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June 2009 Deloitte Touche Tohmatsu has opened a financial advisory office in Chongqing, its first in southwest China. The firm now has twelve offices across the country.
Deloitte said Chongqing is an engine of development for western China and that in the near future it would become one of the country’s major industrial and business centres.
The Meixi River Grand Bridge in Chongqing municipality was completed on 17 June. The 821-metre bridge forms part of the Fengjie-Yunyang section of the Chongqing-Yichang Expressway, which is due to open to traffic next year. The bridge comprises four lanes in total and will have a designed top speed of 80kph.
TNT has opened a regional road hub in Wuhan, Hubei province, which will be managed by its wholly owned subsidiary TNT Hoau. The 47,000 sq metre hub in Wuhan Dongxihu Bonded Logistics Centre will enable TNT to reduce delivery times in the provinces of Fujian, Jiangxi, Hunan, Sichuan and Chongqing municipality by up to two days, at 10 per cent lower operational cost.
TNT plans to open 10 regional road hubs in China over the next five years, which the company sees as part of a much-needed rationalisation of its fragmented logistics industry.
Tunnelling work has been completed on a new crossing under the Huangpu River in Shanghai, China Daily reported. The 2.2km tunnel connects the international shipping centre of Shanghai Port near the Bund with Lujiazui finance and trade district.
Zhang Rencai, project manager with the company that is building the tunnel, Shanghai Urban Construction and Tunnels, said the newly completed tunnel would help ease traffic congestion in the city. The Rmb1.8bn tunnel is due to open before the World Expo in May next year.
Six tunnels crossing the Huangpu have so far opened to traffic, and a further eight are under construction.
Around 13,000km of high-speed railways capable of handling trains travelling at more than 200kph could be completed and put into service by 2012, according to a railway ministry official quoted by China Daily. Zheng Jian, chief planner at the ministry, added that construction of an additional 5,000km of high-speed railways would begin soon.
China’s railways are among the main beneficiaries of the government's Rmb4,000bn stimulus package announced last year.
At least five lines will be able to accommodate trains travelling at speeds of 350kph, Zheng said. Three of them run north-south — Beijing-Shanghai, Beijing-Guangzhou and Beijing-Harbin — and two east-west — Xuzhou-Lanzhou and Shanghai-Kunming.
The five lines, along with three other lines with a designed speed of 200-350kph, will become the trunk lines of China’s future high-speed passenger rail network. So far, China has built 185km of rail track capable of handling the 350kph trains, including the country’s first such rail link, between Beijing and Tianjin, which opened last August.
Across the whole network, China built a total of 1,943km of new lines in the first five months of 2009. Over this same period, it invested Rmb168.9bn in fixed-asset investment in railways, up 120 per cent from a year earlier, according to the Ministry of Railways. The money included Rmb149bn for railway infrastructure construction, Rmb3.3bn for railway upgrading, and Rmb16.5bn for rolling stock.
Between January and May, rail cargo volume totalled 132m tons, down 4.6 per cent year-on-year, but the pace of decline has slowed down, according to ministry spokesman Wang Yongping. In May, the cargo volume totalled 27.8m tons, down just 2.6 per cent year-on-year.
Japan Climate Systems, a joint venture involving Visteon, Mazda Motor and Panasonic, has opened an auto air-conditioning system plant in Nanjing. JCS Nanjing will support the needs of Mazda China and other automakers in China, gasgoo.com reported.
The new manufacturing facility, located in Jiangning ETDZ, will specialise in manufacturing various heat exchanger components for vehicle climate control systems. It has the capacity to produce 800,000 evaporators, 300,000 condensers and 300,000 heater cores a year, both for the Chinese market and for export to Japan and elsewhere in Asia.
The plant will involve an initial investment of US$10m and will employ up to 300 workers.
Environmental advocates have warned that a planned dam on the Yangtze River could lead to the extinction of a number of rare fish species, reported the Wall Street Journal.
The proposed Xiaonanhai Dam would be located 30km upstream of downtown Chongqing, which hopes to use electricity from the dam to meet its growing energy needs. Chinese officials are currently reviewing the project, and critics believe that preliminary approval could be reached soon.
Chinese and foreign scientists are concerned that the dam would encroach on a major rare-fish reserve that is home to 180 different fish species, including the already endangered Chinese sturgeon and the finless porpoise. The upper reaches of the Yangtze have a greater concentration of biodiversity than the middle and lower reaches.
Eight prominent Chinese scientists and environmental activists published an open letter in May urging the government to cancel plans for Xiaonanhai because it would destroy the river’s diverse aquatic life. International environmental groups such as the US-based The Nature Conservancy are also urging reconsideration of the plan.
