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Shipping data shows that Iranian bulker ships sail from Gulf despite the war
Ship tracking data revealed on Thursday that Iranian dry bulk'vessels' are trying to transport their cargoes through the Gulf to the export markets for the first time since the U.S. launched an attack? on Iran at the weekend. Since the start of the conflict, international shipping has been largely shut out of Strait of Hormuz. Vessels are wary of being shot at. According to MarineTraffic, two Iran-flagged?bulk ships - the Parshad? and the Parisan? - left Iranian port Bandar Imam?Khomeini? and Bandar Abbas on Thursday and were on water heading towards Kuantan in?Malaysia. The two ships that were sanctioned by the United States had previously transported iron ore - used to make steel - from?Asia to China, one of the largest producers of the metal in the world. Both vessels were in the exclusive economic zone of Iran, which extends to up to 38 km (24 miles) and is beyond local territorial boundaries of 12 nautical mile. This could have provided them with protection from attacks while they attempted to pass through Hormuz. The U.S. sub sank a warship of the Iranian navy in international waters off Sri Lanka on Wednesday, killing 87. Ship-tracking data showed that a third dry bulk vessel, Liberia's Lacon, left Bandar Imam Khomeini on its way to Santos, Brazil, where a major soybean loading terminal is located. Alphamar data reported that ten ships will be leaving Brazil in the coming days with more than 600,000.0 tons of soybeans and soymeal. However, it is possible the cargoes could be diverted. (Reporting and editing by Veronica Brown, Susan Fenton and Tom Daly)
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Advent rejects Senior bid, which valued UK Engineer at $1.52 Billion
U.S. Private Equity Firm 'Advent International' has revealed its rebuffed takeover offer for British aerospace engineering firm Senior Plc. The?company is valued at around 1.14 billion pounds ($1.52 million), or 272 pence each share. The shareholders would be entitled to a final dividend of up to 2 pences for fiscal year 2025. Advent's offer is a 5.6% increase over Senior's closing price of February 26, the day before Advent made its approach. Advent confirmed that it is one of the interested parties in Senior. It has until 27 March to decide if they will?make an offer firm' under UK takeover regulations. Senior, a supplier of aircraft?parts to Boeing and Airbus said that it received five proposals in February. At the time, three bidders, Tinicum Blackstone, Advent and Arcline Investment Management, were identified. Senior and other bidders?have not yet disclosed the value of the?bids.
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State Dept. says that flights for US citizens trapped in the Middle East are increasing.
After criticism of the Trump administration’s initial planning and assistance to U.S. citizens who were trying to leave the Middle East since the U.S. - Israel war on Iran started, the U.S. State Department announced on Thursday that it was 'intensifying the provision of charter flight services' from the Middle East. Airspace has been closed in the entire region due to the strikes which began on Saturday, and Iran's retaliatory actions against its neighbors. The Department of State, led by Secretary Marco Rubio, announced Wednesday that the first U.S. Government charter flight?left the region bound for America, but gave few details. Dylan 'Johnson, Assistant Secretary of State for Global Public Affairs and a spokesperson for the Department of State, said that additional flights and ground transports will be taking place today under the direction of SecRubio. Charter flights were not known to depart from which countries. Johnson advised that American citizens living in Kuwait, Bahrain and the United Arab Emirates as well as Qatar, Saudi Arabia and Israel, should complete a crisis intake form for information on upcoming flights and ground transportation options. He added that a task force had provided guidance to more than 10,000 Americans since the crisis began. As tensions grew, the State Department only warned U.S. citizens in Israel and Lebanon, but Iran has responded by targeting U.S. civilian infrastructure and missions in many other?places. This includes Gulf Arab nations, which are major transportation?hubs. After the conflict started, U.S. Security Alerts were sent to Americans in Kuwait and the United Arab Emirates. They also went out to Americans in Iraq, Qatar, Bahrain, and the United Arab Emirates. The?U.S. on Monday urged Americans ?across 14 countries in the Middle East to immediately depart the region using "available commercial transportation" without offering any U.S.-government-vouched means, drawing the ire of U.S. lawmakers.
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Israeli ambassador says that in a few short days, it will be more difficult for Iran to interfere with shipping.
Israel's ambassador at the United Nations stated?on Thursday? that it would be much more difficult for Iran to disrupt vessels that are?coming through?the Strait of?Hormuz? and that the?volume? of missiles fired by Tehran is already declining. Danny Danon, speaking to reporters at the United Nations in New York, urged Israelis to be patient as it would only take a short time for Iran's missile fire to be?minimized' and its military capability to be dismantled. Danon said that the results of hundreds of missile attacks on Iranian launchers are showing. "You saw around 100 missiles at the start of the war ending up in Israel. You are now talking about 20 or so. "I'm certain we will see that going in this direction," he said. Every day, the?capabilities of their adversaries are reducing. Together with the U.S. we degrade, destroy, and dismantle launch sites and stockpiles every hour. We are six days into the operation and already, we have seen a reduction in the number of missiles that are being fired. Danon stated that Iran was becoming weaker, and it wasn't yet time to engage in diplomacy. He said, "I believe diplomacy is going to be put into action (but) it's not quite there yet." "We must finish the job. We must continue. It won't take months, but it may only be a few weeks or days. We must continue to hammer and dismantle capabilities. Then, we need to use diplomacy in order to make sure that others are not doing the same. Danon stated that when Iranians look up at the sky, they can only see Israeli and American aircraft. He said, "We must be patient." "Give us a few days more and it will be much, MUCH harder for the Iranians disrupt the vessels that are coming through the Strait of Hormuz." (Reporting and Editing by Bill Berkrot.)
