<div class="phx-topic abstract-wrapper">The assessment of storage fees inside a terminal creates competitive pressures among marine terminal operators, their container line customers, and the importers that contract with container lines.</div>

The assessment of storage fees inside a terminal creates competitive pressures among marine terminal operators, their container line customers, and the importers that contract with container lines.

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<div>The manner in which ocean carriers and marine terminals assess fees to importers for containers that dwell at port yards beyond contractual free time is a window into a muddled situation that the US Federal Maritime Commission (FMC) has two months to sort out. The complexities are coming to bear on a rulemaking process the FMC must complete by mid-June due to a provision within the Ocean Shipping Reform Act of 2022 that was signed into law last June by President Joe Biden and stipulates the agency must address the billing of detention and demurrage fees within one year. Demurrage...

The manner in which ocean carriers and marine terminals assess fees to importers for containers that dwell at port yards beyond contractual free time is a window into a muddled situation that the US Federal Maritime Commission (FMC) has two months to sort out. The complexities are coming to bear on a rulemaking process the FMC must complete by mid-June due to a provision within the Ocean Shipping Reform Act of 2022 that was signed into law last June by President Joe Biden and stipulates the agency must address the billing of detention and demurrage fees within one year. Demurrage is a fee assessed by terminal operators on loaded import containers that stay in port beyond allowable free time specified by a carrier-shipper contract or port free time tariff. In advance of the FMC concluding its rulemaking process, a handful of container lines have announced in recent weeks they have stopped charging importers, or consignees, demurrage fees on days when terminals are closed. But that only clouds the invoicing picture because, from the perspective of marine terminal operators (MTOs), storage fees will accumulate whether or not a terminal’s gates are open to truckers. Contract complexity An example of the complexity the rulemaking must address: The Port of Long Beach’s tariff gives consignees seven days of free time, a clock that generally starts at 3 am the day after a container is discharged from a vessel. That seven-day period includes days when a terminal is closed for weekends and holidays. Meanwhile, a container line that calls at a terminal in Long Beach can separately agree to a contract with a consignee that gives the cargo owner’s container additional free time in the terminal beyond what’s specified in the port tariff. That, in turn, creates a set of competitive pressures on various parties attached to the shipment in a so-called merchant haulage move, where the consignee is responsible for arranging the pickup and return of the container. The container line is the customer of the MTO, while the consignee is both the customer of the container line and the drayage provider it has nominated to pick up and return the container. The MTO is the party that collects fees, generally from its container line customer, when a container exceeds free time according to the port’s tariff. But the MTO has no contractual relationship with either the consignee or the drayage carrier, and it won’t allow a container to be discharged from a terminal until demurrage has been paid. In Southern California, terminals do not bill the shippers directly for demurrage due, but rather post what’s due on their website, said Ian Weiland, COO of drayage provider Junction Collaborative Transports. “The terminal doesn’t care who pays, but someone needs to pay it to retrieve the container,” Weiland said. That exact sentiment was echoed by Michael Kroul, managing director at drayage broker KTI. “Most of the time, the [dray] carrier pays and gets the amount paid back by the [beneficial cargo owner],” Kroul said. Terminals still ‘get paid’ The way terminals ensure they get paid for extra days of container storage is important, because the FMC said it is weighing whether to specify that the consignee on the bill of lading is the party to which demurrage should be billed. The complexity is that the consignee on the bill of lading has a contract with the container line, not the MTO, and if the container line is voiding demurrage charges on behalf of its customers for days a terminal isn’t open, someone still needs to pay. “We do not eat those extra days in storage fees,” said one Southern California terminal executive who did not want to be identified. “I’m not sure what the carrier is doing directly with the BCO, but we get paid per our tariff.” That is but one permutation of a process that is slightly different at each US port, including ones run as landlord ports — where private MTOs lease and run individual terminals — and operating ports, where the port authority also acts as the operator. Free time varies among ports, and there is no uniformity on free time clauses in contracts between container lines and importers. Fees as a way to incentivize cargo movement To underscore the potentially fraught nature of demurrage billing, the National Association of Waterfront Employers (NAWE) shared with the Journal of Commerce a list of data points that impact importer delays in retrieving cargo where MTOs lack insight. The list includes: the importer’s inland warehouse capacity and hours of operation; availability of chassis; availability of drayage capacity; the amount of free time agreed between the container line and importer; whether the ocean carrier’s performance caused or contributed to the importer’s delay in retrieving cargo; the underlying cause of any customs holds; and the existence of any disputes between the ocean carrier and importer. The NAWE’s implication is that, without insight to those data points, charging terminal storage fees is the best way to incentivize cargo retrieval. “Not only do we not even have a contractual relationship with the shipper, our agreements are with the carrier,” NAWE President Robert Murray told the Journal of Commerce in an interview. “But then on top of that, having to provide [invoice] data points that either don't exist or that we don't have, that's extremely burdensome. You've got some carriers that are already taking action , you have others that are not. That's uncertainty and it really isn't good for the marketplace.” Teri Errico Griffis contributed to this report. Contact Eric Johnson at eric.johnson@spglobal.com and follow him on Twitter: @LogTechEric .

