also victims,” said Yu. The court held its first hearing earlier this month. Commodity financing has come to the fore because millions of dollars were lent by banks to groups or firms using metals or agricultural goods as collateral. Lenders are deeply worried that in some cases, the same commodity was used for loans multiple times.

Swire Pacific Cold Storage, the world’s third-largest in terms of capacity, inaugurated a CNY440 million facility in Shanghai as the company continues to expand into China’s rapidly growing cold chain logistics industry. The facility in Fengxian district has a capacity to provide 50,000 pallet positions, or 354,000 cubic meters of temperature-controlled space. It is the company’s first wholly-owned property on the Chinese mainland. “The opening of this new facility, one of the largest and most advanced of its kind in east China, is a significant milestone,” J.B. Rae-Smith, Swire Pacific’s Executive Director of the Trading & Industrial Division, said at the opening. “Our long-term plan is to build a nationwide cold chain logistics network of 13 large-scale cold storage facilities by 2020.” In addition to the Shanghai facility, Swire Pacific’s new facility in Langfang, Hebei province, is having trial operations. Two more cold storage facilities are under construction in Nanjing, Jiangsu province, and Ningbo, Zhejiang province. A third is being planned for Chengdu, Sichuan province. All these facilities are scheduled to commence operation between 2015 and 2016. The company’s first facility on the Chinese mainland, a joint venture with Guangdong Foodstuffs, started operations in 2008.