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The U.S. railways can now win back freight because of the limited truck capacity.
As trucking capacity is tightening and road haul rates are rising, U.S. rail companies such as CSX Corp., Union Pacific and BNSF are attempting to capture freight from trucks. Low trucking rates and increased flexibility allowed road carriers to capture cargo that would have otherwise been transported by rail. This weighed on?rail volume and limited pricing power. This?dynamic has now shifted, at least temporarly. Freight ?broker ?C.H. Robinson stated that trucking capacity is decreasing as small carriers leave the market, and as federal scrutiny of driver licenses, safety and insurance requirements increases. This added pressure reduces the supply of drivers and increases operating costs. According to DAT Freight & Analytics (a benchmark for spot market pricing), the national van spot rate rose from $2.03 per mile a year ago to $2.43 in February. Because railroads don't publish spot rates that are standardized, direct comparisons can be difficult. Fadi Chamoun, analyst at BMO Capital Markets, said that a tightening truckload markets could support intermodal volumes and prices in the domestic market. This is especially true on shorter routes with a longer average distance where there's a lot of competition from over-the-road trucks. The battleground for intermodal freight is between the two sectors. This involves cargo that is transported in containers and can be moved between trucks, ships and trains. BENEFICIAL PRINCIPALS Chamoun stated that eastern railroads CSX Corp. and Norfolk Southern would benefit disproportionately due to their greater exposure to intermodal freight in densely populated areas. CSX said that converting freight from trucks is a top priority for their intermodal business. It now sees "opportunities" to capture profitable volume after years of excess capacity on the highway. The company stated that it was working with port authorities and expanding terminals to create inland hubs nearer to end markets. Union Pacific's Chief Financial Officer Jennifer Hamann said at a Barclays Conference that she expects 75% of the new business growth will be coming from "off the highway." The company said that the pending purchase of Norfolk Southern by its parent company, which would create the first coast to coast rail network in America, could ultimately remove 2 million trucks off U.S. highways. BNSF, owned by Berkshire Hathaway, has announced that it has invested in terminal 'expansions' in Chicago and Dallas-Fort Worth as well as Phoenix in order to prepare for a possible rebound. Jon Gabriel, vice president for consumer products at the group, said that both new shippers as well as our traditional large customers were leaning on rail to take advantage of its capacity, lower costs and benefits in terms of sustainability. He said that the Los Angeles to Chicago corridor would be a major driver of growth, as it will allow freight to move off the highways. STRUCTURAL CHANGE - OR CYCLICAL Drew Roy, Director of Intermodal at freight broker Traffix said that what initially appeared as a "seasonal tightening" in trucking capacities may reflect a more profound shift. "A few months ago, I would have thought this was seasonal. "But with the loss CDL (Commercial Driver's License), I think we're experiencing a structural change," he said. He noted that capacity started tightening in mid-January, as winter storms struck and spot rates rose. Roy explained that intermodal rail needs a cost advantage of about 15% to be competitive. However, as truck prices rise, rail is becoming more competitive, even on short hauls up to 750 miles. He warned that the advantage might not last. Roy noted that when truck capacity increases, the pricing power tends to swing back towards highways.
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Bunge explores alternative routes amid worsening shipping crisis in the wake of Iran war
Bunge, the global grains trader, is looking at alternative shipping routes to reduce disruptions caused by the Middle East conflict. The company has not provided details about any alternate routes but said that it has seen so far a "limited impact" on its ocean-going ships. After U.S. and Israeli strikes against Iran, the Strait of Hormuz has been severely constrained in terms of trade. The International Grains Council estimates around 22 million metric tonnes?of grain, oilseeds, and products deliveries into the Persian Gulf flowed through the Strait of Hormuz in the last five years. This represents about 3% of the global trade. Bunge's logistics network handles shipments of fertilizers as well as grains, oilseeds and grain products. Analysts warn that the Strait is responsible for 25% to 35%?of?the world’s raw-material fertilizer trade. Its closure could disrupt?supply chain and increase production costs, a rise that would?ultimately?be felt?by consumers. Nutrien, Canada’s largest agricultural chemical company, announced on Wednesday that it is?closely engaging with customers as the conditions in?the Middle East continues to evolve. Commodities traders Trafigura and Glencore declined to comment on ?any impact from the ?conflict, while Bunge rivals Archer-Daniels-Midland ?and Cargill did not immediately respond to ' requests for comment. Reporting by Sumit S. Saha in Bengaluru, Katha Kalia in Chennai and Vallari Srivastava at the University of California. Editing by Shilpa Majumdar
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Zelenskiy claims that the Druzhba pipeline could be restarted in about a month.