Container Shipping News

Port News

Container lines

North American ports

Transport, Trade and Regulation News

Demurrage invoicing complications cloud FMC’s free time rulemaking process

<div class="phx-topic abstract-wrapper">The February launch date coincides with the start of services by the Premier Alliance formed by ONE, HMM and Yang Ming.</div>

The February launch date coincides with the start of services by the Premier Alliance formed by ONE, HMM and Yang Ming.

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<div class="phx-topic">Wan Hai Lines is planning to expand its trans-Pacific network after agreeing to a slot exchange deal with Ocean Network Express (ONE) on the latter’s Pacific South 6 service linking China with Long Beach and Oakland, the Taiwanese carrier said. The slot exchange will begin in February. The launch date coincides with the start of services by the Premier Alliance formed by ONE, HMM and Yang Ming Marine Transport to replace THE Alliance following the departure of Hapag-Lloyd to join Maersk in the Gemini Cooperation. While the launch of the Premier Alliance is now in abeyance after the <a href="https://www.joc.com/article/fmc-halts-premier-alliance-start-for-more-information-5877293">US Federal Maritime Commission’s (FMC’s) announcement Friday</a> that it will stop the partnership from going ahead while it seeks further information to assess the competitive impact, the three carriers can continue their THE Alliance group. The FMC’s agreement with THE Alliance does not expire until April 1, 2030, FMC documents show. The port rotation given by Wan Hai reflects ONE’s existing PS6 service with calls at Shanghai-Ningbo-Long Beach-Oakland-Shanghai-Ningbo. Wan Hai said the PS6 service will “provide a direct connection from Asia to the US West Coast,” with an express 16- to 18-day transit from Shanghai to Southern California. It will augment Wan Hai’s two existing services — its trans-Pacific West Coast AP1 service and its around-the-world US East Coast-Asia-America 7 service. Due to the new PS6 loop, Wan Hai said it will amend the rotation of its AP1 service by dropping Shanghai and Ningbo beginning in February to improve transit times for customers in Vietnam, Taiwan and southern China. The new rotation will be Haiphong-Cai Mep (Vietnam)-Shekou-Xiamen-Taipei-Los Angeles-Oakland-Shekou-Haiphong. Both the PS6 slot exchange and AP1 service changes are part of Wan Hai’s 2025 trans-Pacific service improvements. The carrier has been deriving an increasing share of revenue from its US services. Revenues from Wan Hai’s US trade more than doubled to $560 million in the first half of this year from the year-ago period. The US market contributed 28% of the carrier’s $2 billion in overall first-half revenues against 16% of the $1.5 billion in revenue generated in the prior-year period. US volumes showed only modest growth to 11% of total liftings in the first half, from 10% in the first six months of last year. Contact Keith Wallis at <a href="mailto:keithwallis@hotmail.com">keithwallis@hotmail.com</a>. </div>

Wan Hai Lines is planning to expand its trans-Pacific network after agreeing to a slot exchange deal with Ocean Network Express (ONE) on the latter’s Pacific South 6 service linking China with Long Beach and Oakland, the Taiwanese carrier said. The slot exchange will begin in February. The launch date coincides with the start of services by the Premier Alliance formed by ONE, HMM and Yang Ming Marine Transport to replace THE Alliance following the departure of Hapag-Lloyd to join Maersk in the Gemini Cooperation. While the launch of the Premier Alliance is now in abeyance after the US Federal Maritime Commission’s (FMC’s) announcement Friday that it will stop the partnership from going ahead while it seeks further information to assess the competitive impact, the three carriers can continue their THE Alliance group. The FMC’s agreement with THE Alliance does not expire until April 1, 2030, FMC documents show. The port rotation given by Wan Hai reflects ONE’s existing PS6 service with calls at Shanghai-Ningbo-Long Beach-Oakland-Shanghai-Ningbo. Wan Hai said the PS6 service will “provide a direct connection from Asia to the US West Coast,” with an express 16- to 18-day transit from Shanghai to Southern California. It will augment Wan Hai’s two existing services — its trans-Pacific West Coast AP1 service and its around-the-world US East Coast-Asia-America 7 service. Due to the new PS6 loop, Wan Hai said it will amend the rotation of its AP1 service by dropping Shanghai and Ningbo beginning in February to improve transit times for customers in Vietnam, Taiwan and southern China. The new rotation will be Haiphong-Cai Mep (Vietnam)-Shekou-Xiamen-Taipei-Los Angeles-Oakland-Shekou-Haiphong. Both the PS6 slot exchange and AP1 service changes are part of Wan Hai’s 2025 trans-Pacific service improvements. The carrier has been deriving an increasing share of revenue from its US services. Revenues from Wan Hai’s US trade more than doubled to $560 million in the first half of this year from the year-ago period. The US market contributed 28% of the carrier’s $2 billion in overall first-half revenues against 16% of the $1.5 billion in revenue generated in the prior-year period. US volumes showed only modest growth to 11% of total liftings in the first half, from 10% in the first six months of last year. Contact Keith Wallis at keithwallis@hotmail.com .

Trans-Pacific

Maritime

Wan Hai to expand US trans-Pacific services with ONE slot charter deal

<div class="phx-topic abstract-wrapper">While carriers can offset some operating costs by raising rate levels, reducing carbon emissions on voyages that are taking two weeks longer is becoming increasingly important as decarbonization regulations tighten.</div>

While carriers can offset some operating costs by raising rate levels, reducing carbon emissions on voyages that are taking two weeks longer is becoming increasingly important as decarbonization regulations tighten.

