Good for liners, bad for environmentalists

New shipping lanes between Europe and Asia are currently emerging as Arctic sea ice continues to melt at a record pace, according to Russia’s environmental agency.

Ice cover is close to a record low, opening “almost the entire northern sea route to icebreaker-free shipping” as of early August, Russia’s Federal Meteorological Service explained.

The emerging shipping routes between Europe and Asia are about one-third shorter than the traditional Rotterdam-Yokohama voyage through the Suez Canal. Although these routes will likely save shippers time and fuel, environmentalists are still alarmed.

Melting occurred “at a rapid pace through the first half of July and is now tracking below the year 2007, which saw the record minimum,” the U.S. National Snow and Data Center posted on its Web site in July.

UAE Chooses American Firm for Rail Project

First trains to run in 2013

Etihad Rail, the master developer of the UAE’s national rail project, has selected U.S.-based Electro-Motive Diesel (EMD), a division of Caterpillar, to build the freight locomotives, which will be used on the network.

EMD will design and manufacture seven heavy haul freight locomotives for delivery by 2012, with the first trains scheduled to run in 2013.

Etihad Rail, which is owned by the Abu Dhabi government (70 percent share) and the UAE federal government (30 percent share), plans to develop a 266 kilometer route for trains transporting up to 22,000 tons of granulated sulphur daily from sources in Shah and Habshan for export abroad at the port of Ruwais, the firm said.

Turkey’s Trade Deficit Hits

Record High

Imports surging despite Central Bank efforts

Efforts by Turkey’s Central Bank to tamper surging imports do not appear to be working as the country’s trade deficit hit a record high in June.

The deficit was $10.2 billion in June, up from $5.6 billion during the same period in 2010. And, the figure exceeded May’s then-record deficit of $10.1 billion.

Central Bank Governor Erdem Basci has imposed limits on bank lending to help narrow the imbalance between imports and exports, which he said would begin to yield results in the last quarter of the year.

Global Automakers on a Roll

Output to grow 10 percent in 2012

Global automakers are forecasted to produce 83.5 million light vehicles in 2012—ten percent more than the 75.9 million vehicles that will roll off of assembly lines this year.

Despite on-going uncertainty in the world economy, light vehicle production is showing “resilience with stronger than expected growth,” said the lead automotive analyst at Autofacts, the forecasting service of consultancy PricewaterhouseCoopers.

“Perhaps the most significant element to the third quarter forecast is the faster than expected recovery of the Japanese automotive value chain, with most manufacturers expecting full capacity to be restored by September,” the analyst added.

Japan is on course for an output of 8.4 million units for 2011—around 221,000 more than had been previously expected, according to Autofacts.

Chinese Manufacturing Slowing Down

July figures show 28-month low

New data from HSBC shows manufacturing activity in China contracted for the first time in a year in July to hit a 28-month low.

Monetary tightening measures were part of the reason, although rising costs for raw materials were also cited.

“We expect industrial growth to decelerate in the coming months as tightening measures continue to filter through,” HSBC chief economist Qu Hongbin stated.

Nonetheless, the world’s second-largest economy will still likely grow nearly 9 percent this year, buoyed by resilient consumer spending and continued substantial investment in infrastructure projects.

UN Report on Global Food Chain

Tons wasted due to inefficiency

The United Nations’ latest Global Food Losses and Food Waste report shows that 1.3 billion tons in consumables are wasted each year throughout the supply chain—all the way from the farm to the consumer.

Inefficiencies in the supply chain are blamed for the waste, including poor demand forecasting and market anticipation. In addition, the increasing complexity of global supply chains, along with an unpredictable economic climate, also contribute to the waste.

Canada Signs FTA with Honduras

Security, human rights issues remain

Canada has signed a free trade agreement (FTA) with Honduras, concluding 10 years of negotiations between the two trade partners.

Stephen Harper, Canadian Prime Minister, acknowledged that human rights and security problems still exist in Honduras, but explained: “We know there are significant problems of security and human rights in this country, but we have no information to suggest that those are, in any way, perpetrated by the government. In fact, the president of Honduras himself...was a prominent human rights leader in this country, and that’s got a lot to do with the fact he was elected president,” added the Canadian leader.

U.S. Trade Gap Widens in June

Imports, exports both down

The U.S. international trade deficit rose to $53.1 billion in June, up from an upwardly revised $50.8 billion in May, the U.S. Census Bureau reported in early August.

The previous estimate for May was $50.2 billion.

Trade declined on all fronts in June, with exports falling to $170.9 billion, while imports declined to $223.9 billion.

Exports, at $170.9 billion, were down $4.1 billion, in comparison to May’s statistics, while imports, at $223.9 billion, were $1.9 billion less than May.

Exported goods were $121.2 billion in June, down $4.1 billion from the month before, while exports of service were $49.6 billion, unchanged from May.

Imported goods fell to $188.8 billion in June, down $1.9 billion from the previous month. Imported services were unchanged at $35.1 billion. wt