Transportation Roundup: Container, equipment shortages continue for SSGA members

/0 Comments/in

SSGA staff have compiled a round up of current news in the container transportation industry. Click the links below to view the original stories.

A shortage of shipping containers and equipment were again common themes in reports from SSGA member exporters in SSGA’s Competitive Shipping action team meeting Aug. 10. Multiple SSGA members reported that the shortage isn’t affecting Chicago as much, but other container yards in the Midwest remain extremely short of containers and chassis. Members also reported a trend of lower surcharges and some weakening container rates. The Competitive Shipping action team meets quarterly. Contact Katelyn if you are interested in joining the action team.

The Presidential Emergency Board issued its recommendations for a new rail labor contract, suggesting a 24% wage increase over five years. This splits rail labor request for a 31.3% increase compared to the railroad offer of 17%. If the two sides cannot reach an agreement by Sept. 16, Congress may need to intervene to prevent a strike or lockout. Read the full recommendations here.

In attempt of diversifying supply chains and build on self-sufficiency in the Midwest, the North Dakota Trade Office Duluth Cargo Connect and Valley Worldwide Logistics Solutions have established a logistics network between Duluth and Europe. The network is a single source solution for domestic trucking, drayage, ocean freight forwarding, transloading, warehousing and overstuffing. Valley Worldwide will be offering direct intermodal vessel service between Duluth, Minnesota and Antwerp, Belgium via the Great Lakes and St. Lawrence Seaway, with more worldwide routings in the works. For more information, contact Ian Nicks with Valley Worldwide at Ian@valleyexp.com or 951-233-5347.

U.S. grain exports continue to be a highlight of the Great Lakes shipping season. The Great Lakes ports traded with at least 27 countries during July, according to the St. Lawrence Seaway tonnage report. Through July, the seaway system has moved 514,000 tons of U.S. grain, a 37% increase compared to 2021. Learn more here.

While shipping container fees are decreasing in most parts of the world, five U.S. ports top the list of most expensive detention and demurrage (D&D) fees. The average D&D charge at the Port of New York is $3,182, followed by Long Beach, Los Angeles, Oakland and Savannah. Read more from CNBC here.

Transportation Roundup: Federal agencies seeking public comments

/0 Comments/in

SSGA staff have compiled a roundup of current news in the container transportation industry. Click the links below to view the original stories.

After meeting with truckers and marine terminal operators at the Port of New York and New Jersey, Federal Maritime Commission (FMC) Chairman Dan Maffei is warning ocean carriers to stop forcing shippers and drayage truckers to store their containers or pay a fee when they do so.

“The (FMC) has already been investigating reports of carriers charging per diem container charges even when the shipper or trucker cannot possibly return the container due to terminal congestion,” Maffei said. “I will ask that this investigation be broadened and intensified to cover instances where shippers and truckers are being forced to store containers or move them without proper compensation.”

Read more about the proposed fees here.

The FMC is seeking public comments on a new data collection regarding containerized vessel imports and exports as part of requirements established in the Ocean Shipping Reform Act.

The Act requires the FMC to collect and publish quarterly the total import and export tonnage and total loaded and empty 20-foot equivalent units (TEU) per vessel. The FMC’s proposal would collect tonnage and TEU information each month from ocean common carriers that transport 1,500 or more TEUS per month. Implementing this approach would collect at least 99% of all imported and exported containerized cargo. Interested parties can share their comments with the FMC for 60 days once the request is published in the Federal Register.

Read more here from the FMC.

The Surface Transportation Board is also seeking comments on its draft environmental impact statement regarding the potential Canadian Pacific and Kansas City Southern merger. The study concluded that train noise could be the largest environmental impact while other adverse impacts would be negligible, minor and/or temporary.

If approved, the merged rail company would make capital improvements including new or extended passing sidings, adding a section of double track and adding facility working track to 25 locations along the network.

Read more about the impact study and proposed merger here.

Other noteable transportation news:

Transportation Roundup: Unconventional peak season ahead

/0 Comments/in

SSGA staff have compiled a roundup of current news in the container transportation industry. Click the links below to view the original stories.

At Container xChange’s recent webinar, analysts discussed their predictions for an unconventional 2022 container shipping peak season, with massive inventory levels in warehouses as one culprit. One expert believes that issues in the container shipping market would continue even if there were no container shipments in the next six months. Read the full story recap here.