<div class="phx-topic">Container shipping is sailing into its second year of diverting around southern Africa, and with no sign of stability returning to the Red Sea — or the Middle East in general — carriers and their customers are facing up to another year of disruption and tight capacity. The longer voyages are raising carrier operating costs and absorbing all available capacity, as well as increasing greenhouse gas emissions even as regulatory pressure builds on carriers to reduce them. At the same time, shippers are having to factor longer transit times and large rate increases into their annual Asia-Europe contracts. Those market complexities were highlighted by Hapag-Lloyd CEO Rolf Habben Jansen, who told customers during a briefing Monday that the higher costs of sailing around the Cape of Good Hope was influencing 2025 annual contracts. “Asia-Europe contracts are being closed on average at significantly higher rates than we saw last year, which is logical as most of those contracts were closed prior to the Red Sea situation,” he said. The rising long-term rate increases are not yet being reflected by the indices, but global bank HSBC noted in a recent market report that it is expecting to see “a significant step-up in contract rates in 2025 compared to 2024.” <div class="wrapper-narrow"><dynamic-object type="jocchartid" resource-id="ef167537-108b-4e1b-ac11-43e99f815839"></dynamic-object></div>Long-term rates between China and North Europe have remained near $2,900 per FEU since early October in contrast with the average spot rate that has risen by more than $1,500 per FEU over the same period, according to rate benchmarking platform Xeneta. Data from Platts, a sister company of the Journal of Commerce within S&amp;P Global, shows average spot rates from Asia to North Europe easing last week, falling $200 to settle at $5,000 per FEU on Dec. 6. Spot rates from Asia to the Mediterranean remained unchanged at $5,400/FEU. <h3>Decarbonization pressure builds </h3>While carriers can offset some operating costs by raising rate levels, reducing carbon emissions on voyages that are taking two weeks longer is becoming increasingly important as decarbonization regulations tighten. In 2025, compliance with <a href="https://www.joc.com/article/european-parliament-approves-shipping-ets-but-stakeholders-wary-5202492">Europe’s emissions trading system (ETS)</a> will see carriers being taxed on 70% of their carbon emissions, up from 40% this year. From 2026 onward, 100% of carbon emissions will be taxed. The rise in ETS surcharges will come on top of the new fuel intensity regulation <a href="https://www.joc.com/article/container-carriers-to-shoulder-bulk-of-europe-fuel-intensity-rule-5192246">FuelEU Maritime</a> that from Jan. 1 will force carriers to increase their use of more costly lower-emission fuels. The impact on carriers’ carbon footprint in the third quarter of this year was captured by the Xeneta and Marine Benchmark Carbon Emissions Index (CEI) that measures emissions across Xeneta’s top 13 ocean container shipping trades. The index hit 107.9 points in the third quarter, the highest on record and up 12.2% from a year ago before the Red Sea crisis. “We will all have to reduce emissions, and because the availability of green fuels is limited, I do expect that between now and 2030 we will have to find ways to make our network more efficient and to slow ships down,” Habben Jansen told the Hapag-Lloyd customer briefing. He said that slowing down would have “a massive impact” on reducing emissions, noting an industry-wide slowdown of ships by 3 knots would cut the current overall container shipping fleet emissions by more than 20%. Sea-Intelligence Maritime Analysis noted in its Sunday Spotlight newsletter that from January to October, the average global sailing distance of a container had increased 17.4% compared with a transit where the Suez routing would have been used. Carriers are deploying all the capacity they can find to offset the tonnage being absorbed by the longer transit times, with the average idle fleet at just 0.7% of the total global fleet for much of the year, Sea-Intelligence said in its newsletter. ”Once the idle fleet gets below roughly 2%, the rate becomes more volatile, and once we cross a threshold of roughly 1% idle vessels, the volatility becomes extreme,” the analyst noted. Contact Greg Knowler at <a href="mailto:greg.knowler@spglobal.com">greg.knowler@spglobal.com.</a></div>

