FRACHT NEWS

Dear members of the Fracht family
We would like to inform you about some changes at the Fracht Houston office.

First of we are pleased to announce our new office location. Effective April 25, 2008, we are relocating to

16800 Greenspoint Park Drive, Suite 100
Houston, TX 77060

Our email addresses, phone and fax numbers will remain the same. We do not expect any problems with the move but in case there are communication problems, please use our cell phone numbers to reach us. 

In addition, on (5/26/08), Benjamin Liewald and Sven Braun will be relocating from our Kennesaw, Ga. office to join the Houston staff. They will be in the Projects Division and report to Arie Hoek, our Senior Project Manager for the newly formed Project division in Houston. We would also like to welcome Ms. Stacy Vasquez to the Fracht Family. She will complete our project team, and has assumed the responsibilities of Stephanie Mimbela, who recently left the company. We decided late last year to unite the Houston and Kennesaw offices and started to combine our efforts in January. The success up to this point has been enormous and I would like to say a special thank you to our two youngsters and their mentor Arie Hoek.

Over the recent years we have formed a great Houston team here to assist you with all your project needs in the USA, Canada and Mexico. 

Please do not hesitate to contact the undersigned if you have any questions.

Best regards,

Reiner Wiederkehr

Dear Friends we have great pleasure to inform you an important step for Fracht Family, that our office in Rio de Janeiro is open, located in Traditional Business Center in Rio de Janeiro at Rio Branco Avenue, near Alstom (our tradition customer) and Queiroz Galvao Construction (first customer of this office), in front of the Petrobras Building.

Our manager is Mr. Pierre Villenave that have a large experience in Ocean e Air shipments and great relationship in the International Market.

Our target will be sales our service for the Oil & Gas companies, Shipyards Constructions, Power Companies, Naval and Ship Suppliers.

All operation is controlled by Fracht Sao Paulo

Below the full address:
Av. Rio Branco n. 181 – 10. Andar sala 1003 – Centro.
Telephone 021-2531-2035
Telephone and fax 021-2283-5038
Comercial Manager Mr. Pierre Villenave – email: Pierre.villenave@fracht.com.br
Mobile 021-7815-9681
Nextel ID 55*15*28330
Recepção email fracht.rio@fracht.com.br

Please may you send your welcome to Fracht Family to Mr. Pierre Villenave.

Cesar Pereira
Project Director
FRACHT DO BRASIL LTDA
Phone: 55-11-3868-9301
Fax: 55-11-3875-4344
Mobile 55-11-9418-9200

E-mail: cesar.pereira@fracht.com.br
Skype: cesar pereira - fracht sao
MSN: cesarpebr@hotmail.com
Web Site: www.fracht.com.br

"FRACHT MEANS FREIGHT & CUSTOMER CARE"

We have the great pleasure to inform you about the opening of our own branch in Taipei City (Taiwan) under following address:

Fracht FWO Logistics Co., Ltd.
12F, No. 273, SEC. 4, Hsin Yi Road,
Taipei City 106
Taiwan, R.O.C.
Tel:  +886 2 2704 0717 / +886 2 2704 0239
Fax: +886 2 2704 7467

Mr. David Wei (Managing Director)
E-Mail: david.wei@fracht.com.tw

Shanghai Pudong International Airport opened its new Terminal 2, with an 40 million passenger handling capacity that is expected to help reduce delays. The wave-shaped terminal, 546,000 sq.m. in area and split over three levels, doubles both the size and handling capacity of the old terminal. Built under Shanghai Airport Authority's USD2.8bn expansion plan, the new terminal is expecting an estimated 15 million passengers for the World Expo in 2010

The German shipping company Hamburg Süd and Maersk Line (Denmark) have signed a new vessel sharing agreement. Once the cartel authorities give the green light, the two lines will launch a joint weekly service between Australia/New Zealand and the North American east coast around the end of May. Twelve 2,800 teu vessels, offering a total of 530 reefer plugs, will be deployed on the loop. Each partner will contribute six ships. The new service will replace parts of Hamburg Süd's existing Trident loop between Australia/New Zealand and the North American east coast, and Maersk Line's Oceania service to the east coast of the USA.

Dear Customer,
We would like to inform you that the temporary acceptance regarding the weight limitation of 20’ft Containers on biaxial chassis granted by Japanese authorities for truck transports will expire from 31st March 2008. In the past it was allowed to accept a Gross Weight (GW) up to 24,000kgs for 20’ft Containers on biaxial chassis.

As previously advised, a new IATA Resolution (600B) will come into effect on March 18th, 2008, which will result in changes to the conditions of the reverse side of the air waybill.

Prior to that date only the old ones are valid - afterwards only the new ones. 