President Biden signed the Ocean Shipping Reform Act (OSRA) last month to expand the Federal Maritime Commission’s (FMC) authority to ensure a competitive and reliable international ocean transportation supply system. Requirements surrounding demurrage and detention charges, a hot topic among U.S. shippers, became effective upon the law passage on June 16. Read the full story here.

FMC Commissioner Carl Bentzel reported that the agency may need more staff to properly enforce the reforms from the OSRA. The OSRA increased funding to the FMC, but hiring enough staff will take time. Read more here.

In lighter news, here’s a story from Maritime Executive about the history of one of SSGA’s favorite topics: the shipping container.

Transportation Roundup: ‘Bringing a wooly mammoth back to life’

/0 Comments/in

SSGA staff have compiled a roundup of current news in the container transportation industry. Click the links below to view the original stories.

A prospective ship-to-rail container terminal on Oregon’s coast, the Pacific Coast Intermodal Port in Coos Bay, could help transform West Coast port infrastructure, but refurbishing and upgrading existing infrastructure would be like “bringing a wooly mammoth back to life,” according to Chad Meyer, president of NorthPoint Development. NorthPoint Development, the largest U.S. developer of warehouse and e-commerce fulfillment centers, applied for $1.4 billion in federal funding to invest in heavy infrastructure for container handling at the terminal. They received additional support after 13 members of Congress sent a letter to the White House in June. One hundred twenty miles of railroad owned by Coos Bay Rail Line would also need to be upgraded to get the terminal ready to handle containers. Existing Coos Bay terminals handle lumber and wood products, general cargo, liquid bulk shippers and fishing fleets. Read more about the project here.

Several SSGA members have reported very low availability of trucking equipment in the Upper Midwest, but in positive news, trucking employment numbers in the last three months are nearly double compared to the same time last year. A record 62,400 workers were added to payrolls in April, May and June. This could be in part due to independent drivers returning to work as spot rates decline, according the Journal of Commerce here.

Other positive news for container shipping shows that the post-COVID container demand boom may have run its course. Drewry’s post throughput index showed a decline in April, including a 25% decline at Shanghai. Because of the softening demand, some companies are now renegotiating shipping agreements that were made during the surge or taking advantage of lower rates on the spot market. Rates are spotty though, with shipping costs remaining high in areas of congestion, such as China to Chicago, and many are still reporting higher rates than those paid before the pandemic. Read more from the Wall Street Journal.

SSGA applauds Ocean Shipping Reform Act passage

/0 Comments/in ,

Relief is finally in sight for agricultural shippers, after President Biden signed the Ocean Shipping Reform Act of 2022 on Thursday.

The law will ensure a more competitive global ocean shipping industry and provide relief to U.S. exporters, including Specialty Soya and Grains Alliance (SSGA)-member agricultural exporters, who have struggled with significant supply chain disruptions over the past two years. It will also provide the Federal Maritime Commission (FMC) with new, additional enforcement authority to address unreasonable and unfair ocean carrier practices that have been harmful to U.S. exporters, including prohibiting carriers from unreasonably declining opportunities to U.S. exports.

“The Ocean Shipping Reform Act of 2022 gives the Federal Maritime Commission additional authority and tools to protect U.S. exporters from ocean carrier practices they determine to be unfair and illegal,” said Darwin Rader of Zeeland Farm Services, an SSGA board director and chair of the alliance’s competitive shipping action team. “Hopefully, the end result will be that U.S. ag exporters will have the opportunity to ship their goods to customers around the globe in a timely manner at a fair price.”

SSGA Chair Rob Prather, AgTC Executive Director Peter Friedmann and SSGA Executive Director Eric Wenberg

The House first passed a version of the bill in December, and the Senate passed its version by unanimous consent on March 31. Rather than reconcile the two bills by conference committee, the House opted to pass the Senate version. The U.S. House of Representatives overwhelmingly passed the Senate version of the bill, 369-42 on Monday, and the president signed it at a ceremony on Thursday at the White House.

SSGA appreciates the hard work of the bill’s sponsors, Sens. Amy Klobuchar (D-Minn.) and John Thune (R-S.D.), and Reps. John Garamendi (D-Calif.) and Dusty Johnson (R-S.D.) for their bipartisan efforts in getting through the bill that will support agricultural shippers.