Container shipping is sailing into its second year of diverting around southern Africa, and with no sign of stability returning to the Red Sea — or the Middle East in general — carriers and their customers are facing up to another year of disruption and tight capacity. The longer voyages are raising carrier operating costs and absorbing all available capacity, as well as increasing greenhouse gas emissions even as regulatory pressure builds on carriers to reduce them. At the same time, shippers are having to factor longer transit times and large rate increases into their annual Asia-Europe contracts. Those market complexities were highlighted by Hapag-Lloyd CEO Rolf Habben Jansen, who told customers during a briefing Monday that the higher costs of sailing around the Cape of Good Hope was influencing 2025 annual contracts. “Asia-Europe contracts are being closed on average at significantly higher rates than we saw last year, which is logical as most of those contracts were closed prior to the Red Sea situation,” he said. The rising long-term rate increases are not yet being reflected by the indices, but global bank HSBC noted in a recent market report that it is expecting to see “a significant step-up in contract rates in 2025 compared to 2024.” Long-term rates between China and North Europe have remained near $2,900 per FEU since early October in contrast with the average spot rate that has risen by more than $1,500 per FEU over the same period, according to rate benchmarking platform Xeneta. Data from Platts, a sister company of the Journal of Commerce within S&P Global, shows average spot rates from Asia to North Europe easing last week, falling $200 to settle at $5,000 per FEU on Dec. 6. Spot rates from Asia to the Mediterranean remained unchanged at $5,400/FEU. Decarbonization pressure builds While carriers can offset some operating costs by raising rate levels, reducing carbon emissions on voyages that are taking two weeks longer is becoming increasingly important as decarbonization regulations tighten. In 2025, compliance with Europe’s emissions trading system (ETS) will see carriers being taxed on 70% of their carbon emissions, up from 40% this year. From 2026 onward, 100% of carbon emissions will be taxed. The rise in ETS surcharges will come on top of the new fuel intensity regulation FuelEU Maritime that from Jan. 1 will force carriers to increase their use of more costly lower-emission fuels. The impact on carriers’ carbon footprint in the third quarter of this year was captured by the Xeneta and Marine Benchmark Carbon Emissions Index (CEI) that measures emissions across Xeneta’s top 13 ocean container shipping trades. The index hit 107.9 points in the third quarter, the highest on record and up 12.2% from a year ago before the Red Sea crisis. “We will all have to reduce emissions, and because the availability of green fuels is limited, I do expect that between now and 2030 we will have to find ways to make our network more efficient and to slow ships down,” Habben Jansen told the Hapag-Lloyd customer briefing. He said that slowing down would have “a massive impact” on reducing emissions, noting an industry-wide slowdown of ships by 3 knots would cut the current overall container shipping fleet emissions by more than 20%. Sea-Intelligence Maritime Analysis noted in its Sunday Spotlight newsletter that from January to October, the average global sailing distance of a container had increased 17.4% compared with a transit where the Suez routing would have been used. Carriers are deploying all the capacity they can find to offset the tonnage being absorbed by the longer transit times, with the average idle fleet at just 0.7% of the total global fleet for much of the year, Sea-Intelligence said in its newsletter. ”Once the idle fleet gets below roughly 2%, the rate becomes more volatile, and once we cross a threshold of roughly 1% idle vessels, the volatility becomes extreme,” the analyst noted. Contact Greg Knowler at greg.knowler@spglobal.com.

Asia-Europe

Ongoing Red Sea effect reaches deep into Asia-Europe trade lane

<div class="phx-topic abstract-wrapper">A growing need to replace aging US hydropower units adds weight to project demand from the renewable energy sector.</div>

A growing need to replace aging US hydropower units adds weight to project demand from the renewable energy sector.

<div class="phx-topic">Efforts to restore aging hydropower facilities across the US have been part of an uptick in project activity, helping feed the growing renewable energy segment driving breakbulk and project cargo demand.The latest hydro project news came Dec. 2, when renewable energy equipment manufacturer GE Vernova announced a deal with Dominion Energy to modernize two of the five hydropower units at the nearly 100-year-old Saluda Hydro power plant, which Dominion operates in South Carolina. The first unit is expected to be retrofitted by 2027. Dominion Energy South Carolina spokesperson Matt Long told the Journal of Commerce that Dominion is making major upgrades to the Saluda units to ensure their long-term reliability and operations.The upgrades are part of a multi-year restoration effort Dominion is working on at the 203-MW Saluda plant, as well as a piece of Dominion’s overall hydropower strategy. Including the Saluda plant, Dominion operates nine hydroelectric facilities across its territories in Virginia, North Carolina and South Carolina. According to Dominion’s latest annual report, hydro accounted for 5%-11% of its energy supply sources in those territories. “Hydropower will continue to play a key role in Dominion Energy’s increasingly clean energy portfolio,” Long said.<h3>Renewed interest in hydro</h3>US hydropower generation is on track to rise by 6% in 2024 after falling last year to its lowest level since 2001, according to an April analysis by the US Energy Information Administration (EIA). Growth is expected in nearly every part of the country, with the largest hydropower increases coming in the Southeast, Northwest and the Rockies.Hydropower accounts for about 27% of total US renewable electricity generated in the United States and nearly 6% of total US electricity, according to the US Department of Energy (DOE). Defined as the production of electricity through the force of moving water — often when released through a dam or reservoir — hydropower is a centuries-old method used to generate power. But in recent years, hydro has garnered interest as a renewable energy solution, alongside wind, solar, nuclear, geothermal and biomass resources.Part of that solution entails updating the US’ aging hydropower infrastructure, as several facilities are over a century old and surpassing their lifespan of 50 to 100 years. But there are also new hydro facilities in development, including four proposed projects in rural Alaska and Washington State that received $76 million in federal funding in February.Under President Joe Biden’s administration, the Infrastructure Investment and Jobs Act carved out $553.6 million for projects to maintain and enhance existing hydroelectric facilities. Along with ensuring the facilities will continue to provide electricity, the funding would also enable hydro plants to integrate renewable energy sources including wind and solar. In September, the DOE selected 293 hydroelectric projects across 33 states to receive up to $430 million in incentives to upgrade existing facilities. A second round of program funding will be announced in 2025.<h3>Supply chain limitations</h3>The modernization of existing hydropower facilities, along with new construction, could drive expansion of domestic manufacturing and foreign investments in the US hydropower supply chain, according to the DOE.But there are vulnerabilities that the supply chain will need to overcome. “Severely limited or nonexistent domestic suppliers,” unpredictable demand signals, and “inequitable” foreign competition were identified as major gaps in the domestic hydropower supply chain in an August 2024 analysis by the DOE. About half of hydropower facilities are federally owned, with the other half split between public and private entities, according to the National Hydropower Association.There are indications that federal support for US hydropower development could continue under the administration of President-elect Donald Trump, although it’s unclear what that might look like. Whereas Trump has fiercely opposed offshore wind as a solution to meet US energy needs, he has advocated for advancing hydropower as a renewable energy resource. Trump’s campaign agenda indicated that the president-elect “will champion America’s great dams and hydroelectric power,” although did not provide specific plans.Contact Autumn Cafiero Giusti at <a href="mailto:autumn@autumngiusti.com">autumn@autumngiusti.com</a>.</div>

