COVID-19 Latest Updates

California Ports Brace for Another Cargo Surge, Price of Diesel at All-Time High, Maersk Stopping all Vessel Operations in Russia and Belarus.

By May 5, 2022 No Comments

Ocean

FMC advised to expand oversight of demurrage fees to include excessive dwell fees. JOC.com reports that a shipper advisory group to the US Federal Maritime Commission (FMC) is recommending that regulators expand their oversight of unreasonable demurrage fees to include so-called excessive dwell fees that have been levied on the US West Coast. Last week, the National Shipper Advisory Committee (NSAC) unanimously approved the recommendation, pushing back against additional charges marine terminal operators say are “necessary to clear congested facilities.” The NSAC says the excessive dwell charges are unreasonable in situations where factors out of their control prevent the pickup of containers and represent an additional cost on top of already elevated container storage fees. 

Ports

California ports brace for another cargo surge. Peak season imports and an anticipated backlog of freight from mainland China are causing the ports of Los Angeles and Long Beach to brace for another cargo surge later this spring. Space for the next import surge is limited at warehouses in Southern California, as they are already operating near capacity handling merchandise for inventory replenishment. Arriving imports will soon be forced to sit on the docks until space becomes available at the warehouses. In a press conference in April, Gene Seroka, executive director of the Port of Los Angeles, said there were “46 container ships headed to Southern California, which is about normal for this time of year. But that number will increase soon enough as already-arriving back-to-school shipments, followed by early holiday merchandise imports, eventually collide with a delayed spike in shipments from Shanghai when COVID-19 lockdowns restricting goods movement in and out of the world’s busiest port are lifted.”

Customs

Customs and Border Protection update to FDA FSVP for Food Importers Data Requirements. Customs and Border Protection (CBP) published a message to the trade on April 28 that provides updates on entry data requirements for importers subject to the Food and Drug Administration (FDA) Foreign Supplier Verification Programs for Food Importers (FSVP) regulation. Currently, FDA guidance provides that FSVP Importers may temporarily submit “UNK” (unknown) in place of the DUNS number for the FSVP Importer in PG19. In issuing this guidance, FDA explained that while the agency expected all importers to provide their Unique Firm Identifier (UFI) in accordance with 21 CFR 1.509(a); the agency recognized that this was a new requirement, and some factors may have prevented importers from doing so. FDA therefore established a temporary policy providing FSVP importers unable to immediately obtain a DUNS number to transmit the value “UNK” in the UFI field for shipments subject to FSVP entry requirements. Starting July 24, FDA will end its temporary policy of permitting use of the entity identification code “UNK.” FSVP importers have now had ample time to familiarize themselves with the requirements in 21 CFR 1.509(a). Accordingly, consistent with 21 CFR 1.509(a), the FSVP importer must ensure that their valid, 9-digit DUNS number is provided in the Entity Number field. No earlier than July 24, 2022, CBP will reject an entry line of a food subject to the FSVP regulation when the importer’s DUNS number is not provided in the Entity Number field. CBP said the deployment dates in the CERT and Production environments will be announced in a future message. For details on the data requirements for entry filing relating to the FSVP regulation, please review CBP’s CSMS #17-000314 and the FDA Supplemental Guide for the Automated Commercial Environment. Read more from the FDA here.

Trucking

Price of diesel at all-time high. The national average price of diesel skyrocketed 34.9 cents to set an all-time record of $5.509 a gallon, according to Energy Information Administration data released May 2.

Rail

BNSF’s net Q1 income rose despite volume dip. First-quarter 2022 net profit rose 10% for BNSF despite a 3% decline in volumes. BNSF reported Monday that net income for 2022 quarter 1 was $1.37 billion, compared with $1.25 billion in the first quarter of 2021. Total revenues reportedly grew 10% to nearly $5.97 billion amid a 14% gain in average revenue per unit, which in turn was supported by higher fuel surcharge revenue, according to FreightWaves

Air

IAG Cargo benefiting from a 40% increase in flights between Spain and the U.S. The increase comes from its airline sister companies, Iberia and LEVEL. Iberia’s network includes regular connectivity between Madrid and Los Angeles, Boston, and Chicago, with flights to New York and Miami departing twice a day, and LEVEL has resumed flights between Boston and Barcelona. IAG Cargo now offers 120 weekly connections – a 40% increase since March

International

European ports expect surge in container volumes once Shanghai lockdown is lifted. The board chairman of the newly merged Port of Antwerp-Bruges. Says that the anticipated surge in container volumes once China’s COVID-19 lockdowns are lifted will be a “huge problem” for Antwerp. The port is already operating near maximum-capacity, reports JOC.com. “If ships come to Western Europe, they will come in one block and that is a huge problem if you don’t have the capacity,” said Annick De Ridder, port alderman of the city of Antwerp and board chairman of the port. Antwerp-Bruges will continue to focus on containers, breakbulk, roll on-roll off traffic, and chemicals.

Ocean Network Express adds new MIM connection service. Ocean Network Express (ONE), a Singaporean container line, has unveiled a new addition to its network connecting the Middle East, India and Mozambique. The new service is called MIM (Mozambique – India – Middle East) and will directly link Jebel Ali, Mundra and Maputo. The MIM service will start at Mundra on May 20. ONE’s new service will have a bi-weekly frequency and the following rotation: Jebel Ali – Mundra – Maputo – Jebel Ali.

Other

Construction begins for the world’s largest offshore wind farm. Offshore construction has commenced on the Dogger Bank Wind Farm located off the northeast coast of England. The installation of the first length of HVDC export cable off the Yorkshire coast began for the wind farm two years after onshore work began on the project. The farm will be fully completed in 2026 and will have the capacity to generate 3.6 GW.

Recent developments amid Russia-Ukraine crisis:

Maersk stopping all vessel operations in Russia and Belarus. In a statement posted to their website and sent out in an email Wednesday, Maersk announced that it has now stopped all vessel operations in Russia and service with Belarus. Domestic operations are gradually being winded down and/or divested, and the winddown does not allow for any new business in neither Russia nor Belarus. Maersk offices in Far East Russia, Novorossiysk and Kaliningrad are expected to close down during the summer of 2022. The Saint Petersburg and Moscow offices will run until the end of the year. The Belarus office will also be shut down during the summer. Read the full statement from Maersk here.

Spain turns away Maltese vessel for carrying Russian transshipment. Spanish authorities reportedly turned away the Black Star, a Maltese-registered product tanker last week citing information from the EU that the vessel was carrying a transshipped Russian cargo. The vessel was requesting permission from the Capitanía Marítima de Barcelona to arrive in port when authorities intervened and denied the vessel entry into the port, according to Maritime Executive. It was then ordered to vacate Spanish waters. The ministry cited the EU sanctions on Russian shipping for the order.