“We applaud the work that’s been done so far,” SSGA Executive Director Eric Wenberg said. “We’ve used our expertise in intermodal shipping to inform and educate the debate and will continue to do so. With three of the four congressional sponsors being from South Dakota and Minnesota, we trust that the message is clear and that the final rule, when it emerges, will support agricultural shippers from the central United States.”

SSGA has long supported passage of the Ocean Shipping Reform Act and has worked since October 2020 to inform the general public about the supply chain crisis, working on behalf of its members who export high-quality, Identity Preserved and specialty grains and oilseeds to help them meet the needs of their overseas customers.

Lack of service, carrier cancelations, delays and rising freight rates and fees had “reached a condition critical situation,” said SSGA Chairman Rob Prather, chief strategic ambassador for Iowa-based Global Processing, affected business and have had a human toll, as well, causing hardships to logistics staffs, farmers, truckers, suppliers and customers both in the U.S. and abroad.

This week, SSGA held its quarterly board meeting in Tacoma, Washington and attended the Agriculture Transportation Coalition’s (AgTC) annual meeting there. During the AgTC meeting, Klobuchar, in a video message, acknowledged SSGA, among others, for supporting the Ocean Shipping Reform Act and for championing ag exports.

SSGA also has great appreciation for AgTC and its efforts to help get the act to Congress.

The Ocean Shipping Reform Act will:

  • Require ocean carriers to certify that late fees — known as “detention and demurrage” charges— comply with federal regulations or face penalties;
  • Shift burden of proof regarding the reasonableness of “detention or demurrage” charges from the invoiced party to the ocean carrier;
  • Prohibit ocean carriers from unreasonably refusing cargo space accommodations for U.S. exports and from discriminating against U.S. exporters;
  • Require ocean common carriers to report to the FMC each calendar quarter on total import/export tonnage and 20-foot equivalent units (loaded/empty) per vessel that makes port in the United States;
  • Authorize the FMC to self-initiate investigations of ocean common carrier’s business practices and apply enforcement measures, as appropriate; and
  • Establish new authority for the FMC to register shipping exchanges.

“This new legislation is important and long overdue,” said SSGA board director Bob Sinner of SB&B Foods. “We’ve been waiting for this for many, many months. I am hopeful that the rulemaking that follows this legislation ensures that equipment gets where it’s needed. At the end of the day that’s what’s needed in rural America.”

Ocean Shipping Reform Act to become law

/0 Comments/in ,

Ag shippers from central U.S. in need of relief

More than 2 ½ years ago, the Specialty Soya and Grains Alliance was one of the first agricultural associations to sound the alarm on the crisis taking place in container shipping. Finally, some relief is in sight, as the Ocean Shipping Reform Act of 2022 is heading to President Biden’s desk. On Monday, U.S. House of Representatives overwhelmingly passed the Senate version of the bill, 369-42.

The House first passed a version of the bill in December, and the Senate passed its version by unanimous consent on March 31. Rather than reconcile the two bills by conference committee, the House opted to pass the Senate version.

SSGA acknowledges the bill’s sponsors, Sens. Amy Klobuchar (D-Minn.) and John Thune (R-S.D.), and Reps. John Garamendi (D-Calif.) and Dusty Johnson (R-S.D.) for their bipartisan efforts in getting through a bill that would provide the Federal Maritime Commission with new, additional enforcement authority. It also will ensure a more competitive global ocean shipping industry and provide relief to U.S. exporters, including SSGA-member agricultural exporters, who have struggled with significant supply chain disruptions over the past two years.

“We applaud the work that’s been done so far,” SSGA Executive Director Eric Wenberg said. “We’ve used our expertise in intermodal shipping to inform and educate the debate and will continue to do so. With three of the four congressional sponsors being from South Dakota and Minnesota, we trust that the message is clear and that the final rule, when it emerges, will support agricultural shippers from the central United States.”

Once signed, the law also would provide additional enforcement tools to address unreasonable and unfair ocean carrier practices that have been harmful to U.S. exporters, including prohibiting carriers from unreasonably declining opportunities to U.S. exports.