Efforts to restore aging hydropower facilities across the US have been part of an uptick in project activity, helping feed the growing renewable energy segment driving breakbulk and project cargo demand. The latest hydro project news came Dec. 2, when renewable energy equipment manufacturer GE Vernova announced a deal with Dominion Energy to modernize two of the five hydropower units at the nearly 100-year-old Saluda Hydro power plant, which Dominion operates in South Carolina. The first unit is expected to be retrofitted by 2027. Dominion Energy South Carolina spokesperson Matt Long told the Journal of Commerce that Dominion is making major upgrades to the Saluda units to ensure their long-term reliability and operations. The upgrades are part of a multi-year restoration effort Dominion is working on at the 203-MW Saluda plant, as well as a piece of Dominion’s overall hydropower strategy. Including the Saluda plant, Dominion operates nine hydroelectric facilities across its territories in Virginia, North Carolina and South Carolina. According to Dominion’s latest annual report, hydro accounted for 5%-11% of its energy supply sources in those territories. “Hydropower will continue to play a key role in Dominion Energy’s increasingly clean energy portfolio,” Long said. Renewed interest in hydro US hydropower generation is on track to rise by 6% in 2024 after falling last year to its lowest level since 2001, according to an April analysis by the US Energy Information Administration (EIA). Growth is expected in nearly every part of the country, with the largest hydropower increases coming in the Southeast, Northwest and the Rockies. Hydropower accounts for about 27% of total US renewable electricity generated in the United States and nearly 6% of total US electricity, according to the US Department of Energy (DOE). Defined as the production of electricity through the force of moving water — often when released through a dam or reservoir — hydropower is a centuries-old method used to generate power. But in recent years, hydro has garnered interest as a renewable energy solution, alongside wind, solar, nuclear, geothermal and biomass resources. Part of that solution entails updating the US’ aging hydropower infrastructure, as several facilities are over a century old and surpassing their lifespan of 50 to 100 years. But there are also new hydro facilities in development, including four proposed projects in rural Alaska and Washington State that received $76 million in federal funding in February. Under President Joe Biden’s administration, the Infrastructure Investment and Jobs Act carved out $553.6 million for projects to maintain and enhance existing hydroelectric facilities. Along with ensuring the facilities will continue to provide electricity, the funding would also enable hydro plants to integrate renewable energy sources including wind and solar. In September, the DOE selected 293 hydroelectric projects across 33 states to receive up to $430 million in incentives to upgrade existing facilities. A second round of program funding will be announced in 2025. Supply chain limitations The modernization of existing hydropower facilities, along with new construction, could drive expansion of domestic manufacturing and foreign investments in the US hydropower supply chain, according to the DOE. But there are vulnerabilities that the supply chain will need to overcome. “Severely limited or nonexistent domestic suppliers,” unpredictable demand signals, and “inequitable” foreign competition were identified as major gaps in the domestic hydropower supply chain in an August 2024 analysis by the DOE. About half of hydropower facilities are federally owned, with the other half split between public and private entities, according to the National Hydropower Association. There are indications that federal support for US hydropower development could continue under the administration of President-elect Donald Trump, although it’s unclear what that might look like. Whereas Trump has fiercely opposed offshore wind as a solution to meet US energy needs, he has advocated for advancing hydropower as a renewable energy resource. Trump’s campaign agenda indicated that the president-elect “will champion America’s great dams and hydroelectric power,” although did not provide specific plans. Contact Autumn Cafiero Giusti at autumn@autumngiusti.com .

Energy projects

Project cargo

Breakbulk News

US hydropower restoration projects offer stimulus for project cargo demand

<div class="phx-topic abstract-wrapper">Industrial projects reliant on imported steel are expected to feel the pinch of an import and quality crackdown in the country.</div>

Industrial projects reliant on imported steel are expected to feel the pinch of an import and quality crackdown in the country.

