<div class="phx-topic abstract-wrapper">Forwarders believe carriers are now a bit uncertain about their ability to secure enough cargo from shippers for spot bookings given that some exporters are known to have put their orders on hold because of high ocean rates and other challenges.</div>

Forwarders believe carriers are now a bit uncertain about their ability to secure enough cargo from shippers for spot bookings given that some exporters are known to have put their orders on hold because of high ocean rates and other challenges.

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<div>Container lines targeting Indian headhaul loads appear somewhat skeptical whether they will have an opportunity to push short-term contract rates higher in March despite typical fiscal year-end shipping demand expectations. The Indian 2023-24 fiscal year ends March 31. According to market sources, local freight forwarders have had no rate change indications from their liner partners for early March contract deals on connections to the US and Europe. That guarded approach follows <a>the Journal of Commerce earlier this month reporting</a> a noticeable downward slope in India-US contract rates and a relatively stable pricing trend for India-Europe loads, compared with steep week-on-week...

Container lines targeting Indian headhaul loads appear somewhat skeptical whether they will have an opportunity to push short-term contract rates higher in March despite typical fiscal year-end shipping demand expectations. The Indian 2023-24 fiscal year ends March 31. According to market sources, local freight forwarders have had no rate change indications from their liner partners for early March contract deals on connections to the US and Europe. That guarded approach follows the Journal of Commerce earlier this month reporting a noticeable downward slope in India-US contract rates and a relatively stable pricing trend for India-Europe loads, compared with steep week-on-week upward movements seen through January. Forwarders believe that carriers are now a bit uncertain about their ability to secure enough cargo from shippers alone for spot bookings, given that some exporters are known to have put their orders on hold because of high ocean rates and other challenges. To put that concern in perspective, the Federation of Indian Export Organizations (FIEO) in a recent study estimated potential national export losses by value from the current Red Sea disruption at about $64 billion for fiscal year 2023-24. “Rates to the US and Europe are generally cool at the moment,” a Mumbai-based forwarder noted. “But carrier contract pricing strategies for the upcoming weeks could depend a great deal on how volumes develop.” Most India-US liners have substantial general rate increase (GRI) and peak season surcharge (PSS) plans for March, ranging from $1,000 to $1,800 per container due to take effect from March 1 or March 4. A $1,000-per-container PSS from March 10 is in the offering for India-Europe trades. Forwarder sources put current average spot pricing at $3,813 per TEU and $4,094 per FEU for West India-North Europe bookings, and at $4,514 and $4,614, respectively, to the US East Coast. Platts, a sister company of the Journal of Commerce within S&P Global, pegged India-US East Coast spot rates at $4,800 per FEU as of Feb. 26, down 3% from the week prior. Tej Contractor, director at Mumbai-based forwarder MCC Container Lines, said it is still too early to paint the March pricing picture, but recovering the proposed increases at full scale seems difficult. “There remains some uncertainty, even though many carriers have seven- to 15-day cargo backlogs,” Contractor said. “We have to see the demand.” However, another forwarder noted that prices will likely increase for customers who have contracts with a clause providing for rate adjustments. “All-in rates type of contracts and bigger or high-volume customer accounts — for example, Kuehne+Nagel or Noble Shipping or Allcargo — won’t be subject to any additional charges,” the source said. Ravi Jakhar, chief strategy officer at cargo consolidation service leader Allcargo Group, had a similar take on rate trends. “The overall ocean rate outlook for fiscal 2024-25 still remains uncertain with possible rate spikes in the affected routes,” Jakhar said. “There’s also an expectation for demand to rebound in the latter part of the year.” Dharmendra Gangrade, head of logistics management at Indian diversified conglomerate Larsen & Toubro, told the Journal of Commerce that the industry has now gained the agility to quickly adapt to volatile environments as disruptions become more frequent. “The new normal seems to have become a ‘regular normal’ for trade verticals, but it doesn’t mean elevated rates will remain an accepted norm for the longer term,” Gangrade said. “Although we have rates significantly higher than the end-2023 trendline, freight index values are commonly greater than the market reality.” Contact Bency Mathew at bencyvmathew@gmail.com .