On Tuesday, SSGA will hold its quarterly board meeting in Tacoma, Washington, prior to the annual meeting of the Agriculture Transportation Coalition’s annual meeting where senators and representatives who sponsored the Ocean Shipping Reform Act are scheduled to appear.

SSGA has long supported passage of the Ocean Shipping Reform Act and has worked since October 2020 to inform the general public about the supply chain crisis, working on behalf of its members who export high-quality, Identity Preserved and specialty grains and oilseeds to help them meet the needs of their overseas customers.

Lack of service, carrier cancelations, delays and rising freight rates and fees have “reached a condition critical situation,” according to SSGA Chairman Rob Prather, chief strategic ambassador for Iowa-based Global Processing, affected business and have had a human toll, as well, causing hardships to logistics staffs, farmers, truckers, suppliers and customers both in the U.S. and abroad.

Transportation Roundup: SSGA urges FMC funding increase

/0 Comments/in

SSGA staff have compiled a roundup of current news in the container transportation industry. Click the links below to view the original stories.

SSGA joined other several other agricultural organizations urging the U.S. House and Senate Transportation-HUD Appropriations Subcommittee to consider increasing fiscal year 2023 funding to the Federal Maritime Commission, up to the $38,260,000 authorization level included in the Ocean Shipping Reform Act. The letter preceded the House passage of the Ocean Shipping Reform Act, which is now headed to President Biden’s desk for approval. View the letter here.

The Journal of Commerce will analyze the rankings in its Top 100 Importers & Exporters report during a webcast on Thursday at 1 p.m. CST. With strong consumer spending, total containerized trade in and out of the U.S. rose 7.8 percent in 2021, with import gains in many segments, including automobiles and parts, household goods, toys, clothing, electronics and foodstuffs. JOC will analyze the changes in consumption and give a near-term outlook in the first of two-part web series. Register for free here.

BNSF Railway Company, CSX Transportation, Norfolk Southern Railway and Union Pacific Railroad must now submit additional information about their rail service recovery plans to the Surface Transportation Board (STB) after their initial submissions lacked the necessary level of detail. On May 6, the STB ordered the Class I railroads to submit service recovery plans to address service deficits. STB Chairman Martin Oberman said the plans “failed to instill confidence that the carriers have a serious approach to fixing a problem caused by their own lack of preparedness to respond to external shocks and fluctuations in demand, including especially short-sighted management of labor forces and other resources.” Read the full release here.

Containers depart Port of Duluth in historic shipment

/0 Comments/in

There was some positive shipping news out of Duluth last month when 200 containers of Chippewa Valley Bean kidney beans left the Port of Duluth-Superior bound for Europe.

It was the first shipment of containers out of the Lake Superior port since last fall’s announcement that it would be able to begin importing and exporting containers, becoming the second U.S. port on the Great Lakes-St. Lawrence Seaway, after Cleveland, with that capability.

The shipment also was significant because it represented a solution to the supply chain crisis that has congested west- and east-coast ports and caused delays in getting on-time shipments to overseas customers.

“This is really a saving grace for us,” said Cindy Brown, president of Chippewa Valley Bean, during a May 27 media event in Duluth.

The genesis for this particular shipping solution took place during the Transportation Go! conference, which was held March 3-4 in Milwaukee. There, attendees learned more about Duluth’s new container capacity, along with other opportunities for shipping on the St. Lawrence Seaway.

In an email, Brown, whose company joined SSGA after Transportation Go!, said: “We learned a lot at the Transportation Go! conference. We realized that there were opportunities on the Great Lakes, shipping first out of Cleveland and out of Duluth over the weekend. We also gained valuable contacts within the Surface Transportation Board. (We) were very pleased with the takeaways from the event. …

“The organization that connected all the dots for us was Nexyst360. We’ve worked with them for a couple of years on a closed-loop service with their containers. We intended to purchase containers this fall to ship raw kidney beans from growers’ fields to our plant. (They) listened to our shipping concerns and suggested that we buy the containers now and then helped us put the system together utilizing the port of Duluth.”

Nexyst360, also an SSGA member, is a supply chain solution company that provides “smart” shipping containers crafted to ensure quality, traceability, sustainability, market access and mobility.

Al Dutcher of Realm5, which recently acquired Nextyst360, said Transportation Go! was “a good catalyst” for the Duluth shipment.

“It was quite the team effort,” he said. “You had all the people there together, and that got the conversation going.”