<div class="phx-topic">Breakbulk imports into India have been disrupted by the double whammy of a clampdown on inbound steel trade and more stringent quality requirements, with concerns of a knock-on effect on industrial projects.Steel products make up a significant portion of Indian breakbulk trade, and volume fluctuations directly impact marine terminals equipped with multipurpose berths. Smaller steel lots are also shipped in containers, contributing incremental traffic for liner calls and box terminals. Importers told the Journal of Commerce they faced considerable customs clearance delays for steel consignments landed at various Indian docks through October, with officials unwilling to issue the mandatory quality approval or a “no objection certificate” (NOC) due to a lack of clarity over the policy. Following the release of updated guidelines in late November, most stranded cargoes have been flushed out, but not without consignees incurring substantial additional port charges, including ground rent and storage fees, sources said. The policy change is said to be an outcome of hard lobbying from local steelmakers, who were pushing policymakers to curb the influx of cheap imports flooding the Indian market. India’s steel imports surged 41% year over year in the first half of fiscal year 2024–25 (April–September), according to India Ministry of Steel data.While welcoming government measures to safeguard domestic interests, industry sources said protectionist sentiment could negatively impact the nascent steel sector, a segment critical to an Indian economy seeking sustained growth. <h3>EPCs, forwarders count cost of trade curbs</h3>“India's contemplation of a 25% import duty on steel … could have significant implications for micro small-to-medium enterprises that rely on steel as a key raw material,” Ajay Sahai, director general at the Federation of Indian Export Organizations, told the Journal of Commerce. “The government must strike a workable balance between the two sides.”A supply chain expert with knowledge of steel industry dynamics said stricter norms and a possible 25% safeguard duty on India’s steel imports “will drastically strain steel supply.”“It’s not that India is highly dependent on imports, but it’s the availability of low-priced imported steel that drives the supply side,” the source said. Sources also highlighted the significance of steel-consuming sectors such as engineering, automobile and construction for the national flagship “Make-in-India” program. “All of this [politics] is creating a lot of uncertainty, which has significant repercussions for everyone in the steel supply chain,” another industry analyst told the Journal of Commerce. “It’s just not helping the market.” Local freight forwarders in India active in the steel trade also raised concerns over the regulatory complexities and the potential business impact. “Online data uploading on the steel import monitoring system [SIM], a prerequisite to clearance, is now the importer’s responsibility, which is painful and adds costs,” said Manoj Subramanian, senior general manager of corporate sales at Mumbai-based Flyjac Logistics. “The strain could affect various ongoing infrastructure projects, including metro and bullet rail developments, and if the stalemate continues, projects lined up in the renewable energy sector will also likely take a hit.” Contact Bency Matthew at <a href="mailto:bencymathew@gmail.com">bencymathew@gmail.com</a>.</div>

Breakbulk imports into India have been disrupted by the double whammy of a clampdown on inbound steel trade and more stringent quality requirements, with concerns of a knock-on effect on industrial projects. Steel products make up a significant portion of Indian breakbulk trade, and volume fluctuations directly impact marine terminals equipped with multipurpose berths. Smaller steel lots are also shipped in containers, contributing incremental traffic for liner calls and box terminals. Importers told the Journal of Commerce they faced considerable customs clearance delays for steel consignments landed at various Indian docks through October, with officials unwilling to issue the mandatory quality approval or a “no objection certificate” (NOC) due to a lack of clarity over the policy. Following the release of updated guidelines in late November, most stranded cargoes have been flushed out, but not without consignees incurring substantial additional port charges, including ground rent and storage fees, sources said. The policy change is said to be an outcome of hard lobbying from local steelmakers, who were pushing policymakers to curb the influx of cheap imports flooding the Indian market. India’s steel imports surged 41% year over year in the first half of fiscal year 2024–25 (April–September), according to India Ministry of Steel data. While welcoming government measures to safeguard domestic interests, industry sources said protectionist sentiment could negatively impact the nascent steel sector, a segment critical to an Indian economy seeking sustained growth. EPCs, forwarders count cost of trade curbs “India's contemplation of a 25% import duty on steel … could have significant implications for micro small-to-medium enterprises that rely on steel as a key raw material,” Ajay Sahai, director general at the Federation of Indian Export Organizations, told the Journal of Commerce. “The government must strike a workable balance between the two sides.” A supply chain expert with knowledge of steel industry dynamics said stricter norms and a possible 25% safeguard duty on India’s steel imports “will drastically strain steel supply.” “It’s not that India is highly dependent on imports, but it’s the availability of low-priced imported steel that drives the supply side,” the source said. Sources also highlighted the significance of steel-consuming sectors such as engineering, automobile and construction for the national flagship “Make-in-India” program. “All of this [politics] is creating a lot of uncertainty, which has significant repercussions for everyone in the steel supply chain,” another industry analyst told the Journal of Commerce. “It’s just not helping the market.” Local freight forwarders in India active in the steel trade also raised concerns over the regulatory complexities and the potential business impact. “Online data uploading on the steel import monitoring system [SIM], a prerequisite to clearance, is now the importer’s responsibility, which is painful and adds costs,” said Manoj Subramanian, senior general manager of corporate sales at Mumbai-based Flyjac Logistics. “The strain could affect various ongoing infrastructure projects, including metro and bullet rail developments, and if the stalemate continues, projects lined up in the renewable energy sector will also likely take a hit.” Contact Bency Matthew at bencymathew@gmail.com .

Breakbulk carriers

Breakbulk ports

Breakbulk trade stymied by India’s steel import curbs

<div class="phx-topic abstract-wrapper">The Federal Maritime Commission said that it needs more information about the new grouping of ocean carriers known as the Premier Alliance before the vessel-sharing agreement can begin in February on US trades. </div>

The Federal Maritime Commission said that it needs more information about the new grouping of ocean carriers known as the Premier Alliance before the vessel-sharing agreement can begin in February on US trades.

