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Ocean Shipping Industry Requesting Overhaul on Emission Directives, CPSC Unveils E-Filing Plans During NCBFAA Conference, Surface Transportation Board Wants Improvement Updates from Class I Railroads

By May 12, 2022 No Comments

Ocean

Ocean shipping industry requesting overhaul on emission directives. Bloomberg reports that the World Shipping Council (WSC) is asking the International Maritime Organization (IMO) to overhaul emissions directives so that all carriers are “working off the same rulebook as they make the expensive changes needed to cut output of harmful carbons,” and ensure the regulations are equally applied. The ocean shipping industry is one of the world’s biggest polluters and reportedly emits more carbon annually as Germany and the Netherlands combined, thus the need for emissions directives. 

Ports

Ports of LA/Long Beach to Reconsider Container Dwell Fee. Via the NCBFAA Monday Morning eBriefing: “The ports of Los Angeles and Long Beach have continued to postpone their “Container Dwell Fee,” and said they will reconsider its possible imposition on May 20. The executive directors of both ports will reassess fee implementation after monitoring data over the next week. Fee implementation has been postponed by both ports since it was announced on Oct. 25, but it remains a threat to the industry. Under the temporary policy approved Oct. 29 by the Harbor Commissions of both ports, ocean carriers can be charged for each import container that falls into one of two categories: In the case of containers scheduled to move by truck, ocean carriers could be charged for every container dwelling nine days or more. For containers moving by rail, ocean carriers could be charged if a container has dwelled for six days or more. The fee has been set at $100 per container, increasing in $100 increments per container per day of excess dwell time beyond the prescribed period. The port authorities have stated the fees collected from dwelling cargo will be “reinvested for programs designed to enhance efficiency, accelerate cargo velocity and address congestion impacts.” 

Customs

CPSC unveils e-filing plans during NCBFAA conference. An official from the Consumer Product Safety Commission (CSPC) outlined the agency’s plans to implement its ACE Message Set at NCBFAA’s Annual Conference on May 2. The plans will start with a pilot program involving participation from some importers and customs brokers. CPSC will continue the concept of a certificate “registry” which was first proposed in 2016. Importers will be allowed to upload the certificate enforcement data covering multiple shipments into a CPSC electronic registry. Brokers will then be able to provide a Product Registry reference number at entry for all shipments covered by the certificate, rather than having to enter the complete Message Set for each shipment. A Federal Register notice is expected by this summer, and the e-filing pilot is set to begin in 2023. CPSC expects that mandatory implementation of its CPSC Message Set will occur in 2025. More details are available in this Staff Briefing Package that was approved by CPSC in 2020.

Trucking

U.S. and Mexico considering expanded joint cargo processing efforts. The U.S. and Mexico are looking to expand the unified cargo processing program to speed up U.S.-bound shipments across the shared border. Under the initiative, officials from both the U.S. Customs and Border Protection (CBP) and Mexico’s Tax Administration Service (TAS) conduct joint cargo inspections of trucks at the facilities of the importing or exporting country. Should no issues arise, the driver and truck are released and the import is allowed to enter U.S. commerce directly. If an issue is uncovered, such as a prohibited good, the shipment is then sent for another examination, conducted jointly by CBP and SAT. 

Increase in trucking employment suggests confidence in freight demand. An increase in trucking employment last month indicates that demand for freight remained high and for-hire trucking firms were confident enough to keep adding jobs. According to unadjusted data released by the U.S. Bureau of Labor Statistics (BLS), trucking companies added 14,100 jobs in April, a substantial increase from the 9,000 jobs added last year in April 2021. Ongoing labor shortages and supply chain disruption were the direct cause for the need for new hires to haul freight that continues to land at US ports and leave factories and warehouses. The jump in trucking employment last month was the largest increase since April 2013, when trucking companies added 22,400 jobs in one month, according to JOC.com.

Rail

Surface Transportation Board wants improvement updates from Class I railroads. Four U.S. Class I railroads must each submit a report to the Surface Transportation Board (STB) outlining how they expect to improve rail service. Union Pacific (NYSE: UNP), BNSF (NYSE: BRK.B), CSX (NASDAQ: CSX) and Norfolk Southern (NYSE: NSC) are required to submit service recovery plans and provide biweekly written progress updates. They will also participate in biweekly conference calls with STB staff. Additionally, the board also wants data on operations and employment from all the Class I railroads. The request comes after STB’s two-day hearing in April held in response to reports from shippers about “deteriorating rail service,” according to FreightWaves. The plans and data submitted by the railroads will help STB assess whether further actions may be needed. The requirements also aim to “promote industry-wide transparency, accountability and improvements in rail service,” STB said. 

Air

Air Transport Services Group to lease freighters to Dublin cargo airline. A Dublin-based contract airline that serves customers such as Amazon Air and FedEx has ordered five Airbus converted freighters from Air Transport Services Group (ATSG). This builds on the first-quarter profit contribution of ATSG’s leasing arm. ATSG reported a revenue increase of 29% to $486 million and adjusted pretax earnings of $64 million, more than triple the amount in 2021, directly linked to a larger Boeing 767 fleet and greater passenger flying for the military. According to FreightWaves, ASL Aviation Holdings will lease ATSG’s first two A321-200 narrowbody freighters in the second half of the year, with a third aircraft scheduled for delivery in 2023. The airline will also receive two A330 retrofitted freighters in 2024.

International

Shanghai continues to tighten lockdown measures. China’s top leader Xi Jinping pledged to “unswervingly” double down on the country’s controversial zero-Covid policy, CNN reports. Millions of residents continue to be confined to their homes with no end in sight. Many videos showing Shanghai residents arguing with hazmat suit-clad workers and police officers while being forcefully taken away for government quarantine have since been removed by censors after sparking public outcry. Under the new policies residents with negative Covid tests can also find themselves placed into centralized government quarantine. Concerned about the recent developments in China and how they’ll affect your supply chain? Contact a Navegate expert to learn more.

Beijing shuts down public transportation in effort to curb continued Covid spread. Beijing has shut down many metro stations and bus routes in an attempt to avoid the same situation as Shanghai, where millions of people have been under strict lockdown for more than a month. More than 60 subway stations, about 15% of the network, and 158 bus routes were shut down, service providers said, most in the Chaoyang of Beijing.

Other

U.S. Trade Deficit Widens. On May 4 the U.S. Census Bureau reported that the trade deficit in the U.S. is continuing to widen. In March the deficit grew by 22.3% to $109.8 billion as imports continue to outpace exports. You can read the full report here.

Recent developments amid Russia-Ukraine crisis:

Transport providers face costs from Russian exit. In the rush to withdraw services from Russia in the wake of the Ukraine invasion, many transport providers are finding the undertaking to be extremely expensive. JOC.com reports that in its first-quarter results released this week, Maersk put the price of “disengaging from all activities in Russia” at $718 million, with almost half of that linked to unwinding its 30 percent investment in Russian port operator Global Ports International. 

U.S. House of Representatives approves $40 billion in aid to Ukraine. On Tuesday, the U.S. House of Representatives approved a $39.8 billion aid package for Ukraine, just days before the end of President Biden’s authority to fund military supplies to help defend Ukraine from Russian attack. The bill passed 368 to 57. It will now proceed through the Senate and then to the president’s desk. Senate Majority Leader Chuck Schumer said ahead of the vote that the Senate will act on the aid package “as soon as possible,” according to CBS News.