Jonathan Lamb, president of Lake Superior Warehousing Co., which operates the Clure Terminal is partners with the Duluth Seaway Port Authority as Duluth Cargo Connect, said during the Duluth media event that signs point to more shippers using the Great Lakes for container shipping.

“There is a tremendous opportunity here,” said Lamb, who was a speaker during Transportation Go!, “The market is looking for alternatives in a world that has lots of challenges from the standpoint of logistics and supply chain.”

The goal of Transportation Go!  besides focusing on the Great Lakes and the St. Lawrence Seaway, was to connect ag shipping industry in the Upper Midwest and find real solutions to some of the supply chain problems that have plagued exporters over the last two years.

Plans for the 2023 Transportation Go! are underway. Look for an announcement of a date and location soon.

Read more: http://www.businessnorth.com/daily_briefing/maritime-container-cargo-makes-big-leap-in-duluth/article_077aa446-dde0-11ec-aec0-936571918280.html

https://www.duluthnewstribune.com/business/port-of-duluth-celebrates-historic-shipment

https://www.wpr.org/fed-supply-chain-delays-wisconsin-company-turns-twin-ports-shipping-service-move-goods

Transportation Roundup: Ships get bigger, ports get busier

/0 Comments/in

SSGA staff have compiled a roundup of current news in the container transportation industry. Click the links below to view the original stories.

Ships keep getting bigger and bigger and it’s not helping the supply chain woes, according to this Freightwaves writer. The size of the largest container ships has increased almost six times from 1981 to today and could be causing more harm than good. Read more here.

U.S. ports were busy in April, with several ports, including Long Beach and Houston, recording their busiest months in history. Los Angeles had its second-busiest April ever, handling 887,357 twenty-foot equivalent units (TEUs) and East and Gulf Coast ports showed an 18.7% gain. Maritime expert John McCown says the strong performance on these ports can be attributed to shippers rerouting cargo to avoid congestion in L.A. and Long Beach. Read more here from American Shipper.

And the ports are expected to be even more hectic with the summer shipping period nearing. A survey conducted by Container xChange found that 51% of its respondents of forwarders, traders and shippers expect the 2022 peak shipping season to be worse than 2021. Respondents identified China’s ongoing lockdowns, container availability, full warehouse, inflation, the Russia/Ukraine crisis and rising prices as the shipping industry’s biggest challenges. Container News writes more here.

On land, chassis providers continue to struggle handling the flow of containers on trains into Chicago rail ramps. But at rail ramps in Dallas, Memphis, Kansas City and St. Louis, conditions seem to be improving for chassis providers compared to a year ago. Read more from the Journal of Commerce here.

Transportation Roundup: Federal agencies requiring further reporting to improve ocean, rail shipping

/0 Comments/in

Following a two-day public hearing at the end of April, the Surface Transportation Board (STB) will require Class I railroads to submit reports on rail service, operations and employment. Four rail companies – BNSF Railway Co., CSX Transportation, Norfolk Southern Railway Co., and Union Pacific Railroad Co. – will also be required to submit service recovery plans, progress reports, historical data and participate in bi-weekly conference class with STB staff. The measures are intended to improve service issues and promote transparency, accountability and improvements. Read the full press release here.

The Federal Maritime Commission (FMC) will now require three major container alliances: 2M, Ocean and THE to submit more detailed pricing and capacity information to their Bureau of Trade Analysis (BTA). The information will help the agency assess ocean container behavior and market competitiveness. At SSGA’s Transportation Go! in early March, FMC chairman Daniel Maffei announced that the FMC audit team would be expanding its scope to get information from carriers about their handling of exports. Read the full press release here.

While appearing at a meeting of the National Shipper Advisory Committee (NSAC) FMC Commissioner Carl Bentzel proposed the agency to oversee rail demurrage on containers moving by a through bill of lading. The proposal would give FMC authority on demurrage matters on carrier haulage moves when the ocean carrier is responsible for door-to-door transportation, but not merchant haulage.

Intermodal rail has traditionally been overseen by the STB but Bentzel interprets shipping law to give the FMC authority over intermodal, meaning no formal FMC vote would be needed. NSAC has requested FMC provide greater oversight on intermodal for many months, especially with greater rail demurrage problems. Read more at the Journal of Commerce.