<div class="phx-topic">The Federal Maritime Commission (FMC) on Friday has halted Premier Alliance from becoming effective next week as scheduled, citing insufficient information on the alliance set to sail in February. The FMC said the proposed agreement from Ocean Network Express, HMM and Yang Ming “lacks sufficient detail to allow for a complete analysis of potential competitive impacts and whether the agreement fully complies with all statutory requirements.” The Premier Alliance on Friday released details of its <a href="https://www.joc.com/article/north-america-trade-to-dominate-premier-alliances-network-launch-in-february-5877233">new network</a>. Premier members had been partners in the THE Alliance with Hapag-Lloyd. But with Hapag-Lloyd’s decision to bolt THE Alliance in favor of joining Maersk in the 2M Cooperation, the three carriers <a href="https://www.joc.com/article/msc-strikes-asia-europe-slot-share-with-former-thea-members-5723585">banded together</a> in September under a new name and with a slot-sharing agreement in the trans-Pacific trade with Mediterranean Shipping Co. The FMC has a 45-day window from when it collects the information to issue the formal go-ahead for the Premier Alliance, and any shippers wishing to weigh in will be able to do so during a 15-day window that starts next week. Such requests for additional information from the FMC are common, with the Gemini Cooperation <a href="https://www.joc.com/article/fmc-wants-maersk-hapag-lloyd-to-provide-more-details-on-gemini-alliance-5192298">itself having received</a> one in July. The agency later determined there were no competitive impacts to Gemini but vowed to keep <a href="https://www.joc.com/article/fmc-wont-block-gemini-alliance-but-vows-tight-monitoring-5724939">an eye</a> on the new alliance. Contact Michael Angell at <a href="mailto:michael.angell@spglobal.com ">michael.angell@spglobal.com</a>. </div>

The Federal Maritime Commission (FMC) on Friday has halted Premier Alliance from becoming effective next week as scheduled, citing insufficient information on the alliance set to sail in February. The FMC said the proposed agreement from Ocean Network Express, HMM and Yang Ming “lacks sufficient detail to allow for a complete analysis of potential competitive impacts and whether the agreement fully complies with all statutory requirements.” The Premier Alliance on Friday released details of its new network . Premier members had been partners in the THE Alliance with Hapag-Lloyd. But with Hapag-Lloyd’s decision to bolt THE Alliance in favor of joining Maersk in the 2M Cooperation, the three carriers banded together in September under a new name and with a slot-sharing agreement in the trans-Pacific trade with Mediterranean Shipping Co. The FMC has a 45-day window from when it collects the information to issue the formal go-ahead for the Premier Alliance, and any shippers wishing to weigh in will be able to do so during a 15-day window that starts next week. Such requests for additional information from the FMC are common, with the Gemini Cooperation itself having received one in July. The agency later determined there were no competitive impacts to Gemini but vowed to keep an eye on the new alliance. Contact Michael Angell at michael.angell@spglobal.com .