New tariffs will come into force in Russia on 9 February, according to the December order "On setting the exceptional rates for carload transportation via the Russian railways, as well as the delivery of own (leased) empty railcars from the Lokot, Neverovskaya, Masalskaya, Removskaya, Tretyakovo stations of Kazakhstan Railways, located in the Altai Territory of the Russian Federation, with the point of destination stations of Russian Railways RZD, located in Russia". (Dars)

- http://www.rzd.ru

Maersk Line is pleased to introduce a new formula for our floating BAF (Bunker Adjustment Factor).
Our aim with the new formula is to provide a simple, fair, and transparent BAF for our customers. In addition, allowing us to share and recover the extraordinary costs provided by the increasing bunker prices.

Bunker prices have tripled within the last three years and bunker costs now constitute nearly half of the total vessel costs, up from 20% ten years ago.

“Today, we only recover approximately 55% of the bunker expenses via BAF surcharges. Naturally, this poses a significant exposure to Maersk Line, and traditionally we have tried to recover this via rate increases,” says Vincent Clerc, Vice President for Pacific Services.

“With Maersk Line’s BAF formula we will create more transparency, and our customers will experience a simple and fair way of applying BAF. Amongst our customers, we see an increased understanding and acceptance of BAF as a floating mechanism, and our customers increasingly accept that we must share the extraordinary costs in a just way.”

The BAF formula
We have built the BAF formula on principles that are common in other transportation industries like airlines and parcel services. In these industries, prices and rates reflect fluctuations in fuel prices, and customers accept this as part of doing business in an industry, which is very reliant on fuel.

The formula builds on elements such as fuel consumption, transit time, and imbalances of container flows. However, only changes in the oil price will entail changes in the BAF level. Our customers will therefore only pay the variation in cost, and although the BAF rises when fuel prices climb, they will also benefit from downward trends as the bunker price fluctuates.

Our various trades will implement the new Maersk Line BAF formula separately, beginning the first quarter of 2008. All trades will make announcements on maerskline.com/baf when they transition to the new BAF formula. We expect to complete the rollout by 1 January 2009.

The BAF Calculator
To support our new BAF formula, we have developed the Maersk Line BAF Calculator, which is accessible via maerskline.com.

With this web tool, our customers and other interested parties can calculate their BAF based on trade and make simulations based on fluctuations in bunker prices. In addition, the BAF Calculator has information on the variables behind our BAF formula, an extensive Q&A, and news on upcoming BAF changes.

Chinese New Year is fast approaching and this requires proper planning for shipments to and from China, especially TO China. The timing of shipment arrivals is especially critical.

Chinese New Year is from February 6-12 inclusive. Most offices, as the country in general, will be closed for business during this time. Please also note that typically during the few days before the official holidays, customs and all government facilities are typically a little slower than normal on processing of documents and clearances. Please also note that after the holidays, documentation, permits, and clearances take a little longer than normal due to the backlog of arrivals.

We highly recommend that all shipments to China arrive ON OR BEFORE January 30th 2008 to ensure a timely clearance and delivery prior to the holidays. 

In case of emergency please do contact following no: + 86 13501721466 (however please do consider the time differences).

China and the US agreed last week on a doubling of passenger flights and an effective 'open skies' policy for cargo services between their two countries, in what is seen as an important step-forward for airline market into China.

The two countries agreed to abolish all restrictions on cargo services by 2011, with a partial lifting of restrictions by 2009. The two sides state that "the agreement …will provide U.S. cargo carriers with virtually unfettered access to Chinese markets by lifting all government-set limits on the number of cargo flights and cargo carriers serving the two countries by 2011. "

At present access to passenger routes by non-Chinese carriers is limited, with only 10 flights a day by US airlines flying from the US. This is set to grow to 23 flights a day by 2012.

The agreement was part of the 'Strategic Economic Dialogue' (SED), which is an on-going process of trade negotiations between the two countries.

In passenger services progress will be slow with just one flight being added a year to either Beijing, Shanghai or Guangzhou. One new US airline may also add China to its services.

However present market trends suggest that the market for cargo services is already well supplied. The Association of Asia Pacific Airlines, which includes many of the big players in the China cargo sector such as Cathay Pacific, has reported a fall in utilisation rates, with demand in April 2007 increasing by 0.7% but capacity increasing by 3.3%, leading a fall in 'load factor' of 1.7% to 66%.

With all of the main Express companies, amongst others, having major expansion plans already in place, it might be suggested that the SED agreement only confirms the existing trends for the cargo market.

