The Federal Maritime Commission should move forward with a rulemaking to clarify reasonable practices for assessing of demurrage, detention and per diem charges, the American Apparel and Footwear Association said in comments (here). The comments are in response to an FMC request for comments (here) that followed a petition filed by the Coalition of Fair Port Practices (see 1612080021). "Our member companies have repeatedly relayed to us their experiences of severe congestion and delays at container terminals in U.S. ports for which they have been forced to bear the costs of demurrage and detention for incidents largely out of their control," the AAFA said. The FMC needs to address this problem and should "grant the petition and open a rulemaking to ensure that U.S. imports and exports are not burdened with unfair demurrage and detention charges," it said.
The reduced number of shipping alliances -- soon to be down from four to three -- is a "market-driven phenomenon" and not necessarily anti-competitive, Commissioner Rebecca Dye of the Federal Maritime Commission said during a Jan. 31 National Industrial Transportation League event (here). "The alternative to operational alliances is not the status quo," she said. "The dynamics of our liner shipping markets will continue to produce commercial and economic change," she said. The agency holds no position on alliances in general, but will seek "to ensure that the dynamics of the marketplace determine economic outcomes," she said. The Justice Department Antitrust Division voiced objections to the FMC over two recent alliance proposals and advised the agency to stop the alliances in court (see 1611280024). While the FMC didn't stop the alliances, it used analysis similar to the DOJ's and the Federal Trade Commission's, Dye said. One recent staff paper found that "the impending reduction from four to three strategic alliances should, considered in isolation from other factors, actually decrease freight rates." Dye also provided an update on the Supply Chain Innovation Teams (see 1605030029) and said the coming next phase will focus on export supply chains. "I will also continue to pursue options for the development of a robust conceptual model or a pilot project for a national portal for critical supply chain information," she said.
A new Commerce Department report offers some suggestions toward improving port efficiency based on some best practices used around the country, a Commerce news release said (here). Commerce compiled a list of effective operational practices at individual ports as part of the report (here). “More than 70 percent of America’s international merchandise trade flows through our seaports, linking our producers and retailers with their sources and customers and our nation’s supply chains with the global economy,” Commerce Secretary Penny Pritzker said in the release. “The efficiency and productivity of U.S. seaports and their connecting infrastructure is crucial to our nation’s ability to successfully compete in the global marketplace.” Increased communications through working groups, use of port information sharing technologies and planning improvements for chassis availability are among the suggested improvements. The report is based on port roundtables and recommendations from the Commerce Advisory Committee on Supply Chain Competitiveness (see 1609010022).
A national portal with Information such as container, chassis and dray truck availability would improve port performance and boost U.S. competitiveness, according to Supply Chain Innovation Teams that Federal Maritime Commissioner Rebecca Dye has led since May, the Federal Maritime Commission said (here). The teams found that meaningful, specific information, rather than “vast volumes of unfiltered data,” would help U.S. companies engaged in trade. The three teams, which averaged 12 members each, focused on imports through the ports of Los Angeles, Long Beach and New York/New Jersey, according to the executive summary of the teams’ interim status report (here). Dye’s Supply Chain Innovation Initiative will launch “Phase Two” next year, and will consist of three teams, focus on exports and pursue a “robust conceptual model” for a national supply chain portal, FMC said.
The Federal Maritime Commission will carefully consider a petition filed by the Coalition for Fair Port Practices for the agency to issue a rulemaking preventing common carriers and marine terminal operators from charging demurrage, detention and per diem fees during events beyond the control of shippers, FMC Chairman Mario Cordero said in a statement emailed to International Trade Today. The 25-member coalition submitted the petition on Dec. 7 (see 1612080021). Cordero said given the “seriousness” of the issues raised in the petition, FMC will determine “the most appropriate next step.” Cordero added: “Given the Commission’s commitment to maintaining the most efficient ocean-linked supply chain system possible, we are always interested in allegations of any practices or behavior that contribute to diminishing efficiency or increasing costs.”
The Department of Homeland Security’s 1,400 radiation portal monitors at U.S. ports of entry are 100 percent operational and can function beyond their estimated service life, until at least 2030, as long as they are properly maintained and spare parts remain available, according to a Government Accountability Office report released Nov. 30 (here). DHS started planning for replacing the entire fleet in fiscal 2014 and 2015, as the monitors began to reach the end of their estimated 13-year service life, but the department in 2016 changed to a selective replacement policy, entailing the use of monitors upgraded with new alarm threshold settings or buying “enhanced, commercially available” monitors to gain operational efficiencies and reduce labor requirements at some ports, GAO said. During fiscal years 2016-2018, DHS plans to replace about 120 monitors along the northern border with upgraded units, and from fiscal year 2018 through fiscal year 2020, intends to replace monitors that can’t be upgraded with new alarm thresholds at northern land border crossings with existing upgraded inventory, the report says.
The State Department and other agencies are considering whether to approve an amended Texas Department of Transportation application to build a second bridge for southbound traffic crossing the U.S.-Mexico border at Presidio, Texas, and Ojinaga, Mexico, State said (here). State received the application for an amended presidential permit Sept. 7, and is circulating it to relevant federal agencies for review. Agencies will consider foreign policy, environmental, cultural and economic impacts, as well as compliance with existing laws and regulations, among other things, State said. State is accepting public comments through Oct. 27.
A $10 million Transportation Department grant for the Port of Everett, Wash., will help the port complete modernization of its south terminal and double its rail capacity, facilitating the support of larger vessels and heavier cargo, the office of Sen. Patty Murray, D-Wash., said in a statement (here). The port sees the export of $25 billion worth of goods every year, supporting Washington state’s aerospace, construction, manufacturing and energy sectors. “With this federal investment, we will be able to modernize our facilities to continue to support the aerospace, manufacturing and construction industries in the region,” port CEO Les Reardanz said in a statement.
An increase in the number of cargo ships bound for the U.S. but later redirected to other North American ports was a result of congestion issues during 2015, the Federal Maritime Commission said in a report (here). "The annual increase in congestion rates combined with the labor disputes of late 2014 and early 2015 and the growing attraction of foreign ports as a means of getting cargo into the United States all led to the continued growth of cargo diversions in 2015," the FMC said in the report, an update to the commission’s 2012 “Study of U.S. Inland Containerized Cargo Moving through Canadian and Mexican Seaports." The agency pointed to three main factors that led to increased use of neighboring countries' ports: "port congestion, stale trade growth, and the ability of U.S. importers to determine cargo routing as part of their corporate import strategy."
Steps taken by some ocean carriers and terminal operating companies are “encouraging signs” for smooth implementation of new Safety of Life at Sea verified gross mass (VGM) container weighing requirements that take effect July 1, Federal Maritime Commission Chairman Mario Cordero said July 29 (here). At least four ocean carriers have published customer advisories in recent days saying that they will accept VGMs as determined by scales at marine terminals, he said. Cordero also praised a recent agreement between the Ocean Carrier Equipment Management Association and six East Coast ports that would allow use of terminal-determined weights (see 1606270039).