Heavy storms in most parts of Chongqing claimed eight dead and three missing and caused the displacement of 106,000 local residents, according to the local government.
The central government has already activated National Disaster Response Grade 4 and dispatched a taskforce to co-ordinate rescue efforts. A total of 500 tents, 3,000 duvets and 5,000 square metres of tarpaulin have been dispatched already.
Local rescue teams are monitoring the floods and evacuating people whose life may be threatened by possible landslides.
By 22 June, Nantong Maritime Safety Bureau had recorded the 64th vessel direct from Taiwan and a total Taiwan-related throughput of 350,000 tons since the mainland and Taiwan signed a direct shipping agreement on 15 December 2008. The first vessel from Taiwan arrived in Nantong on 6 February. Before the agreement, vessels from Taiwan had to go via a transhipment centre such as Hong Kong.
The local maritime authorities have already opened a green channel to facilitate speedy passage for vessels coming directly from Taiwan. This includes electronic application for permits, all-weather zero waiting piloting service and targeted promotion of specific regulations among shipping agents and shipping lines involved in Taiwan-related business.
Wuhu Ship Exchange traded 1,046 vessels in 2008, recording a dead weight tonnage of 762,000 tons, third in the national ranking, and a total transaction value of Rmb1.13bn, eighth in the national ranking. According to the Fourth National Ship Exchange conference on Information, Co-operation and Development held recently in Wuhu, the city’s shipbuilding capability and geographic location helped facilitate the rise in its importance for the vessel trading sector.
At its peak in 2004, the transaction value stood at Rmb1.4bn with more than 220 ship brokers operating there. Vessels were traded from across Hubei, Jiangxi, Jiangsu, Zhejiang, Shanghai, Shandong, Henan, Fujian and Guangdong provinces. However, there was a big decline in business levels and in the number of ship brokers over the following two years. In December 2006, the local government put in Rmb200,000 to renovate the building and re-organised the management before trading resumed.
In the shipbuilding sector, the 1,791 largest shipyards recorded a combined total export delivery value of Rmb96.8bn in the first five months of 2009, according to the Ministry of Industry and Information. This was up 25.8 per cent year-on-year, but represented a fall of 38.9 percentage points on the previous year’s growth rate. They achieved a total industrial output of Rmb203.bn, up 38.8 per cent year-on-year, representing a fall of 18.7 percentage points.
Deliveries are on the rise while new orders remain scarce. The ministry’s statistics show that deliveries in the first five months reached 12.16m dwt, up 61 per cent compared with the same period last year, while new build orders plummeted as much as 96 per cent to 1.18m dwt. New orders in May totalled a mere 190,000dwt.
The local government in Jiujiang has approved a major renovation project on the city’s No.214 quay at a cost of Rmb320m. Sources from the city’s reform and development commission said that three multi-purpose 5,000dwt berths will be added to the quay, located in the western suburbs, on a total shoreline of 260 metres.
It is not yet clear when the project will start. Upon completion, the quay will have an annual handling capacity of 1m tons of breakbulk, 300,000 tons of bulk, 200,000 tons of liquid chemicals and 200,000 teu of containers.
Jiujiang Port Authorities have announced a plan to build 18 major berths of 1,000dwt or more, adding an annual handling capacity of 25m tons of cargo by 2012. This is part of the city’s efforts to serve and support the increasing number of industrial investors settling in the city, according to a story published in the local Jiangxi Daily on 23 June.
Currently, 102 berths out of the 116 across the city can accommodate 1,000dwt vessels. Between 2001 and 2008, the average annual throughput of general cargo increased by 22 per cent to 23.15m tons, while the average annual throughput of containers increased from 6,600 teu to 80,900 teu.
In a separate report, Jiujiang reported the start of a recovery in container throughput on the back of strong domestic traffic. The improvement in throughput started in March. In April, it rose again to 7,237 teu before increasing again to 7,885 teu in May, the single largest monthly figure since 2008.
PYI Corporation, the Hong Kong-based bulk cargo port operator, has acquired a 25 per cent interest in Jiangyin Sunan International Container Terminal from Shanghai International Port Group for a sum of Rmb28m.
Jiangyin Sunan operates the container terminal in Jiangyin port. Situated in Jiangsu province, Jiangyin is one of the fastest growing ports on the Yangtze. Its throughput totalled 87.4m tonnes in 2008, representing an increase of 21 per cent year-on-year. Container throughput grew by 64 per cent to 500,000 teu.
PYI said that Jiangyin Sunan intends to consolidate other major terminals in the city with a view to improving services through operational synergy and economies of scale.
