Russia’s 1H’09 Fisheries Increase 6.8% to over 1.6 million Tonnes
Russian fishing organizations increased their catch of fish and other seafood products 6.8%, or by 105,800 tonnes, to 1.658 million tonnes in the first half of 2009 compared to the same period of 2008, the Russian State Fisheries Committee said on June 30.
In the Far Eastern seas, fishermen caught 1.052 million tonnes of fish in the half, up by 39,600 tonnes from the same date of 2008.
The catch in the Bering Sea fell by 13,900 tonnes to 141,600 tonnes.
In the northern and southern Kuril Islands, the catch increased by 16,200 tonnes to 85,500 tonnes.
The fish catch in the Sea of Okhotsk grew by 35,300 tonnes to 808,900 tonnes.
The catch in the Barents Sea and the White Sea increased by 85,600 tonnes to 258,800 tonnes so far this year.
In the Baltic Sea, the catch grew by 3,100 tonnes to 25,600 tonnes.
The catch in the Azov and Black seas rose by 4,900 tonnes to 19,100 tonnes.
The fish catch in the Caspian Sea was up 8,200 tonnes to 23,700 tonnes.
Russian fishermen caught 212,400 tonnes of fish in other countries’ zones this year, or 16,000 tonnes more than a year ago.
A total of 68,000 tonnes of fish were caught in regions governed by convention and on the high open seas in the period, down by 51,800 tonnes from a year ago.
Cost of U.K. Carriers Reported To Jump 25%
British plans to build two 65,000-ton aircraft carriers are facing renewed controversy after the leak of a memo from the industrial alliance building the warships detailing that costs had risen by about 1 billion pounds (C$1.9 billion) since late last year.
A memo obtained by the BBC said that the cost of building the Royal Navy’s biggest-ever warships had ballooned by about 25 percent to around 5 billion pounds. About two-thirds of the cost increase was attributed to a government decision last December to delay the warships’ introduction into service by up to two years as part of an effort by the Ministry of Defence (MoD) to reduce its equipment spending profile over the next two or three years and help offset a gaping hole in its budget. The government said at the time that pushing back the new carriers would better align their availability to the introduction of the short-takeoff-and-landing version of the Joint Strike Fighters the British plan to purchase to equip the warships.
On the current timeline, the first of the warships is scheduled to be in service in 2015 followed by the second in 2018.
Along with the time delay, other cost increases resulted from inflation, interest on capital, some design changes and other issues. The deal was only signed between the BVT-led alliance building the carriers and the MoD in mid-2008 after years of haggling over costs and specifications.
The carrier alliance includes the BAE-VT Group-owned BVT, Babcock International, Thales UK and the MoD. The warships are being built in modules across yards in the U.K. and floated round to Babcock’s Rosyth facility in Scotland for final assembly.
The memo, which was written for alliance chief executives, conceded that the increased cost meant there was a “very real fight for the program’s survival.”
Procurement minister Quentin Davies reaffirmed the MoD’s position June 29, saying on the radio that there was no question regarding the carriers’ delivery. An MoD spokeswoman said the ministry was “currently re-costing the program. The MoD accounts published next month will present an initial estimate, and the formal costing will be available until later in the year.
“We took the decision to delay the two future aircraft carriers in December 2008. We did this in order to reprioritize investment to meet current operational priorities and to better align the program with the Joint Strike Fighter aircraft. We acknowledged at the time that there would be a cost increase as a result”, she said.
The future of the Royal Navy’s CVF carrier has been under question for years as the MoD attempts to balance spending plans with available cash.
The Royal Air Force and others have been actively trying to sink the program, most recently during budget planning for 2009-2010. U.K. analysts reckon one way the British could tackle the cost overrun would be to cancel the second of the carriers. That, however, would come with a cost penalty of its own.
The renewed controversy comes at a time when attention is turning to exactly how much damage Britain’s already under-funded military might suffer in any upcoming budget cuts caused by the need to pay down the country’s huge public debt.
Spending was an issue addressed by an Institute for Public Policy Research report released Tuesday that looked at the security strategy. The study said the future of programs such as the carrier, Type 45 destroyers, Joint Strike Fighter and the Astute nuclear submarine should be reviewed.
“It is clear there is a black hole in the defense budget … The Government should thoroughly re-examine, as part of a strategic review of security, its projected defense equipment requirements. This re-examination should explore all viable options for capability downgrading and quantity reduction as well as for complete cancellation of some equipment programs,” the report said.
The report’s authors include Lord George Robertson, the former Secretary of State for Defence and former NATO general secretary, and Gen Lord Charles Guthrie the former chief of the Defence Staff.
Cost Goals for U.S. Navy’s Littoral Combat Ship Overly Optimistic
National Defence magazine reports that U.S. Navy Secretary Ray Mabus raised doubts in recent weeks that the Navy can meet a $460 million cost cap for the Littoral Combat Ship. Mabus told lawmakers that he expects to know the answer by early fall.
But LCS’s short and troubled history suggests that Mabus’ prediction may reflect more hope than reality. The LCS has been under fire for its rising costs — from an initial estimate of $220 million per ship to price tags that nearly triple that amount.
Out of frustration with the process, members of Congress called for a $460 million cost limit and demanded that the Navy only buy these ships under fixed-priced contracts. Three congressional defense committees will be debating this issue in the coming weeks. Particularly contentious will be the determination of what portions of the shipbuilding contracts will be treated as fixed costs, and which ones will be given allowances for inflation or raw materials price increases.
Regardless of how these issues are settled between Congress and the U.S. Navy, it is clear that shipbuilders themselves have a tough time estimating precisely how much a ship will cost because the industry has not in the past worked under such strict price controls. Also complicating matters is that the LCS is a new ship, and the contractors are still trying to figure out how to build it more efficiently.
“There’s a learning curve,” said Lockheed Martin Maritime Systems & Sensors President Fred Moosally. He oversees one of the two competing teams that are vying for LCS production contracts in fiscal year 2010. Both Lockheed and General Dynamics are bidding for a three-ship contract under which the Navy will acquire the vessels for a pre-arranged fixed price. During a June 23 meeting with reporters, Moosally said that there are many variables that could affect the cost of LCS, such as securing a vendor base, work force stability, manufacturing processes, materials, and the company’s ability to procure components in advance of construction.
Moosally declined to specify how much savings Lockheed’s team could achieve because the program is still in a competition. But he said that the most important factor in lowering costs is having steady orders for multiple ships and multiyear contracts. The Navy’s budget troubles and chronic shortfalls in its shipbuilding accounts put into question if and when it will be in a position to afford large orders of LCS.
“We’re going to continue to monitor the budget process,” said Moosally. “If we can get a line up and running, stabilize the vendor base, then you accrue savings through multiyear procurements and a stabilized work force.” To do that, however, “We need to build more than one ship a year.”
Lockheed’s team was awarded a fixed price incentive fee contract in March for the Navy’s third LCS, which was named Fort Worth. The team includes naval architect Gibbs & Cox, ship builders Marinette Marine Corp. and Bollinger Shipyards.
“In shipbuilding, it’s important to have stable production runs,” said Byron Callan, a defense industry analyst at Perella Weinberg. Ship programs require a stable work force to be cost-competitive, he said. This should be a major concern for U.S. shipbuilders because it takes four to nine years for entry-level yard workers to build basic competency.
Any major defense program seeking long-term stability is in trouble right now because of the fiscal uncertainty in the Defense Department, Callan said at a recent panel discussion in Washington, D.C. “Stability and predictability in design seem to be ill suited in a world that’s anything but stable or predictable.”