Volodymyr Zelenskiy, the Ukrainian president, said that in one month and a quarter it may be possible to re-start a damaged Druzhba?pipeline. It is difficult to find alternatives, so the European Union has not imposed sanctions on Russian oil. In response, Hungary has taken steps to obstruct EU assistance for Ukraine. Both countries have accused Ukraine of being slow in repairing its infrastructure - something Kyiv denies. Zelenskiy was speaking at a press conference in Kyiv where Sergii Koreteskyi, CEO of the Ukrainian state energy company Naftogaz said that the main pumping station for the pipeline had been damaged by the attack. Zelenskiy claimed he didn't want to restart Druzhba, because it transports Russian crude oil. However, Kyiv may have no other choice if the only way was to reopen the line in order to unblock an important EU aid package. Zelenskiy said to reporters that "we can give the information that repair is possible within a month and a half, if EU countries have no choice but to block funding for our military because we supply Russian oil in Hungary and Slovakia." After a meeting of his top officials from the government and parliament, he stated, "We will prepare all and then make a decision accordingly." DISPUTE OVER OIL SUPPLIES The dispute erupted after deliveries were stopped on January 27?when a Russian strike damaged infrastructure in west Ukraine. Ukraine continues to transport oil to Hungary, Slovakia, and the other EU countries that still import Russian crude despite the ongoing war. Global?energy prices are soaring since the U.S., Israel and other countries began airstrikes against Iran last weekend. This has disrupted oil and gas supply. Hungarian Prime Minster Viktor Orban has threatened Ukraine, a pro Moscow leader who faces?elections in the next month, with "political tools and financial instruments" to force it to reopen its pipeline. Hungary also delayed the approval of an EU funding package worth 90 billion euros ($104 billion) for Ukraine insisting on a resumed shipment. Zelenskiy stated that there were no other financial options available to a cash-strapped Ukraine. Koretskyi, Naftogaz, said that repairs were in progress, but the damage was extensive. This included the pumping station and electronics. The work will take some time. Koretskyi said that Ukraine is evaluating funding requirements for underground reservoirs due to Russia's ongoing attacks.
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Main union: Seafarers may refuse to sail in the Mideast Gulf region
The leading shipping and labour groups have said that seafarers are entitled to refuse to sail on ships traversing the Middle East Gulf, which includes the Strait of Hormuz. This is because the threat level in the region has been raised to the highest level. As the U.S. war against Iran intensifies, around 300 ships are anchored both sides of the Strait. Nine ships have suffered damage since?February 28 and one seafarer has been killed. According to the International Bargaining Forum, a group of mariners, commercial shipping companies, and maritime unions, reached a negotiated agreement on Thursday. Seafarers can refuse to enter the area and receive compensation equivalent to two months’ basic wages and repatriation costs. The International Transport Workers' Federation said that in addition to receiving higher wages, compensation would be doubled if they died or became disabled. Stephen Cotton, ITF's General Secretary, said: "Today’s designation provides critical protections to seafarers aboard vessels covered by IBF agreements if they are operating in this dangerous region." "The fact that we are taking these?measures is a damning?indictment of the?situation facing seafarers in today's world." No worker should be forced to take the risk of being 'killed or injured simply because they are doing their job, especially when that job involves transporting goods and oil which keep the global economy running. Reporting by Jonathan Saul, Editing by Andrew Cawthorne & Andrei Khalip
McKesson names Sysco CFO Cheung as Vitalone retires
Kenny Cheung, the finance director at food distributor Sysco, will succeed Britt Vitalone.
Vitalone has been with the firm for more than 20 years and served as its CFO for eight of those years. He will continue to serve as a strategist, supporting the transition, as well as the planned separation of the business.
Evercore ISI analyst Elizabeth Anderson said that today's announcement had a "feeling of an end of an era" to it. She added that Vitalone helped McKesson navigate through the COVID-19 disruptions as well as the opioid litigation settlements.
The shares of the largest U.S. drug distributor fell 5% this morning. The stock had gained six-fold in the time that Vitalone was at the helm.
Michael Cherny, analyst at Leerink Partners, said that any sudden changes for a company which has outperformed for many years can raise some questions in the short term. However, the strength of its portfolio and the depth of its operating bench allows for a smooth transition.
Anderson stated that Cheung's "cultural fit" with McKesson will be "good", adding that he helped the company to execute more consistently after a period of misexecution.
He previously worked as the finance director at Hertz, a car rental company. Cheung will begin his new job at McKesson on 29 May.
Sysco also announced that Cheung would remain at the company until April 17.
McKesson's C-suite changes coincide with its reliance on specialty drug distribution and oncology to drive growth.
(source: Reuters)