Container lines

International ports

Container Shipping News

Maritime

Volume uncertainty shrouds carriers' March pricing plans on Indian trades

<div class="phx-topic abstract-wrapper">But forwarders say the effort by liners to end a four-month decline in rates may lose steam after a week or so given generally weak market fundamentals. </div>

But forwarders say the effort by liners to end a four-month decline in rates may lose steam after a week or so given generally weak market fundamentals.

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<div class="phx-topic">Spot rates on the eastbound trans-Pacific have jumped by about $700 to the US West Coast this week with retailers stepping up their purchase orders for the fourth quarter now that factories in Asia have reopened following the Golden Week and Autumn festivals, market sources say. But forwarders say the effort to end a four-month decline in container spot rates may stumble, and carriers have few other options. The gains came via a general rate increase (GRI) carriers implemented Wednesday, with prices rising to about $2,000 per FEU for West Coast business from $1,300 per FEU last week. Multiple forwarders and a carrier source told the Journal of Commerce that carriers are getting the higher rates from customers. “Bookings are stronger than anticipated after the Autumn Festival,” one forwarder said. “In general, the market is showing some resilience.” Business to the US East Coast was pegged at $3,050 to $3,100 per FEU, up from $2,300. Still, carriers and forwarders expect this week’s GRIs, such as the price hike made on Sept. 1, to deteriorate after a week to 10 days, likely to be followed by additional GRI attempts on Nov. 1 and Nov. 15. “This could be deja vu from Sept. 1,” said Chris Sur, vice president/ocean of freight contract logistics at the forwarder Unique Logistics International. Helping to support the trans-Pacific market at the moment is the fact that vessel capacity has been reduced amid multiple blank sailings and some suspended weekly services due to weakened import demand in August and September. Yet another factor influencing retailers’ ordering behavior this fall has been tariff uncertainties amid the Trump administration’s shifting trade policies for individual countries. This will play out for the remainder of the fourth quarter, said Jon Monroe, who serves as an adviser to forwarders. “Nobody knows what to expect from Trump,” he said. “Everyone is rushing now to get their orders out by the end of the year.” <h3>Inventory restocking, spring imports coming next </h3>Retailers, especially the big box stores, are beginning to focus now on re-stocking their inventories and placing their spring orders, said Robert Khachatryan, CEO of the forwarder FreightRight Global Logistics. “We could see increased orders in November and December,” he said. The traditional peak season shipping patterns this year were disrupted by the constantly changing US tariff announcements. July was the peak month for US imports from Asia; normally, imports of holiday merchandise remain strong from August through October. US imports from Asia in July totaled 1.81 million TEUs, dropping to 1.75 million TEUs in August and 1.58 million TEUs in September, according to PIERS, a Journal of Commerce sister product within S&amp;P Global. Carriers have already filed their 30-day notice in advance of proposed GRIs for Nov. 1 and Nov. 15, so further rate hikes, albeit short-lived, can be expected as liners attempt to set a floor under spot rates, a carrier executive told the Journal of Commerce. “Rates had gotten too low. This behavior is nothing new,” the source said. Contact Bill Mongelluzzo at <a href="mailto:bill.mongelluzzo@spglobal.com">bill.mongelluzzo@spglobal.com</a>. </div>

