The Xian International Trade and Logistics Park aims to become “the largest inland international port, the largest trade and logistics center in the upper and middle reaches of the Yellow River and a new base for the modern services industry”. It comprises eight functional areas: the container operation area, the comprehensive free trade zone, the domestic trade area, the comprehensive services area, the residential area, the logistics area, the industrial area and the coordinated urban-rural construction area. It has convenient railway, highway and air transportation links. The Xian Comprehensive Free Trade Zone, covering an area of 6.18 square kilometers, is the only free trade zone in the northwestern region of China. It is supported by the logistics and port functions of the trade and logistics park. Xian Vice Mayor Han Song said that the functions of a normal port, such as customs clearance, could be performed just as well inland, where there is convenient access to railway infrastructure. “Thanks to the Xian International Trade and Logistics Park, all export-oriented enterprises in the northwestern region will no longer have to go to coastal ports to complete customs procedures, and in Xian, they could also enjoy all policy benefits, such as tax rebates. Furthermore, processing enterprises could move their production to this inland region,” Han said. To provide easy and convenient transportation, the park enjoys the full support of the Xian railway container transport center, the Xian bonded logistics center and the Xian highway hub, and it has also established “strategic cooperative relations” with the major coastal ports in Shanghai; Tianjin; Qingdao and Rizhao in Shandong province; Lianyungang in Jiangsu province; and the border ports of Horgos and Alataw Pass in Xinjiang. The park also established offices in Istanbul and Rotterdam.

Contact information:  Administrative Committee of the Xian International Trade and Logistics Park, No 6 Gangwu Avenue, Xian International Trade and Logistics Park, Xian, Shaanxi Province, postal code: 710026 Website: www.itl.gov.cn Telephone: 86-29-83591918 (daytime), 86-29-83332466 (nighttime).

The Ministry of Transport warned that transport infrastructure funding faces difficulties this year, after investment in roads, railways and other transport infrastructure all fell in the first quarter. “We are not optimistic about the ability of local governments to contribute their share of funds,” the Ministry said. During the first quarter, fixed asset investment in highways and waterways fell 7.7% year on year to CNY185.4 billion. Investment in road construction dropped 9.5% to CNY157.5 billion; investment in rural road construction decreased 8.8% to CNY18.6 billion. Investment in rivers and waterways plummeted 43.7% to CNY8.4 billion. In the first quarter, fixed asset investment in the sector fell 10.2% year on year in the east, 12.9% in central China and 2.9% in the west. Fixed-asset investment in China’s railways plunged 51% to CNY59.63 billion during the first quarter, according to the Ministry of Railways (MOR).

Pacific Basin Shipping, which specializes in transporting dry bulk cargoes including fertilizer and steel, was expecting a rebound in demand and volumes in the second quarter that should temporarily buoy charter rates, the firm said. But Executive Director Andrew Broomhead added: “We still expect freight rates in 2012 will be weaker overall than in 2011 due to the continued influx of new capacity at slower, though still strong, Chinese growth and uncertainty in world trade. We still consider dry bulk shipping to be in crisis, with excess ship supply and a lack of traditional financing for second-hand vessel acquisitions.” The first quarter was adversely affected by bad weather in Brazil, India, Australia and other countries which disrupted cargo loading operations. While the firm’s contract cover had increased, the average daily charter rate had fallen since the beginning of the year which reflected the poor market conditions. It had 103 Handysize ships of up to 40,000 DWT in its fleet in the first quarter. Some 54% of Handysize revenue days were fixed at an average charter rate of USD11,480 per day on December 31. But while this had risen to 66% of revenue days on April 16 the rate had fallen to USD10,840 per day. Broomhead said the increment increase in vessel cover had been added at a charter rate of around USD9,000 per day. This was higher than the market rate for Handysize ships which fell to about USD5,000 per day in mid-February. Average charter rates for the firm’s fleet of 39 larger Handymax vessels had risen since January to reflect the increase in contract cover, which rose from 75% to 81% from January to March, and higher lease rates. Pacific Basin Shipping made an USD80 million impairment on its six ro-ro ferries last year to reflect the weaker outlook in the charter market and the ability of the firm to deploy ships profitably. Broomhead said four of the six ships were on charter mainly at low rates, while it was seeking charters for the two others. He said the priority this year “is to secure the best possible employment and utilization for our ro-ro fleet”, the South China Morning Post reports.