Mr Zhu Minyang, Secretary of Jiangyin Municipal Committee of the Chinese Communist Party, said he was confident that service quality levels would improve. “The logistics and manufacturing industries of Jiangyin will become the two wings that take the economy of Jiangyin to the next level,” he said.
PYI already has investments in the Yangtze port cities of Nantong and Yichang as well as Hubei Minsheng LPG Terminal.
Guangzhou-based property developer Evergrande Real Estate has decided to invest Rmb10bn in a mixed use development project in Wuhan, Hubei province. Situated in the city’s Qiaokou district, the 76-hectare project will include residential properties, hotels and an exhibition centre.
Evergrande is currently working on four other projects in Wuhan, all residential developments, according to the report in the Chinese website Guandian.cn.
China’s industrial output climbed 8.9 per cent year-on-year in May, 1.6 percentage points higher than in April, according to the National Bureau of Statistics (NBS).
Among the big sector gainers were chemical products, whose output increased 11.1 per cent, and transportation equipment, which climbed 12.8 per cent. Cement output stood at 148m tons in May, a monthly record. In the first five months of this year, cement production grew 13.3 per cent year-on-year to 570m tons.
Coal output increased 9.6 per cent on May 2008 to 250m tons, while crude oil output fell 1.1 per cent to 160.3m tons. Rolled steel output was down 7.4 per cent to 573m tons.
Much of the increases can be attributed to China’s Rmb4,000bn stimulus package announced last November. Reflecting the continuous rolling-out of this campaign, China’s urban fixed asset investment surged 33 per cent from a year earlier to Rmb5,350bn in the first five months of this year, according to the NBS. The increase was 2.4 percentage points higher than that of the first four months of 2009.
Luxembourg-based logistics company Logwin has opened a new customer office in Zhangjiagang, Jiangsu province. It will be used to develop existing logistics projects and expand its services for international customers.
Zhangjiagang is a newly developed city on the southern bank of the Yangtze River, some 170km northwest of Shanghai. It is home to many companies in the metallurgy, electronics, chemicals and textiles industries.
With a presence in more than 20 Chinese cities, Logwin also has operations in the Yangtze River delta cities of Shanghai, Suzhou, Wuxi and Nanjing.
PetroChina, China’s largest oil producer, has received approval from the Ministry of Commerce for its proposed Rmb6.6bn investment to build a liquefied natural gas (LNG) terminal in Jiangsu province, Shanghai Securities News reported.
The project, a joint venture involving PetroChina, Hong Kong-based Pacific Oil & Gas and Jiangsu Guoxin Investment Group, is expected to begin by the end of April 2011. It will be situated on West Taiyangsha artificial island off the coast of Jiangsu.
The terminal will import LNG from Qatar, Australia and the Chinese city of Dalian, and is expected to produce 3.5m tons of natural gas a year, eventually rising to 6.5m tons annually.
In a separate development, PetroChina was reported to be seeking a partner to offer crude oil for a proposed Rmb15bn refinery in a chemical industrial park in Chongqing’s Changshou district.
Wang Yilin, vice general manager of PetroChina's parent, China National Petroleum Corporation, said that the new refinery would produce 6.5m tons of refined oil a year. It was not made clear when the refinery will open.
China’s oil producers are building more LNG plants as the country tries to reduce emissions by increasing gas consumption to 9 per cent of total energy use from the current 3 per cent. Most of the large refineries are located in northeast and northwest areas, so the Chongqing facility will help ease the supply shortage in the southwest area.
China Shipbuilding Industry Corporation is to build a ship industry town in Wanzhou, a city of some 1.7m people situated halfway between Chongqing and Yichang.
The town will focus on the production of key ship components such as thrusters and wind power equipment.
Occupying an area of some 13 hectares and involving an investment of Rmb600m, phase one construction will start this year and should be completed by the end of 2010. More than 1,000 jobs will be created, according to local media.
Sandoz, the Germany-based pharmaceutical company, is to set up its Chinese headquarters in Chongqing and merge with Chongqing Lummy Pharmaceutical, according to a municipal government website. The company will also establish a research and development centre in the city.
Earlier this year, another major global pharmaceutical company Eli Lily said it plans to increase its investment in Chongqing.
Chongqing will start constructing five new expressways in 2009, according to the municipal government. The new roads are: the Fuling-Fengdu-Shizhu Expressway, with a total length about 100km; the 200km Fengjie-Wuxi Expressway; the 55km Fuling-Nanchuan Expressway; the 30km Wansheng-Nanchuan Expressway; and an expressway between the city proper and Fuling.
Chongqing’s total expressway length will stand at nearly 2,000km by the end of 2010, rising to 2,100km in 2012.