Spot rates on the eastbound trans-Pacific have jumped by about $700 to the US West Coast this week with retailers stepping up their purchase orders for the fourth quarter now that factories in Asia have reopened following the Golden Week and Autumn festivals, market sources say. But forwarders say the effort to end a four-month decline in container spot rates may stumble, and carriers have few other options. The gains came via a general rate increase (GRI) carriers implemented Wednesday, with prices rising to about $2,000 per FEU for West Coast business from $1,300 per FEU last week. Multiple forwarders and a carrier source told the Journal of Commerce that carriers are getting the higher rates from customers. “Bookings are stronger than anticipated after the Autumn Festival,” one forwarder said. “In general, the market is showing some resilience.” Business to the US East Coast was pegged at $3,050 to $3,100 per FEU, up from $2,300. Still, carriers and forwarders expect this week’s GRIs, such as the price hike made on Sept. 1, to deteriorate after a week to 10 days, likely to be followed by additional GRI attempts on Nov. 1 and Nov. 15. “This could be deja vu from Sept. 1,” said Chris Sur, vice president/ocean of freight contract logistics at the forwarder Unique Logistics International. Helping to support the trans-Pacific market at the moment is the fact that vessel capacity has been reduced amid multiple blank sailings and some suspended weekly services due to weakened import demand in August and September. Yet another factor influencing retailers’ ordering behavior this fall has been tariff uncertainties amid the Trump administration’s shifting trade policies for individual countries. This will play out for the remainder of the fourth quarter, said Jon Monroe, who serves as an adviser to forwarders. “Nobody knows what to expect from Trump,” he said. “Everyone is rushing now to get their orders out by the end of the year.” Inventory restocking, spring imports coming next Retailers, especially the big box stores, are beginning to focus now on re-stocking their inventories and placing their spring orders, said Robert Khachatryan, CEO of the forwarder FreightRight Global Logistics. “We could see increased orders in November and December,” he said. The traditional peak season shipping patterns this year were disrupted by the constantly changing US tariff announcements. July was the peak month for US imports from Asia; normally, imports of holiday merchandise remain strong from August through October. US imports from Asia in July totaled 1.81 million TEUs, dropping to 1.75 million TEUs in August and 1.58 million TEUs in September, according to PIERS, a Journal of Commerce sister product within S&P Global. Carriers have already filed their 30-day notice in advance of proposed GRIs for Nov. 1 and Nov. 15, so further rate hikes, albeit short-lived, can be expected as liners attempt to set a floor under spot rates, a carrier executive told the Journal of Commerce. “Rates had gotten too low. This behavior is nothing new,” the source said. Contact Bill Mongelluzzo at bill.mongelluzzo@spglobal.com .

Forwarding

Trans-Pacific

Spot rates in eastbound trans-Pacific pop after carriers set new GRIs

<div class="phx-topic abstract-wrapper">China’s new port fees on non-China-made vessels that are US-flagged or owned or controlled by US companies are forcing the Gemini Cooperation partners to transship via South Korea to avoid the multimillion-dollar hit. </div>

China’s new port fees on non-China-made vessels that are US-flagged or owned or controlled by US companies are forcing the Gemini Cooperation partners to transship via South Korea to avoid the multimillion-dollar hit.

