1940: Merchant Marine, American

European Service.

The war in Europe has had marked effects on shipping during 1940. The two Neutrality Act Proclamations of November 1939 and June 1940 barred a total of 113 United States ships from the North Atlantic and Mediterranean. At the end of the year, the only American flag services operating to Europe were the American Export Lines with Lisbon as their only European port, and the United States Lines, running freight vessels to the north Spanish ports of Vigo, Santander, Gijon and Bilbao.

Although there was a temporary depression in United States shipping as a result of the Neutrality Proclamations, the withdrawal of foreign flag vessels in other trades and the increase in movement of strategic materials to the United States resulted in effective economic revival. The United States flag services to the Orient, to Africa, to Australasia, and to Latin America were all measurably increased during the year. Every ship barred by the Neutrality Acts was in service at the end of the year, either through sale, charter, or rerouting.

Far Eastern Service.

Among those companies increasing their services to the Far East was the Lykes Bros. Steamship Company, which increased the number of freight vessels operating from Gulf ports to the Far East from eight to twenty. The American President Lines, Ltd., continued its Far Eastern service on a weekly basis. The first of its large new cargo-passenger vessels, the President Jackson, went into service in November.

The Puget Sound Orient Line was transferred to private ownership during the year and now operates as the American Mail Line, running six vessels from Puget Sound to the Far East. The American Export Lines increased the number of vessels sailing from United States North Atlantic ports to India from four to nine. The American Pioneer Line's Indian service, with four vessels, was sold to American Export Lines, Inc., late in 1939. Its Far East, Atlantic, and Gulf-Australian services were sold to the United States Lines Co. in February 1940, and at the same time the 12 vessels which had been operated by American Pioneer in those services were chartered to United States Lines.

African Service.

In the African trade, the Seas Shipping Company added eleven vessels to its service, making sixteen in all. The American South African Line also increased its services, as did two other smaller lines serving African ports, using chartered American flag vessels.

Latin American Service.

The east coast of Latin America was being served by a large number of ships from the United States, including 37 vessels of the American Republics Line, the Pacific Republics Line, and the Mississippi Shipping Company. Latin America's west coast was served primarily by the vessels of the Grace Line. While the total fleet operating to the west coast was not greatly increased, the addition of large new vessels brought an increase in cargo-carrying capacity.

The Alcoa Steamship Company, formerly known as the Ocean Dominion Steamship Company, continued its service to the Caribbean Islands and the Guianas with the purchase of eight vessels from the Commission to replace foreign flag ships.

Charter Market and Increased Rates.

The charter market continued high during the early months of 1940. With the shutting of the Mediterranean to American flag vessels, there was a recession of rates in June. After the end of July, a steady increase in charter demands took place, and in December the market was approximately as high as at the first of the year. Many vessels of foreign flags, including Norwegian, Swedish, Yugoslavian, and Panamanian, were chartered to American operators.

During the year there was also a large increase in freight rates on a number of commodities, such increases ranging from ten per cent to as much as one hundred per cent. The most marked increases were noted in commodities which formerly moved in tramp steamers, since practically all such shipping was withdrawn as a result of the war.

War risk insurance, in effect on nearly all American flag vessels in foreign trades, resulted in a substantial increase in the cost of operations.

As a result of the increased tempo of the Maritime Commission's construction program, 179 ships were contracted for as of Dec. 15. Eighty-five of these had been launched, and of these 85, 56 were in service.

Naval Service.

The Navy during the year acquired twelve large national defense tankers, and eleven other vessels built under the Maritime Commission's program, for use as cargo and ammunition carriers, seaplane and submarine tenders, transports, etc. It also bought 14 older cargo ships, and about 100 smaller boats for trawlers, etc.

Transfer to Foreign Ownership.

During the period from Sept. 3, 1939 to Dec. 10, 1940, a total of 221 vessels of the cargo, cargo-passenger and tanker types of 1,000 gross tons and over were approved by the Maritime Commission for transfer to foreign ownership. The vast majority of these vessels had reached or exceeded twenty years of age, at which age a vessel is usually obsolete. Of the vessels in those categories, 82 of 443,822 gross tons were approved for transfer to Great Britain; 10 of 41,399 gross tons to Canada; and 20 of 114,839 gross tons to France and Belgium. Proceeds of the sale of many of the merchant ships were earmarked for the construction of new ships, thus assuring the continued rehabilitation of the American merchant marine.

The regulatory powers of the Maritime Commission over continental coastwise and intercoastal shipping under the Transportation Act of 1940 were transferred to the Interstate Commerce Commission as of Jan. 1, 1941, subject to the right of the latter body to postpone transfer if it deems it necessary.

Training of Personnel.

The Maritime Commission made substantial progress in its training program for licensed and unlicensed seamen and apprentices. Including special national defense classes in radio, visual signalling, and gunnery, more than 10,000 officers, cadet officers, cadets, unlicensed personnel, and apprentices chosen from the C.C.C. camps, had been or were being trained by the end of 1940.

Transportation of American Citizens from Foreign Zones.

The repatriation of American citizens from Europe continued during the early part of this year, and during the summer three vessels of the United States Lines Company were diverted to Galway and a French port to expedite the return of United States citizens from combat zones. In the fall of 1940, the State Department, in collaboration with the Maritime Commission and ship operators, arranged for the return of American citizens from the Far East and three vessels were diverted from their regular service to assist in this repatriation work. The American President Lines with vessels in a fortnightly service from the Orient carried many American citizens returning from that area.

Other Developments.

On the Great Lakes cargo shipments were heavier than ever, and the ore-carrying lines had the best year in their history. Most of the trade consisted in carriage of iron ore from the head of the Lakes to Lake Erie, and the bringing of coal on the return voyage.

The first American vessel to be a victim of the war was the City of Rayville, which was sunk on Nov. 8 off the coast of Australia. All but one of the crew were saved.