Chongqing government has announced its detailed subsidy policies to encourage farmers to buy new cars and motorbikes. ‘Old for new’ subsidies will be provided up to a maximum of Rmb5,000 or 10 per cent of the sales price. Subsidies for purchasing cars will stay in force until the end of this year, while those for motorbikes will last until 31 January 2013.
The local government will be responsible for funding 20 per cent of the subsidy scheme, with the central government providing for the remaining 80 per cent. This is part of a national effort to help the car industry by boosting domestic demand. The national association of auto manufacturers reported total car sales of 1.15m in April, up 25 per cent over the same month last year.
Transport police on the Shanghai-Nanjing Expressway flagged down a passing sleeper coach at 6:30pm on 15 June only to find 148 passengers on a coach with a capacity of 39.
The deluxe sleeper coach belonged to a transport company in Anhui province. According to the driver, the passengers were all farmers heading back to their jobs in Shanghai after helping out with the harvest at home.
The police arranged for three coaches to take the immigrant workers to Shanghai. The driver was fined Rmb2,000 and 12 points were added to his licence. The coach was confiscated and the owner was handed a Rmb20,000 bill for transferring the passengers.
According to Hubei province’s Reform and Development Commission, the first north-south rail line dedicated to transporting coal is inviting bidding; construction work is expected to start at the end of the year.
The 800km line starts at Yingcheng in Shanxi province, passes through Shaanxi and Henan before entering Shiye and Yichang in Hubei province and finally ending up in Shimeng in Hunan province. The project is estimated to cost well over Rmb100bn, as more than 90 per cent of the line will be laid over bridges or in tunnels.
Half of the line will pass Hubei and provincial officials say that the line will bring much-needed coal from Shanxi, Gansu and Xinjiang to its booming industries. It will also allow Hubei to distribute its agricultural products and mineral resources to other provinces.
From 17 June, Jiangsu Maritime Safety Bureau will start registering all its 179 terminals that handle dangerous goods in an effort to check their safety and emergency precautions. The terminals combined handle 270 types of dangerous goods, with a total storage capacity of nearly 10m cubic metres of liquid chemicals.
Last year, 400-500 chemical vessels operated in the Jiangsu stretch of the Yangtze on a daily basis, carrying a total average cargo of 300,000 tons.
The water level of the reservoir at the Three Gorges dam fell to 145.84 metres at 2pm on 9 June, according to the China Three Gorges Dam Corporation, signalling the end of the water release process and its readiness for the flood season.
The primary function of the dam is flood prevention. The reservoir has a total storage capacity of 39.3bn cubic metres of water and the level can rise to a maximum of 175 metres during the flood season.
Starting in November, the reservoir will release water to relieve the usual drought conditions in the middle and lower reaches of the Yangtze. The water level drops to 165 metres by late 28 February, to 155 metres by late May and to 145 metres by around 10 June.
As a result of the current reduced water level, the five-step shiplocks have been reduced to four steps, resulting in a saving of 90 minutes for passing vessels, according to officials from the Three Gorges Administration of Navigation. This situation will last until October.
Chongqing Port Authority announced recently that it would speed up the modernisation of the waterway network in the upper reaches of the Yangtze by investing an additional Rmb24.5bn over the next three years, reported Chongqing Daily. By 2012, the municipality will be connected by the waterway to Sichuan, Guiyang, Yunnan, southern Shanxi, eastern Tibet, southern Gansu and western Hubei. In the first five months of this year, the city invested Rmb1.15bn in the Yangtze.
The additional investment will be spent on 10 dredging projects and 21 terminal projects. Efforts will also be made to develop 3,000-5,000 dwt vessels suitable for shipping conditions on the upper reaches of the Yangtze. By 2012, the city will increase its general cargo handling capacity from the current 110m tons to 150m tons and for containers from 960,000 teu to 5m teu.
The responsibility of developing the Yangtze ports and tributaries was transferred to local governments after a decentralisation and reform programme was carried out in the early years of this decade. The central government is now only responsible for developing and maintaining the Yangtze trunkline.
Wuhan’s vice mayor Yue Yong was quoted in the local media on 16 June as saying that construction of a major chemicals terminal would start in the second half of this year at the chemical industrial zone in the east of the city.
The first phase is scheduled to be ready for operation by the end of 2010. Upon completion, the terminal will be capable of handling an annual throughput of 3.2m tons of solid and liquid chemicals.
The new Beihu terminal will have a shoreline of 1,200 metres, and will cover 33 hectares. It will have six berths, including an area for liquid chemicals storage tanks. Singapore-incorporated Hengyang Petrochemical Logistics was reported as saying that it plans to invest Rmb1bn in the project.
