02


House to House July 2010


Astable outlook


While the global economic conditions prevailing for the last eighteenmonths have created considerable trading uncertainty in the international freight transport sector, there is evidence of an upturn in trade flows. Recently, in the container trades, high growth levels have been recorded albeit in some areas froma very lowstarting point.


On theAsia-Europe trade the ELAAreports a May year-to-date (YTD) increase on last year of nearly amillion TEU; the total carry- ings reaching5.38millionTEUjust 5%down onpre-crisis2008levels. Whileonthetrans- Pacific trade, AXS Alphaliner figures show the highest eastbound June liftings ever; thetotalof 1.23millionTEUwashigher than the previous record in 2007 and 32%up on the samemonth last year. The longer trend onthisbenchmarktradeisalsohealthywith June YTD growth of 18%over 2009.


Despite this emerging picture a question mark hangs overwhether the increases being observed represent sustainable growth. Commentators have speculated thatmuch of the extra container business recorded in recentmonthsmay bemore in the way of inventory replenishment and only in small part a product of increases in consumer spending. In general, volumes have still not re- turned to levels prior to the dramatic economic down-turn. One leading industry figure com- mented recently in the media that both shipping lines and terminalswould continue to tighten their belts in adapting to ‘the new normal’ that will be characterised by strong cost management and slow growth. Add to this economic picture the regulations surroundingOFAC(page 12) for any- one trading with the US and the UN Security Council sanctions (page 03) and it is easy to see why a return to economic growth might take longer than some of us had first thought.


A similar situation is also true of the insurance in- dustry that serves the transport world. Prudence and cautious expansion in well defined sectors appear to be the way forward. TT’s market posi- tioning in this respect is well defined and clearly appreciated byAMBest our rating agency. In this context I amproud to direct you to page 13where you will find a copy of our recent press release


confirming our AM Best rating of A- Excellent with a stable outlook.


In tandem with our AM Best rating, I am very happy to report that the initial results of this year’s customer satisfaction surveywhich is used tomonitor howwellwe are performing in the de- livery of service and product to our customers, has recorded an excellent overall result of 8.1 out of 10. This is based on a scale ranging fromdis- satisfied to satisfied where 10 indicates perfec- tion. A detailed breakdown of the results will be sent to all those who participated during the next few weeks and a summary will be available on the Clubs website. I would like to take this opportunity to thank all thosewho kindly took the time to help uswith our survey. Your opinions are important and we make every effort to use your feedback to refine service delivery and product development.


While TT’s chosen sector for sales growth is transport and logistics we are also seeing de- velopments in a sector that we have vast expe- rience in – that of chassis insurance. The article on page 10 sets out some of the emerging is- sues in that sector and explains why TT is well positioned to support its existing membership and is centre stage to offer cover to new en- trants to this sector.


The transport and logistics sector continues to respond to demands fromits client base to save costs by refining supply chains, both in terms of efficiency and adaptability to change. Logistics operators seemto be doing this by out-sourcing various functions, such as warehousing, distri- bution and inventorymanagement but there is a cautionary note here. We recommend all our Members not to forget the importance of secu- rity when rationalising operational procedures. Indeed, I urge you to read the article on page 04


entitled Securing your supply chain which dis- cusses the issue of security and provides detail on how to access the Clubs new booklet Sup- ply Chain security – Management initiatives & technologies.


On a similar note the item on page 06 entitled Keep safety handy in your pocket drives right to the heart of theClubs value adding ability because it highlights the need for increased awareness on three critical subjects that are central to the op- eration of most parties involved in the movement of goods. The Club has recently produced a se- ries of pocket guides aimed at providing essential information for operational staff on the subjects of; the IMDGCodeRequirements, the safe operation of slings when lifting cargo and the precautions that should be taken when entering confined spaces,whether in terms of bulk or containerised operation. Similarly, we are grateful to Fiona Hobbs and Trevor Harris of DPWorld who have contributed the text on page 05which focuses on the safe operation of straddle carriers.


I hope you find this issue of h2h both interesting and useful. I have not highlighted all the articles so please do take the time to read the others aswell. Finally, on a lighter note, I draw your attention to an activity involving the use ofmetal sticks in an ef- fort to thrash a whole series of little white balls around a patch of grass desperately attempting to avoid a series of small inland beaches whilst try- ing to make the balls disappear down tiny round holes. The central pages of this issue are de- voted to a photo record of the annual TT Club London broker golf day hosted byAndrewHuxley on18May. Thewinnerwas Patrick Jordan ofUIB and I would like to thank all those who attended for their sportsmanship and company on what was an excellent day.


Charles Fenton, CEO, TT Club


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