Korean Air Cargo has started regular freighter services to Chengdu, China by adjusting the schedule of its existing Incheon-Delhi-Brussels-Incheon route. In addition to Incheon-Chengdu route, Korean Air Cargo will provide air cargo service on Chengdu~ Delhi route and Chengdu-Brussels route directly.

Chengdu, located in southwest China, is the capital of the Sichuan province and a sub-provincial city. Chengdu is also one of the most important economic centres as well as transportation hubs. Chengdu is home to several key industries in and Chengdu 's Hi-tech Industrial Development Zone has attracted a variety of multinationals.

In 2000, government adopted China Western Development which is a policy to boost its underdeveloped western regions. As a result, trade volume from Chengdu has been increased more than 30% annually. The main export/import items are IT, textiles, raw materials and equipments.

China Southern Airlines has launched the first air service between The People's Republic of China and Africa.

"Nigeria is playing an increasingly important role in the international community," said Mr. Liu Shaoyong, Chairman, China Southern Airlines. Mr. Liu made his comments at the welcoming ceremony today at Lagos' Murtala Mohammed International Airport.

Mr. Liu added that, "China's second largest trading partner and exporting country in Africa, Nigeria is of great importance to China. The Beijing-Dubai-Lagos route launched today is the first ever air service to Africa launched by China Southern. It is also the only China-Africa air service available in the Chinese civil aviation industry and it will surely open up a new gateway of communication and cooperation between China and Nigeria."

Bilateral trade between China and Africa has an average growth rate of 23.6%. Nigeria has become one of China's important trading partners in Africa.

Cathay Pacific Airways has announced a further expansion of its freighter service to and from Shanghai. From 2 December 2006 the airline will add five more flights a week - operating every Tuesday, Wednesday, Thursday, Saturday and Sunday - taking the total to 17 flights each week. One further flight will be added on Fridays with effect from 5 January 2007. The additional flights will be operated using Boeing 747 Freighters.

The Shanghai freighter service was launched in January 2005 with a daily flight. Five flights a week were added later to carry mainly DHL express consignments using A300-600F Freighters. The latest increase in frequencies is due to continued high demand out of China's major commercial city and will help Cathay Pacific feed more freight into its growing international network. It will also significantly enhance Hong Kong's role as Asia's leading air cargo hub and gateway to the Chinese Mainland.

Cathay Pacific Director & General Manager Cargo Ron Mathison said: "We are delighted to be boosting Hong Kong's freight-hub role by adding more flights to and from Shanghai. The route has performed well since its launch and the extra flights will enable us to get further leverage on the Eastern China market as demand remains high."

The expanded Shanghai service comes on top of the recent announcement of a new Cathay Pacific freighter service to Beijing. The twice-weekly service to China's capital launches this Wednesday, 15 November, allowing the airline to capture a share of the important Northern China cargo market.

Cathay Pacific has significantly expanded its freighter network over the past 12 months. Dallas and Atlanta were added in late 2005, while Chennai, Toronto and Stockholm became online destinations earlier this year. The airline will expand its freighter fleet with the addition of three more Boeing 747-400BCF "Boeing Converted Freighters" in 2007 and the first of six new Boeing 747-400ERF "Extended Range Freighters" arriving in May 2008.

Cathay Pacific Airways has announced that it will add Beijing to its freighter network in November after gaining approval from the Chinese Government to launch a new twice-weekly service.

The airline will use a Boeing 747-200 Freighter aircraft for the service, which commences 15 November. Flights will operate every Wednesday and Thursday from Hong Kong International Airport to Capital International Airport in Beijing. The return flight departs Beijing on Thursday and Friday.

Cathay Pacific already operates a freighter service to and from Shanghai, currently with 12 flights a week. The airline also operates 14 passenger flights to Beijing each week and a three-times-weekly passenger service to Xiamen.

Cathay Pacific Director & General Manager Cargo Ron Mathison said: "The addition of Beijing to our freighter network will open up new opportunities for shippers in the north of China and strengthen Hong Kong's position as the leading air cargo hub in Asia."

For the new service, Cathay Pacific expects the major shipments from Hong Kong and Taiwan to Beijing to be electronics and computers parts, for final assembly in the capital, along with garments. Out of Beijing, finished electronics and computer goods bound for Taiwan, the United States and Europe will fill up much of the freighter space.

Beijing will become the 29th destination in Cathay Pacific's freighter network. Chennai, Stockholm and Toronto were also added to the network this year, and the airline added an additional flight on its Dallas/Atlanta service after a successful launch in November 2005.

China Eastern Airlines will launch a new route from Shanghai to New York starting from December 8th 2006. Shanghai will become the second Chinese city, after Beijing, linked with New York via a non-stop flight. China Eastern will operate three flights a week with an Airbus A340-600 to be used.

Source: China Eastern Airlines