UK-based investment firm Ecofin has launched a China power and infrastructure fund to invest in equities of major companies.
The company said the fund would benefit from the Chinese government’s massive upgrade of the country’s infrastructure, particularly of the transportation network, renewable energy, and utility generation and distribution.
Cargo throughput in May at China’s leading ports rose 5 per cent from a year earlier to 546m tons, said the Ministry of Transport. This was the third consecutive month of growth, reflecting an increase in demand for the domestic transportation of bulk commodities.
Foreign cargo throughput increased 4.7 per cent year-on-year to 182m tons in May, while domestic cargo throughput was up 5.1 per cent to 364m tons.
Container throughput was expected to total 9.75m teu in May, down 9.7 per cent year-on-year or a fall of 4 per cent on the previous month. The country’s largest port, Shanghai, handled 2.07m teu and saw an increase of 3 per cent in average daily volumes.
Once again, southern ports recorded the steepest falls, being more dependent on overseas demand for consumer goods. Shenzhen Port handled 1.47m teu in May, a year-on-year decline of 16 per cent.
Wuhu-based Chery Automobile, China’s largest automaker, has raised Rmb2.9bn from Chinese private investors to fund its development and expansion plans. Much of the money will be used in its clean energy programme and a planned new sedan plant, said company spokesman Jin Yibo.
The Wall Street Journal reported that Chery raised the capital by selling a 20 per cent stake to the investors, though Chery refused to confirm the amount transferred.
Chery aims to rank among the world’s top 10 automakers, and the current industry slowdown provides it with a good opportunity to boost development by raising capital, added Jin.
In December 2008, Chery signed an agreement with Export-Import Bank of China for loans totalling Rmb10bn to be used for overseas expansion.
The company sold 42,935 cars in April, a monthly record, accounting for 11.45 per cent of the total local brand passenger cars sold in China. It aims to sell 419,000 vehicles in 2009, up from 356,000 units last year.
The auto maker is well known for its cheap subcompact models. However, this year it has started to branch out into the higher-end sedan market with a new model called the Riich.
Low-cost airline AirAsia plans to continue its China expansion in 2009 by flying to two new destinations. In the second half of the year, the Malaysia-based carrier will start services to Chengdu and Xian from Kuala Lumpur. By the end of the year it will also launch flights from Thailand to Shenzhen, Guangzhou and Hangzhou, cities that the airline already serves from Kuala Lumpur.
Originally focused on budget tourists, AirAsia has enjoyed growing success in the corporate travel market in the current economic downturn, as large companies cut travel spending and shift their custom to low-cost services.
Air China will increase the frequency of its Chongqing and Taiwan service to three flights a week from August 2009 and it is expected to become a daily service by the end of the year. Occupancy levels on the route were running at 74 per cent between the start of the service in December 2008 and 24 May 2009, according to a Chongqing government website.
This is part of an overall increase in Air China’s planned services to Taiwan following last month’s expanded air service agreement between the PRC and Taiwan to more than double the number of flights to 270 a week from 108 in an effort to promote cross-strait ties. Air China's managing director, Lou Yongfeng, said that high load factors and relatively high ticket prices have made these routes profitable for the airline.
China Eastern Airlines and Taiwan’s China Airlines have been operating a freighter service between Shanghai and Taipei since last December.
The giant retailer Wal-Mart plans to invest a total of US$16.9m in the five stores it will open in Chongqing this year, according to a company executive quoted by Chongqing Daily. One of the stores has already opened and the five in total will have a combined floor area of more than 10,000 sq metres.
Official statistics show that total retail sales in Chongqing during the first five months of the year rose by 18.4 per cent to Rmb231bn. In May alone, sales increased 20.9 per cent year-on-year to Rmb50bn, a monthly record, thanks to the May Day holiday and the newly-created Duanwu holiday.
Jiangsu Shagang Group is weighing up an acquisition of Zhangjiagang Wanda Steel Plate, according to China Business News. Jiangsu Shagang, China’s largest private steel maker and the fifth largest steel producer in the country, does not produce galvanised sheet and cold rolled products, two areas where Wanda has a significant presence.
With an annual output capacity of 28m tonnes, Shagang has been on the acquisitive trail for some time. Earlier in 2009, for example, it announced that it would acquire Shanxi private mill Meijin Steel.
Dow Chemical’s new facility in Zhangjiagang, Jiangsu province, has completed trial operations and started production of commercial-grade glycol ethers. The facility has an annual capacity of 120,000 tonnes and its output will be used by electronics manufacturers in China, Korea and Japan, as well as in the formulation of paints and coatings and cleaning products.