FMC halts Premier Alliance start for more information

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The world of LTL is slow to embrace change. Business anachronisms permeate current supply chain processes. These vestiges of the way things used to work define the LTL freight transportation procurement process of many modern shippers.David Knuth, logistics specialist at IEWC, a global supplier of cable and wire based in Wisconsin, is happy to have modernized the RFP process, automating the entire LTL bidding procedure with Bid$ense, SMC³’s automated truckload and LTL freight transportation sourcing solution. But when prompted, he can still recall what once was.In his previous job, a large part of his duties were consumed by creating an intermodal bid package for carriers. In a spreadsheet, Knuth detailed the company’s volumes lane by lane, taking care to delete any errant keystrokes or misleading data. He would then email out the information to each carrier, taking time to respond to detailed technical questions about the spreadsheet data. Finally, he had to compile all the results, create an algorithm that would compare the carriers on each lane, and award the business.“It was a huge undertaking. It took about four months to do,” Knuth said of the old process. “It was almost a full-time job for that part of the year, every year.”In his new job at IEWC, he sat down with Bid$ense on day one and was amazed at the capabilities. Knuth had never before used a bid tool. SMC³’s latest versions of Bid$ense automate the process even further, taking truckload and LTL RFPs entirely online. The tool draws on RFP best-practices protocols to streamline the bidding communication process, enabling bidding carriers to respond accurately and promptly to shipper requests. The solution also does all the distribution work automatically, electronically submitting shipper bid data to carriers based on their actual service capabilities and performance records. Carriers are alerted with timely prompts for RFP deliverables, so shippers aren’t waiting by the phone for responses.Another benefit of automating the process is the data-cleansing assistance. When Knuth sent spreadsheets to carriers, data errors might cloud the bidding process; he might have to resend data or simply accept a price that did not truly reflect the costs of doing business. Data cleansing is incredibly beneficial, he said.The spreadsheet technique also made bidding analysis an onerous task. Since Bid$ense automates and streamlines the entire RFP process, intensive examination is now simple. SMC³ knows that each bid has more than one best outcome. With uniform responses from each carrier, shippers can quickly rank results and create an unlimited quantity of what-if scenarios to make the optimal procurement decision.Jesse Burnett of Central Garden &amp; Pet experiences many of the same benefits. Founded in 1980, Central Garden &amp; Pet has spent the last three decades growing from a small garden supply company to a provider of a range of products from dog chews and bird seed to soil supplements and natural insecticides. For much of its life, the company shipped these disparate goods via LTL and truckload carriers to retailers throughout the country, relying on each business unit to negotiate directly with their freight transportation providers. This arrangement worked fairly well for a small company, but as Central Garden &amp; Pet expanded, leadership decided to consolidate decision making.Burnett helped centralize the transportation decision making in 2015 with SMC³’s Bid$ense. Before Bid$ense, every business unit operated independently as far as negotiating with carriers.“There were a lot of different things just floating around,” he said. “We didn’t have master agreements in place; no national pricing at all. The pricing from carriers was just all over the place, depending on where you were.”The transformations he saw with Bid$ense were immediate. Burnett has been using the tool about every other year since its implementation at the company. Central Garden and Pet’s $19.6 million 2019 LTL bid saved the company just more than 9 percent when compared to its historical average. For Burnett, though, bid automation extends far beyond savings.“We knew that we weren’t getting the best pricing offer from our carriers just because nothing was centralized,” he continued. “We knew that if we combined everything from all these business units and paired it with one corporate offering, then it would drive some cost benefit with it.”When the company initially decided to centralize bid procurement, executives researched a number of different methodologies and technologies. In the end, though, Burnett found that Bid$ense was both widespread and well known, and that his carrier partners already knew how to use the application. Burnett also highlighted the data-cleansing process as a major benefit, saying the rigorous process ensures that carriers always return the best price.“It definitely has helped drive savings,” he said. “Any time you go out there and you drive that competitiveness with the carriers and they know they’re in a bid environment, it seems to sharpen their pencils.”Transportation procurement is an integral part of the modern supply chain. With Bid$ense, shippers can develop a strategic implementation plan that saves them time and money, but also helps them create strong relationships with their carrier partners. These carriers appreciate the solution’s data-cleansing process; when carriers receive a complete shipment history and future volume forecast, they don’t have to guess on pricing. Carriers that receive more data from shippers get a complete picture of that shipper’s freight, allowing them to accurately plan instead of simply preparing for the worst-case scenario. Clean data presented through an automated system can lead to both bigger shipment savings and a lasting partnership between carrier and customer.Whether customers are looking to streamline over-the-road transportation bidding by automating the RFP process or create an entirely new, centralized sourcing process, Bid$ense has the analytical horsepower to get the job done.SMC³ 2020 Customer Case Study

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Shippers save money, time with automated transportation bidding tools

If there’s one immutable truth in the world of logistics, it’s this: LTL is an inherently complex form of transportation. Tariffs, rates, DIM weights, transit times — it’s enough to confuse even seasoned logistics professionals. The solution to this knowledge gap has historically been on-the-job training or university supply chain education, but for a variety of reasons there is now a pressing need for third-party, remote LTL training that prepares logistics workers for transportation success. Global Scope Can Overlook Local Intricacies In the past, professionals looking to move into a supply chain career learned about the basics of supply chain from universities. However, many of these college supply chain programs are now global in scope, focusing on worldwide supply chain management instead of the intricacies of specialized domestic transportation. And even these programs, which used to be widespread, are becoming less common. LTL is not an industry of broad-brush strokes; supply chain professionals really need a pointillistic understanding of the logistics of LTL in order to excel in the industry. Accelerating Need for Dedicated LTL Education This lack of specified training put the onus on employers to prepare new hires with the LTL knowledge needed to do their jobs. Dedicated LTL study is a necessity, not a luxury. At the same time, changes in LTL and the broader supply chain world are accelerating. The reliance on e-commerce has ballooned since the start of the pandemic, and last-mile LTL shipments and related e-commerce strains on the supply chain won’t diminish once social distancing abates. That genie isn’t going back into the bottle. So supply chain employers need logistics workers that are fully versed in all aspects of the industry, ready to solve unique shipping and delivery problems based on their extensive supply chain knowledge But why care about LTL? It’s been reported that some shippers in today’s world are no longer concerned with what mode is used to ship their goods. A Multimodal Approach Ensures On-Time Delivery This mode agnosticism means supply chain stakeholders have to be well versed in all modes of transportation. As unforeseen weather events and other disruptions, such as protests, become more common, savvy logistics employees will need to be armed with familiarity of all modes, not just the most popular, to ensure that freight is delivered on time, without damage, and in the most financially expedient way possible. Offerings like SMC³’s LTL online education courses cover a wide range of topics from LTL basics and operations to more advanced concepts like pricing analytics and transportation law. The company also has plans to continually refresh content, adding new expert presenters and taking the feedback of students to make the courses even better as time goes on. Learn more about&nbsp;<a href="https://logisticstrainingcenter.com/smc3-courses/" rel="noreferrer" class="joc_admin__link">SMC³’s LTL Online Education program</a>&nbsp;and view the 2021 hybrid schedule, featuring live industry experts,&nbsp;<a href="https://www.smc3.com/onlinelearning2021/" rel="noreferrer" class="joc_admin__link">here.</a>

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Filling the Supply Chain Education Gap with LTL Education Courses

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