<div class="phx-topic">The Gemini Cooperation diverted two US-flag vessels in a trans-Pacific service away from China due to that country’s retaliatory port fees, with one of the alliance partners warning of a multimillion-dollar hit that carriers face on US-flag ships because of the fees. Maersk and Hapag-Lloyd advised customers on Tuesday that two US-flag ships in their jointly-operated TP7/WC5 service will no longer call Ningbo. This week’s voyage of Hapag-Lloyd’s Potomac Express will discharge westbound cargo for China in Busan, South Korea, and then be transshipped on another ship. The Denmark-flagged Maersk Luz will carry outbound freight from Ningbo to South Korea’s Kwangyang port, which will then be loaded on the Potomac Express. Next week’s voyage of the Maersk Kinloss will also discharge westbound China cargo in South Korea for transshipment on an unidentified ship, with eastbound cargo from Ningbo being shipped on a Gemini shuttle ship. The service switch-up comes as <a href="https://www.joc.com/article/china-returns-fire-with-retaliatory-port-fees-targeting-us-affiliated-ships-6095198">China’s recently unveiled port fees on US-flag ships</a> went into effect on Oct. 14, the same day as similar US port fees took effect on Chinese-built ships and carriers. While China has exempted US-flag ships built in China from the fees, both of Gemini’s affected ships were built in South Korea. China plans to charge US-flag, non-Chinese vessels $56 per net ton, approximately similar to what the US is levying. Based on their net tonnage, each of the Gemini ships would incur a $2.5 million charge. <h3>Hapag-Lloyd looks to adjust </h3>Stuart Sandlin, Hapag-Lloyd’s North American president, said Wednesday at the Virginia Maritime Association trade conference in Norfolk that the carrier’s five US-flagged, South Korean-built ships would face a total of $125 million in Chinese port fees annually. The US-flag international fleet can also carry commercial cargo to and from China, in addition to any government or military cargo for other Asian countries. Sandlin said Hapag-Lloyd is now looking at how to split up that business to avoid the fees. “We have a US-flag group, and we have a non-US-flag group, and that makes it a lot more difficult because of the current geopolitical situation,” he said. “We’re working to see how we actually manage through that.” There are currently 57 ships in the US-flag international fleet, according to Sea-web, a sister company of the Journal of Commerce within S&amp;P Global. Those US-flag ships made 163 calls globally year to date. The US-flag Matson Waikiki, which called Shanghai on Tuesday, faces a $1.7 million fee. Among US-flag carriers, CMA CGM’s APL division runs the only fleet solely built in China. Contact Michael Angell at <a href="mailto:michael.angell@spglobal.com">michael.angell@spglobal.com</a>. </div>

The Gemini Cooperation diverted two US-flag vessels in a trans-Pacific service away from China due to that country’s retaliatory port fees, with one of the alliance partners warning of a multimillion-dollar hit that carriers face on US-flag ships because of the fees. Maersk and Hapag-Lloyd advised customers on Tuesday that two US-flag ships in their jointly-operated TP7/WC5 service will no longer call Ningbo. This week’s voyage of Hapag-Lloyd’s Potomac Express will discharge westbound cargo for China in Busan, South Korea, and then be transshipped on another ship. The Denmark-flagged Maersk Luz will carry outbound freight from Ningbo to South Korea’s Kwangyang port, which will then be loaded on the Potomac Express. Next week’s voyage of the Maersk Kinloss will also discharge westbound China cargo in South Korea for transshipment on an unidentified ship, with eastbound cargo from Ningbo being shipped on a Gemini shuttle ship. The service switch-up comes as China’s recently unveiled port fees on US-flag ships went into effect on Oct. 14, the same day as similar US port fees took effect on Chinese-built ships and carriers. While China has exempted US-flag ships built in China from the fees, both of Gemini’s affected ships were built in South Korea. China plans to charge US-flag, non-Chinese vessels $56 per net ton, approximately similar to what the US is levying. Based on their net tonnage, each of the Gemini ships would incur a $2.5 million charge. Hapag-Lloyd looks to adjust Stuart Sandlin, Hapag-Lloyd’s North American president, said Wednesday at the Virginia Maritime Association trade conference in Norfolk that the carrier’s five US-flagged, South Korean-built ships would face a total of $125 million in Chinese port fees annually. The US-flag international fleet can also carry commercial cargo to and from China, in addition to any government or military cargo for other Asian countries. Sandlin said Hapag-Lloyd is now looking at how to split up that business to avoid the fees. “We have a US-flag group, and we have a non-US-flag group, and that makes it a lot more difficult because of the current geopolitical situation,” he said. “We’re working to see how we actually manage through that.” There are currently 57 ships in the US-flag international fleet, according to Sea-web, a sister company of the Journal of Commerce within S&P Global. Those US-flag ships made 163 calls globally year to date. The US-flag Matson Waikiki, which called Shanghai on Tuesday, faces a $1.7 million fee. Among US-flag carriers, CMA CGM’s APL division runs the only fleet solely built in China. Contact Michael Angell at michael.angell@spglobal.com .