Zhangjiagang, a Yangtze port city located some 200km upstream of Shanghai, is a strategic site for Dow. The company has three other major facilities there: a converted epoxy resin plant, a styrene butadiene latex facility and a joint venture polystyrene resin plant.
Nantong quarantine inspectors targeted the numerous empty containers stacked in Nantong’s container yards recently, according to an article in China News Service published on 10 June, and issued a grave warning that poor hygiene levels might exacerbate the problem of falling exports. According to the inspectors, few of the empty boxes are genuinely empty. They took samples from 20 randomly-selected containers and found various infestations in 11 of them. In addition to items of daily household waste such as sweet wrappers and rags, some contained wood packaging not stamped with the International Plant Protection Convention logo, the international standard for wood packaging. Many countries, including China, ban such substances from entering their ports, the inspectors said, and without a thorough clean-up, overseas-bound Chinese-made goods could risk return at entry, thereby exacerbating the depressed state of the export market.
The inspectors advised shippers, shipping lines and freight forwarders to inspect empty boxes before taking them to the yard. They also reminded the terminals to follow established procedures in the cleaning up process.
According to sources from Tongling Customs, 36 international vessels entered the city’s port in May, a record monthly total since Customs clearance was set up 12 years ago. The establishment of a recycling industrial zone in the city has increased demand for imported waste metals; one-third of vessels anchoring at Tongling in May were carrying imported waste metal.
Exports of local limestone have also picked up after demand fell away late last year as a consequence of the worldwide economic downturn. The addition of two 5,000 dwt berths in the foreign trade terminal at the end of 2008 prepared for the influx of international vessels to the city.
One of the five major ports in Anhui province in the lower reaches of the Yangtze, Tongling is famous for its copper industry. Tongling Nonferrous Metal Group is China’s largest producer of electrolytic copper.
The southern shiplocks at the Three Gorges Dam were shut down for a total of 58 hours between 8 and 10 June for maintenance repair, according to the Yangtze Three Gorges Navigation Administration. Vessels travelling in both directions had to use the northern shiplocks, which caused considerable delays.
It was not made clear how frequent such maintenance is needed or how much advance notice the authorities gave shipping lines.
At 8:30pm on 5 June, hurricane-force winds on the lower reaches of the Yangtze between Wuhu, Anqing and Jiujiang, caused 12 vessels to capsize and 47 crew members to fall into the river. By the following day, 42 people had been rescued, one was pronounced dead and four missing. Thirty-five vessels and more than 280 people were involved in the rescue operation, which took place in atrocious weather conditions. Efforts are still underway to find the missing people.
The latest reports from the Yangtze River Administration revealed that none of the vessels was carrying dangerous goods and their positions were being closely monitored and publicised to warn passing vessels. Maritime safety authorities are urgently repairing signs and buoys damaged by the winds. They are also planning to recover the sunken vessels.
Wuhan Iron and Steel, China’s third largest iron and steel producer, recently confirmed its plan to invest several hundred million Renminbi in seven ports across the country to facilitate the transportation of its raw materials and finished goods via waterways. The ports include Ezhou and Wuhan’s Yangluo terminal, both in Hubei province, Taicang in Jiangsu province, Zheshan in Zhejiang province and Fangchenggang in Guangxi Zhuang autonomous region.
With an annual steel output of 50m tons, the company said that its transport costs could be reduced by Rmb20 per ton. This would equate to a saving of Rmb370m for the 18.45m tons of iron ore it imported in 2008.
China’s first national level medical high-tech industrial development zone was established in Taizhou, Jiangsu province, on 29 May.
This zone will specialise in the manufacture of five product categories: vaccines, new agents of chemical compound medicines, biomedicine, Chinese medicine and high-end medical equipment.
So far, the zone has attracted more than 40 medical research and development institutes including Hamuna Research Institute, Texas Medical Center from the US and China Pharmaceutical University. More than 100 pharmaceutical production and service enterprises have set up in the zone.
The Italian chemicals company Polynt has opened a new production line at its facility in Changzhou, Jiangsu province.
Situated in Xinbei Industrial Park, the plant was built in 2004 and acquired by Polynt in 2007. It makes trimellitic anhydride, special plasticizers and special anhydrides. These chemicals are used for making electronic equipment, electrical cable coating, packaging and medical equipment.
Polynt Chemical (Changzhou) has 145 employees and a registered capital of US$56m. It has a production capacity of more than 70,000 tons a year.
Tongling Nonferrous Metals Group, China’s largest copper smelter, plans to raise production by 23 per cent in 2009 to 800,000 tonnes, according to analyst Yang Changhua at state-owned metals consultancy Antaike.
