Introduction

I began the last (May) Newsletter with the words "summer is grudgingly approaching" in Europe. Well, shortly afterwards summer really did come and we enjoyed temperatures in London of 100 °F, which do not well suit the Central Line Underground!

Iraq remains a deeply unsolved and worrying situation. It is clear that the Post-fighting scenario was not thought through and is causing profound problems and loss of lives, British and US particularly, but also of Iraqis and other nations serving the UN and Red Cross. The Iraqi Oil output is under constant threat and is having a considerable effect on fragile tanker rates.

SARS happily is in the past though I for one am not yet clear as to its origins and its future as possible long-term threat. It certainly cost Hong Kong dear and Adrian Swire recently told me of the frightening daily haemorrhage of losses of Cathay Pacific as an example.

Shipping has had a pretty good quarter - even the Container Trades over which I had special misgivings have moved into profitability though, as Maersk-Sealand have recently reported, this is due more to restoration of Container movements than to improvement in rates.

It is important to consider the longer-term problems confronting us all.

The activities of the EU.

The unilateral behaviour of the EU in relation to Maritime Affairs remains a distinct problem although it is good that more discussion appears to be happening with IMO. The EU position regarding Single Hull Tankers remains and has understandably recently drawn a furious denunciation from the Greek Shipo\vners' President Nicos Efthymiou and incidentally has led to the displacement of the Greek Minister of merchant marine, Mr Anomeritus who, it was felt by the owners, had behaved in a pusillanimous way on the issue during Greece's Presidency of the European Union. He had permitted endorsement of an accelerated phase-out of Single Hull Tankers.

Others who are less than happy with the EU are the Asian Shipowners. They equally feel that European Politicians have ignored the interests and opinions of the Asian Maritime Community where after all, most of the World's ships are built and more than half are operated. As a persona] comment I would agree with these sentiments, at the same saying that too few Asian Shipowners remain Members of IMIF and if more did join/rejoin we could do our bit to ensure that their views were properly taken into account.

Shipbuilding

Shipbuilding has had a very busy year. Korean yards have been booked solid and made record deliveries at - to put it euphemistically -"supremely attractive" prices. Japan yards have also had a good year though now staying way behind Korea.

But the "new" force in this and in so many things is China. Their ability to produce quality ships - assisted by technical advice from Japan and Korea - has grown exponenti ally. Already forecasters are predicting that China could seriously outstrip Japanese and Korean yards as early as 2005. The forecast was made before China State Shipbuilding Corp announced its plan to build a $2.4bn shipyard at Chanxing Island. But the study said the creation of CSSC, together with the China Shipbuilding Industry Corp, which consolidated 50 smaller shipyards into two large enterprises, has helped provide the catalyst for change. Dalian New Shipyard recently reported that turnover had climbed to Yuan 17.4bn ($2.12bn) in the first half of this year. This compared with turnover of Yuan 11.6bn for the whole of last year.

On a visit to China in the mid 90's the Chairman of China National Shipbuilding told me that the work-force in his yards was over 600,000. I have no idea what it is today and whether it has gone up or down, the latter being achievable by greater technical advance, robotics etc.

It is surely a situation to be watched

Scrapping

This has certainly been a busy period for scrapping. As I write there is news of a Papachristidis vice going to Indian breakers for a healthy S237 per lwt.

I recently had out of the blue an approach by e-mail from the President of China National Shipscrapping Association. They are old IMIF members who have been somewhat distant but are now seeking advice and discussion on the present and future of shipbreaking worldwide. We are entertaining their large-ish delegation to lunch here at the Baltic on 11th September, to which we have asked a number of our Shipbroker members.

Another planned event is an IMIF delegation to Breskens in Holland to be hosted by Peter Vroon. This again is to focus on Shipbreaking and the Dutch initiative in setting up a "Green friendly" Scrapyard at Eemshaven. We have invited our friend from Greenpeace Marietta Harjono and shall be addressed by Chairman of the Eemshaven initiative Doebron Mulder.

The Seatrade London International Maritime convention on 16th - 18th September will contain a Debate on the topic of 'This house believes that traditional shipowning has no future' I shall, in totally unbiased style, be chairing this clash of some very interesting speakers. The real object of the debate is to direct attention to the growing over-regulation in our industry and the erosion of the way Shipping has conducted its affairs over so many years, which many of the older hands like my self deeply regret.

Finally, I should mention our Finances which were scrutinised at the last Deputy Chairmen's meeting. We have survived another year with a "surplus", gained mainly from achieving even tighter administrative cost and no distant travelling, of some £2,000. Our loyal members have been excellent but a further 10 or so would totally solve our problems.

The saddest thing is that our wonderful maid of all work, Louise Young, is going back to her homeland, Zimbabwe, to rejoin her husband who himself recently returned there. Louise will be departing after the Annual Dinner for which she will generously stay on to assist us. We shall miss her terribly, and also her husband William, a computer expert who has voluntarily helped us through any computer glitches that occur from time to time, while Louise patiently and determinedly went about computerising the IMIF office to an acceptable modem standard during the time she was here.

J G Davis - CBE