Port News

China’s port fees forcing Gemini to shift out US-flag ships

<div class="phx-topic abstract-wrapper">Trade professionals and shippers say US Customs and Border Protection is pursuing trade violations with historic vigor. </div>

Trade professionals and shippers say US Customs and Border Protection is pursuing trade violations with historic vigor.

<div class="phx-topic">Norfolk, Virginia — US Customs and Border Protection (CBP) is ratcheting up scrutiny on importers through an uptick in queries about specific shipments, Eugene Laney, the president and CEO of the American Association of Exporters and Importers (AAEI), told the Virginia Maritime Association’s International Trade Symposium Wednesday. Laney said importers are facing a barrage of what are known as Customs Forms 28 (CF-28), which are requests for information issued by CBP. Those CF-28s can then lead to Customs Forms 29 (CF-29), which are notices of decisions that require importers to rectify a wide variety of infractions, including tariff misclassifications, valuation changes, country of origin determination, or free trade agreement eligibility. “Folks that have been in the customs business for many years have seen more 28s and 29s on a daily basis than ever, and this is alarming for companies,” Laney said. “They haven’t seen anything like this.” Laney said CBP’s enforcement has been rigorous, especially in terms of scrutinizing country of origin determinations, even at the raw material level. “They’re looking at everything,” he said. “They’re looking at the aluminum that’s on the cap of the toothpaste. They’re looking at the aluminum that’s in deodorant. You have all these companies that don’t even realize they’re in the aluminum and steel business. They’re now having to figure out how they need to hire [artificial intelligence] companies to help them figure out exactly what’s in their products.” <h3>Compliance burden </h3>Laney’s comments dovetail with recent comments from Gabrielle Griffith, director at trade advisory firm BPE Global. “It’s not just anecdotal,” Griffith said on the Oct. 10 episode of the Journal of Commerce’s TPM Today. “We have certainly seen an increase in our clients getting those requests for information — the CF-28s — from CBP.” Griffith said clients are often curious as to how CBP has seemingly expanded its capability to scrutinize shipments, as CF-28s create an administrative compliance burden they haven’t experienced, perhaps outside of the immediate aftermath of the Sept. 11 terror attacks. “What’s changed is the data analytics,” she said. “There has been quite an enhancement to the data analytics CBP is using to comb shipments to target investigations.” Importers have confirmed in recent weeks to the Journal of Commerce that the number of CF-28s has risen markedly, with most noting they are getting such notices regularly. “These enforcement actions have brought trade compliance professionals from being hidden in the company to now in the C-suite,” Laney said. “They’re actually meeting with the CEOs, meeting with boards, because boards are alarmed by these enforcement actions.” Contact Eric Johnson at <a href="mailto:eric.johnson@spglobal.com">eric.johnson@spglobal.com</a>. </div>