At the start of this year, a Tongling official told Dow Jones that the smelter planned to cut its 2009 output. The apparent change in policy indicates that Tongling believes relatively tight domestic copper cathode supplies will sustain prices, despite weak demand.
Tongling is a Yangtze port city in Anhui province, situated about 80km west of Wuhu.
The Shuijiang-Wulong section of Chongqing-Hunan Expressway will open to traffic in October 2009, according to a Chongqing government website. As a result, the driving time between Wulong county and downtown Chongqing will be shortened from three hours to one-and-a-half hours.
Construction work begun on 2 June of the first phase of Chongqing Lianglu Cuntan Bonded Port Zone.
The 2.1 sq km first phase of China’s first inland bonded port zone will open in December, with all three phases due to be completed in 2015. The entire project will cover 8.4 sq km and is situated close near Chongqing Jiangbei International Airport and Cuntan Terminal. It will involve a total investment of some Rmb10bn.
Chinese goods entering the zone are treated as exports while foreign goods entering the zone are treated only as imports upon leaving the zone.
Jiangyin port imported 841,000 tonnes of steel in the first quarter of 2009, an increase of more than eight fold over the same period last year, according to the city’s Customs office. The volume of steel billet increased 318 per cent to 495,000 tonnes, while imported scrap rose from almost nothing to 170,000 tonnes.
Jiangyin is becoming an important steel billet distribution centre situated on the lower reaches of the Yangtze River. Most of the demand for steel billet, according to Jiangyin Daily, comes from foreign trade companies based in Jiangsu, Shanghai, Zhejiang and Beijing.
Maanshan Iron & Steel, China’s second-largest steelmaker, has recorded significant growth in its auto steel plate sales in recent months, according to sources reported by China Knowledge. In May, the company received orders for 45,000 tons of auto steel plate products, twice the amount ordered in the latter months of 2008.
The company attributed the improvement to the relative buoyancy of the auto manufacturing industry along with successful R&D and sales activities. Its deliveries in May included 1,500 tons of outer steel plates to Anhui Jianghuai Automobile and Changan Automobile.
Sinochem’s new 50,000 tons polyether polyols facility in Taicang, Jiangsu province, started trial operation in late May. It was due to go into proper operation a week later.
The company has invested Rmb100m in the plant and most of the raw materials will be sourced from surrounding areas.
Polyether polyols are a key component used in the production of polyurethanes.
Sinopec has started building an 18,000 barrels-a-day hydrofining unit at its Jiujiang plant in Jiangxi province to improve petrol quality. The project, costing around Rmb167m, will be completed in January 2010, according to the company.
The facility will reduce sulphur content in petrol to 0.015 per cent from 0.05 per cent. This is in line with national measures to address China’s worsening pollution caused in part by the soaring number of vehicles. China plans to move to the third phase of emission standards nationwide — similar to Europe’s Euro III standards — starting in 2009 for petrol and 2010 for diesel.
Sinopec completed an expansion at Jiujiang in 2008, which increased its crude processing capacity by 30 per cent to 6.5m tonnes a year, or 130,000 barrels per day.
Logistics services provider Schenker China has obtained a business licence to establish a new branch in Wuhan, Hubei province.
Heavy industry is a pillar of the local economy, led by iron and steel. Other important sectors include high-technology, automobiles, electronics, optical equipment and textiles. The branch will focus on transportation and logistics services related to these key industries.
According to the transport authorities in Hubei province, the Yichang-Wuhan Expressway has been renamed Shanghai-Chongqing Expressway as of 1 June. This is part of a nationwide campaign to standardise names, signs and codes on the national network.
The 2,500km Shanghai-Chongqing Expressway, of which the Yichang-Wuhan section is a part, will be coded as G50 on the national network. The Shanghai-Chongqing Expressway, also known as the Riverside Expressway, will pass through Nanjing, Hefei, Wuhan, Yichang and Wanzhou before reaching Chongqing. While most of the line has already been built, the 560km section between Yichang and Wanzhou is a bottleneck with poor quality road conditions. The entire project is scheduled to be completed by end of 2010.
A Panama-registered vessel entered Nantong from South Korea on 28 May and was spot fined Rmb1,000 for not displaying three red lights at night while waiting for quarantine inspectors.
According to Chinese regulations on hygiene and quarantine, vessels must display appropriate signals to show that they are waiting for inspection so that passing vessels are warned to keep their distance and crew members know not to disembark before inspection is completed. Over the previous seven days, the vessel in question had visited an area reported to have detected the H1N1 virus, otherwise known as swine flu.
This is the third time Nantong authorities have fined vessels for such a violation.
