LOGISTICS INDUSTRY CONCERNS OVER SULPHUR SUBCHARGE FOR IRISH SEA SHIPPING ROUTES F
TA Northern Ireland is concerned that businesses shipping goods via the Irish Sea
are set to be faced with additional surcharges from shipping lines, which will make the cost of doing business with GB and Europe more expensive for Northern Irish businesses. The additional transport costs – estimated by
FTA to be around £21 million per annum – are attributed to the cost of adaptation measures to comply with the new sulphur oxides targets entering into force worldwide from 1 January 2020. Mandated by the United Nations regulatory body for shipping, the IMO, these rules will require the sulphur content of marine fuel to be no higher
than 0.5 per cent (mass percentage). “Surcharges are a bad response to this
change” says Seamus Leheny, FTA’s policy manager for Northern Ireland. “While the industry has been expecting increased costs as a result of the new rules around low sulphur fuel, a new surcharge mechanism seems unnecessary. This is the new normal, so shipping companies should be including this in normal commercial pricing arrangements.” FTA is opposed in general to the use of
surcharges in the shipping industry. The Association sees these as an old-fashioned hang- over from a previous era. Managing input cost
changes is a normal part of business and can be dealt with through fuel cost adjustment factors, or just anticipating the likely cost to come and including it in contract prices. Leheny concluded: “These changes have been
known about for a long time and could have been factored into all business plans for 2020. They are not temporary, nor are they different to what is being done anywhere else in the world. FTA wants the shipping companies to move away from this approach as quickly as possible as we see no need for this additional charging mechanism.”
www.fta.co.uk UNITE PUBLISHES BLUEPRINT TO TRANSFORM UK MANUFACTURING T H
ello readers and welcome to
the November issue of Irish Manufacturing, the last of 2019. In this issue we focus on power tools & tooling equipment and take a look at HVAC, Industry 4.0, order picking and much more. If you are interested in contributing to a future issue, please contact myself or Rhea for our 2020 media pack. For now I would like to take
the opportunity to thank you for another year of support, and wish you all a happy new year. Rachel Tucker - Editor
he Manufacturing Matters document was launched at Unite’s sixth sector conference in
Brighton. Long-term plan The document details a long-term industrial plan, which provides a route map for industry. It is rooted in trade union and labour values and its aim is the delivery of a strong, diverse economy providing secure, skilled jobs. At the heart of the strategy is the need for a
sustainable manufacturing sector based on an ambitious 10 point plan that includes investment, defending foundation industries and crucially, a demand that we ‘Build local - Buy UK’ supporting jobs, skills and communities relying on a strong manufacturing sector. Procurement budget Unite assistant general secretary for manufacturing Steve Turner said: “We have in our hands the power to make sure that government at every level uses its procurement budget to support British manufacturing and its extended supply chains. “We can and must bring back the thousands of
manufacturing jobs that moved overseas in order to shorten supply chains and reduce our overall global
carbon footprint — and we need a “just transition” to new green sustainable jobs. Workers must be leaders in our industries and trade unions must be on the frontline of the green industrial revolution. “Guaranteeing high quality vocational
apprenticeships and lifelong learning are also key. Workers must have the opportunity to learn new skills and develop during downtimes without loss of pay in a radical shake up of working time. “With regards to automation and artificial
intelligence, the next industrial revolution can either herald a dystopian future or it can enrich our lives, freeing us to fulfil our true potential as human beings. Only with a strong, determined and confident trade union voice will this next industrial revolution benefit workers and wider society. “Sectoral collective bargaining, true industrial
democracy and new corporate ownership models providing a collective voice for working people via their unions are central to the long-term future of advanced, sustainable manufacturing. “Our strategy for manufacturing lays out such a
vision and we call on our movement to get behind its delivery.”
MANUFACTURING ACTIVITY SHOWS SLIGHT RECOVERY BUT IS STILL WEAK T
he CBI survey of 307 manufacturers found that total order books improved on
October (when they were at their weakest in nine years) but remained significantly below their long-run average. Export order books also strengthened on the previous month (when they were at their weakest since the financial crisis of 2008) but also continued to be below the long-run average. Output volumes fell at a similar pace to
October, with output expanding in only five out of 17 sub-sectors. The headline fall in output volumes was driven largely by the motor vehicles, metal products, and metal manufacture sub-sectors. Meanwhile, the main positive contributors to output were the mechanical engineering and plastic products sub-sectors, alongside a boost from aerospace output. Looking ahead, firms anticipate output volumes to be flat in the next three months. Manufacturers reported that stocks rose further
above ‘adequate’ levels. Meanwhile, firms expect output prices to be flat in the next quarter. Across the economy more broadly, growth has
been volatile during 2019, driven by businesses shifting activity in response to moving Brexit
deadlines. We expect the economy to grow modestly in the event of a smooth transition to a new Brexit deal, with the longer-term economic impact dependent upon the details within the final deal. Anna Leach, CBI deputy chief economist, said:
“While the thick fog of uncertainty from a No Deal Brexit has lifted somewhat, the manufacturing sector remains under pressure from weak global trade and a subdued domestic economy. Order books remain below average, and output volumes continue to fall. When taking into account the deteriorating outlook for manufacturing globally, it’s clear that the outlook for the sector remains precarious. “The General Election is an opportunity for all
parties to explain how they will shore up our economy. Ratifying a Brexit deal and moving on to build a vibrant future relationship with our biggest trading partner, based on frictionless trade, will be vital – both for UK manufacturers, and business as a whole.” Key findings: •13 per cent of manufacturers reported total order books to be above normal, and 40 per cent said they were below normal, giving a rounded
balance of -26 per cent (up from -37 per cent in October). This remains well below the long-run average (-13 per cent) •13 per cent of firms said their export order books were above normal, and 35 per cent said they were below normal, giving a balance of -22 per cent – below the long-run average of -17 per cent but stronger than October (-41 per cent) •26 per cent of businesses said that the volume of output over the past three months was up, and 34 per cent said it was down, giving a balance of -nine per cent. This decline was in line with that seen in October (-10 per cent), and below the long-run average (+four per cent) •Manufacturers expect output to be broadly flat in the coming quarter, with 24 per cent predicting growth, and 25 per cent a decline, giving a balance of -one per cent •Average selling prices for the coming three months (-one per cent) are expected to remain steady •21 per cent of firms said their present stocks of finished goods were more than adequate, whilst three per cent said they were less than adequate, giving a rounded balance of +17 per cent – slightly above the long-run average (+13 per cent).
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