Pacific Basin Shipping is putting a “For Sale” sign on its non-core shipping operations to focus on profitable dry bulk and towage businesses, senior executives said. The potential disposals include its loss-making roll-on/roll-off (ro-ro) ferry operation in Europe, port investments in China and Canada and shareholdings in public companies, said Chairman David Turnbull, adding that the exits would come when the time was right. Turnbull said the six ro-ro ferries were “non-core”, but added: “To exit now when the market is at the bottom seems crazy.” Pacific Basin ordered and acquired the ships at a cost of USD549 million when it entered the ro-ro market in early 2008 to diversify into other shipping sectors. Broomhead said the ro-ro business “continues to be a major challenge” after making a USD10.6 million net loss last year. As of April 16, the six vessels have been leased for only 36% of an available 2,180 days this year, at an average daily rate of USD19,380. Broomhead said the challenge was “to find employment in the European market” for the unchartered ships. Pacific Basin’s main port investment is a 45% interest in Longtan Tianyu terminal in Nanjing, which was acquired in 2007 for USD16 million through associate company Asia Pacific Maritime and Infrastructure. The Nanjing operation is included in Pacific Basin’s other operations which posted a USD2.68 million net loss last year on revenue of USD915,000.

Chinese insurers could take a bigger role in covering supertankers carrying crude oil from Iran to China when the European Union introduces tougher sanctions on Iranian oil shipments from July 1. Western insurers cover about 90% of the global tanker fleet including ships operated by Cosco Dalian, China Shipping Development and Nanjing Tanker. Insurance experts said Chinese insurers such as PICC, China Taiping Insurance and Ping An Insurance already offered marine insurance in China. If Chinese insurers were to cover tankers transporting Iranian crude and petrochemicals to China, they would likely seek support from state owned China Reinsurance (Group). Arthur Bowring, Managing Director of the HK Shipowners Association, said Iran would likely cut the cost of its crude oil to encourage foreign buyers, while tanker owners willing to transport it could see charter rates double or triple.

Hong Kong shipowners could be poised to invest heavily in new fuel-efficient ships at rock-bottom prices, despite ongoing concerns about overcapacity and uncertain cargo growth, according to industry insiders. “By the second half of this year you will see Hong Kong owners seriously looking at acquiring tonnage,” said Kenneth Koo, head of tanker and dry cargo operator Tai Chong Cheang Steamship. The comments were echoed by shipping brokers and lawyers who said there was evidence of renewed interest being shown by Hong Kong owners in replenishing their fleets. “According to owners we’ve talked to, everything is on the table. This includes new and secondhand ship purchases,” said a shipping lawyer. Hong Kong owners were looking at the possibility of ordering on their own account or as joint ventures with other companies, he added. Shipbrokers said owners were particularly interested in acquiring more fuel-efficient ships that were “lighter and greener”, and shipowners including Chellaram Shipping and Pacific Basin Shipping had expressed a desire to expand their fleets if the right deal was available. Ship prices were presently at the bottom of their price cycle, Einar Straume of Rodskog Shipbrokers said. Many Hong Kong shipowners held back from ordering new ships as prices surged in line with a rapid rise in charter and freight rates up to early 2008. But since then prices have slumped. Martin Rowe, Managing Director of shipping services provider Clarkson Asia, said new fuel-efficient ships were attracting a lot of interest among fleet operators. A Japanese-designed and built 82,000 DWT dry cargo ship could be 3,000 tons lighter than a vessel with a similar cargo capacity built in China, he pointed out, and the lighter vessel would consume less fuel, making it more attractive to charterers who leased the vessel to haul cargo.