The number of residential properties sold in Nanjing totalled 8,486 units in May, equivalent to 949,000 sq metres, according the Nanjing Real Estate Bureau. Both totals were about 10 per cent lower than the previous month. In April, 9,755 units were sold, totalling 1.03m sq metres.
Analysts believe that the recent price rises imposed by some major developers have backfired. But officials argued that the fact that nearly 280 properties are sold each day in Nanjing shows that there is still demand from ordinary residents.
The situation in the central Chinese city of Wuhan was more buoyant. Property transaction volume in the Hubei capital hit 8,107 units in May, 980 units more than in the previous month. Average daily property transaction volume was 261 units, according to a local real estate researcher quoted by China Knowledge. This represented a month-on-month increase of 13.75 per cent or a year-on-year increase of 77.75 per cent.
The major Yangtze ports reported a total cargo throughput of 90m tons in May, the same level as last May, according to figures released by the Yangtze River Administration. For the first five months, throughput of general cargo totalled 411m tons, again no change year-on-year. Foreign trade-related throughput went up by 10.2 per cent to 56m tons during the first five months, largely driven by increased imports of iron ore in the lower reaches. Container throughput fell by 15.6 per cent to 2.31m teu in the same period.
Statistics from the Yangtze Maritime Safety Bureau showed a total of 15 major accidents in the river during the first five months of 2009, causing nine deaths, 10 sunken vessels and a direct financial loss of Rmb7.1m.
In a separate report, the Yangtze container index increased by 4.46 per cent to 942.90 in May, largely driven by greater import activity in the upper reaches. Manufacturing companies operating in the interior have been taking advantage of low raw material prices in the international market by importing aggressively from overseas. Container barges on the Shanghai-Chongqing route are operating at full capacity, although vessel numbers have been reduced by the withdrawal from service of several barges following the onset of the economic downturn; not all these barges have since resumed service. This development has driven up the container index by 10.6 per cent for the upper reaches to 982.35 while the middle reaches fell by 0.32 per cent to 896.36 and the lower reaches by 0.62 per cent to 921.71.
By contrast, the Yangtze dry index changed little in May, posting a slight increase of 0.26 per cent to 805.88. The shipping index for coal fell by 0.96 per cent to 649.61 due to depressed demand from across the Yangtze. The iron ore index increased by 2.1 per cent over the previous month to 850.42, reflecting heightened import activities in the low reaches. The shipping index for building materials continued to rise in May, by 1.68 per cent to 1,270.72, due to the on-going Sichuan earthquake relief efforts and numerous infrastructure projects in the interior region. The non-metal ore index fell 6.45 per cent to 896.68.
Shanghai International Maritime Arbitration Centre was set up on 25 May as part of on-going efforts to build Shanghai into an international shipping centre. The centre is located in north of the Bund area in Puxi district and will be manned by scholars, regulators, lawyers and retired maritime judges.
Wuhan Port Authority has urged privately-owned terminals to be opened up to outside users. Fourteen out of the 16 planned terminal projects included in the blueprint of Wuhan New Harbour will be built by companies and the city’s port authorities hope that these private owners will open their terminals to common use so as to better utilise the shoreline.
Historically, major Chinese manufacturing companies were allowed to build terminals for their own use. However, Wuhan’s rapid industrialisation over the past decade means that the shoreline available for building common-user terminals has become scarcer.
According to Mr Chen Haihong, director of Wuhan Port Authority’s terminals division, the government is committed to helping companies obtain loans for terminal building projects, but urges that they are operated like common-user terminals. One company, for example, has built a terminal that can accommodate 5,000 dwt vessels, but its own fleet are all 3,000 dwt vessels.
“This is a waste of non-renewable resources such as our shorelines,” he was quoted as saying.
In Jingzhou, another major Yangtze port city in Hubei, the port authorities have ruled out the possibility of approving future privately-owned terminals on the principle that shorelines are non-renewable state assets that require special care.
Jiangsu government launched a month-long promotional campaign on 1 June to increase awareness of a government-backed insurance scheme to cover the costs of river pollution and clean-up before it comes into full operation in July. It is now compulsory for vessels carrying oil and chemicals in the province to take out policies that cover against clean-up of pollution caused by collision or leakage. The scheme will eventually be extended to all types of vessel in the waters of Jiangsu, the busiest stretch of the Yangtze.
The policy, initiated by the Jiangsu Marine Safety Bureau, Jiangsu Environment Protection Bureau and two other government bodies and issued by four major Chinese insurance companies, will be opened to vessels below 1,000 dwt, which are not normally covered by insurance policies. Trials began last November and 1,200 vessels signed up within a month.
Government officials hope that the scheme will increase public awareness of responsibilities towards the river, bring in financial resources to clean up pollution and improve the emergency response mechanism.
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