Seaport delays & congestion forecast to continue through 2022 (The Kiplinger Letter, Mar 24)
When it comes to moving goods by sea, there’s little hope for improvement in shipping delays or costs this year. The average time to deliver a shipping container, from a factory in China to clearing a U.S. port, is 109 days (vs. 40-50 days normally). Spot rates for transpacific shipments are about $9,500 for a 40-foot container. Small shippers in particular have little bargaining power. Carriers can quote a rate and say, “take it or leave it.” Capacity is that tight, even with more ships in service. In fact, there are reasons to fear shipping will get tighter: COVID-19 in China, which is trying to stamp out outbreaks with strict lockdowns that may hinder ports. A potential dockworker strike on the West Coast when the union’s contract expires July 1. Shippers are already trying to reroute to East Coast ports…not easy. The difficulty of getting empty containers where they are needed. Shipments by rail from Asia to Europe via Russia have been snarled due to Western sanctions. Trucking in the U.S. is a bright spot, sort of. Rates have eased as capacity slowly grows. But now, the rise in fuel surcharges is eating up those modest savings. All told, the odds seem tilted toward higher costs and longer delays.
Ed. Note: We see or hear very little that would contradict this bleak forecast! We also note that China, particularly Hong Kong and Shanghai, is struggling with a new surge of Omicron Covid, and we expect ports to have work slowdowns or stoppages and additional backlogs.
Lufthansa Cargo increases Airfreight Surcharge to 0.90 USD per kg
The sum of cost components in our airfreight surcharge has increased in the past weeks. Consequently, Lufthansa Cargo is increasing its Airfreight Surcharge, effective April 18, 2022, from 0.75 to 0.90 USD per kg chargeable freight weight. Please note, the AWB issue date, not the flight date, determines the applicable Airfreight Surcharge.
U.S. to ban all imports from Uyghur Autonomous Region (From Sandler Travis & Resenberg)
Under the Uyghur Forced Labor Prevention Act President Biden signed into law last Dec. 23, the U.S. will ban imports of all goods made in whole or in part from any good from the Xinjiang Uyghur Autonomous Region in China, effective June 21, 2022. Companies need to use the next 60 days to ensure their supply chains do not include such goods. The Uyghur Forced Labor Prevention Act effectively deems all goods mined, produced, or manufactured in the Xinjiang Uyghur Autonomous Region (XUAR) to be produced by forced labor in China. Even those not importing directly from China may have goods detained if the materials used to produce the imported goods in a second country are tied at any level to XUAR or specific entities or commodities associated with forced labor in China. For more info, please go to
CBP Issues UFLPA Advanced Notice of Known Importer Letters (From NCBFAA)
The Uyghur Forced Labor Prevention Act (UFLPA), which was signed into law Dec. 23, 2021, established a rebuttable presumption that the importation of any goods, wares, articles, and merchandise mined, produced, or manufactured wholly or in part in the Xinjiang Uyghur Autonomous Region of China, or produced by an entity on a list required by clause (i), (ii), (iv) or (v) of section 2(d)(2)(B) of the Act, is prohibited by Section 307 of the 1930 Tariff Act entry of these items into the U.S. This rebuttable presumption goes into effect June 21.
In advance of June 21, however, CBP will begin sending letters to importers identified as having previously imported merchandise that may be subject to the UFLPA to encourage them to address any forced labor issues in their supply chains within a timely manner.
CBP said that because an importer does not receive a letter does not mean its supply chain is free of forced labor. “All importers are expected to review their supply chains thoroughly and institute reliable measures to ensure imported goods are not produced wholly or in part with convict labor, forced labor, and/or indentured labor (including forced or indentured child labor),” the agency said.
Ed. Note: The “reasonable care” checklist on Customs’ website specifically states that importers must exercise reasonable care regarding forced labor in their supply chains. We urge you to carefully investigate and document your supply chains to insure you are in compliance.
West coast ports to start negotiations with ILWU in May
West coast terminal operators and ports will begin negotiations with ILWU on May 12 to replace/renew/extend their current contract, which expires July 1. Many shippers are already rerouting cargo to East Coast ports in anticipation of a work stoppage. We will keep you posted.
| Port of Savannah harbor deepening complete (From GPA) The Georgia Ports Authority, U.S. Army Corps of Engineers, Georgia Department of Transportation and dignitaries joined March 25 to mark completion of the Savannah Harbor deepening. The project expedites the flow of cargo to and from global destinations by reducing tidal restrictions for mega-ships transiting the Savannah River. Georgia exporters now have greater opportunity to move goods overseas, because ships can take on more cargo. Additionally, faster vessel service means the Port of Savannah can handle more ships each year. Buy American Requirements Tightened (From Sandler Travis & Rosenberg) The Biden administration has finalized a regulatory change that will increase U.S. content in the products purchased by the federal government and support domestic production of goods critical to U.S. economic and national security. This rule will take effect Oct. 25, 2022. For more info, please go to https://www.strtrade.com/trade-news-resources/str-trade-report/trade-report/march/buy-american-requirements-tightened?mkt_tok=NzIzLVdPWi00NDYAAAGDlr8i0rEsL_F2PSTq8CfAuGmlglX5je3iXSJvbmo4T-L0ItqqY86n9Dv95Ueku8mJ3hkg8yDpdEIeOjfZ5J57_NHricSzNFHfV7jNC6k |