Norfolk, Virginia — US Customs and Border Protection (CBP) is ratcheting up scrutiny on importers through an uptick in queries about specific shipments, Eugene Laney, the president and CEO of the American Association of Exporters and Importers (AAEI), told the Virginia Maritime Association’s International Trade Symposium Wednesday. Laney said importers are facing a barrage of what are known as Customs Forms 28 (CF-28), which are requests for information issued by CBP. Those CF-28s can then lead to Customs Forms 29 (CF-29), which are notices of decisions that require importers to rectify a wide variety of infractions, including tariff misclassifications, valuation changes, country of origin determination, or free trade agreement eligibility. “Folks that have been in the customs business for many years have seen more 28s and 29s on a daily basis than ever, and this is alarming for companies,” Laney said. “They haven’t seen anything like this.” Laney said CBP’s enforcement has been rigorous, especially in terms of scrutinizing country of origin determinations, even at the raw material level. “They’re looking at everything,” he said. “They’re looking at the aluminum that’s on the cap of the toothpaste. They’re looking at the aluminum that’s in deodorant. You have all these companies that don’t even realize they’re in the aluminum and steel business. They’re now having to figure out how they need to hire [artificial intelligence] companies to help them figure out exactly what’s in their products.” Compliance burden Laney’s comments dovetail with recent comments from Gabrielle Griffith, director at trade advisory firm BPE Global. “It’s not just anecdotal,” Griffith said on the Oct. 10 episode of the Journal of Commerce’s TPM Today. “We have certainly seen an increase in our clients getting those requests for information — the CF-28s — from CBP.” Griffith said clients are often curious as to how CBP has seemingly expanded its capability to scrutinize shipments, as CF-28s create an administrative compliance burden they haven’t experienced, perhaps outside of the immediate aftermath of the Sept. 11 terror attacks. “What’s changed is the data analytics,” she said. “There has been quite an enhancement to the data analytics CBP is using to comb shipments to target investigations.” Importers have confirmed in recent weeks to the Journal of Commerce that the number of CF-28s has risen markedly, with most noting they are getting such notices regularly. “These enforcement actions have brought trade compliance professionals from being hidden in the company to now in the C-suite,” Laney said. “They’re actually meeting with the CEOs, meeting with boards, because boards are alarmed by these enforcement actions.” Contact Eric Johnson at eric.johnson@spglobal.com .

Supply chain

Transport, Trade and Regulation News

Importers see major uptick in CBP requests for shipment information

<div class="phx-topic abstract-wrapper">A 25% state subsidy for the newbuild program approved by Indian policymakers after months of negotiations is believed to have pushed the deal through, thus neutralizing the cost gaps with rival yards in China and South Korea. </div>

A 25% state subsidy for the newbuild program approved by Indian policymakers after months of negotiations is believed to have pushed the deal through, thus neutralizing the cost gaps with rival yards in China and South Korea.

<div class="phx-topic">CMA CGM has inked an approximately $350 million newbuild deal with Indian shipbuilding major Cochin Shipyard Ltd. (CSL) for six 1,700-TEU liquefied natural gas (LNG)-powered dual-fuel vessels. The deal confirms <a href="https://www.joc.com/article/cma-cgm-eyes-shipbuilding-plans-for-india-in-trade-diversification-strategy-sources-6088185">earlier reporting</a> from the Journal of Commerce. The French shipping group, in a letter of intent signed with CSL on Tuesday, agreed to order the six vessels, the first attempt by a major mainliner in the Indian market. “India is a strategic country for CMA CGM, where we invest, train and innovate,” group Chairman and CEO Rodolphe Saadé said in a statement. “Beyond shipbuilding, we are strengthening our partnerships in logistics, maritime training and sustainable transport to support India’s growth and contribute to the decarbonization of global trade.” The deal is estimated to cost the carrier approximately $60 million per ship, according to CSL sources. Vessel deliveries are scheduled to take place between 2029 and 2031, with all ships to be India-flagged. A 25% state subsidy for the newbuild program approved by Indian policymakers after months of negotiations is believed to have finally pushed the deal through, thus neutralizing the cost gaps with rival yards in China and South Korea. Local container industry leaders greeted the shipbuilding news warmly. “India is embarking on shipbuilding/repairs/recycling verticals in a significant manner as the economy expands,” Sunil Vaswani, executive director of the Container Shipping Lines Association (India), told the Journal of Commerce. “India’s serious entry into this sphere offers another [sourcing] option for the international carriers.” <h3>CMA CGM bolstering presence in India </h3>The contract seemingly is a win-win proposition for both parties, as CSL aims to push yard operations via a strategic alliance with HD Korea Shipbuilding &amp; Offshore Engineering and CMA CGM looks to raise the bar on its Indian presence beyond port-to-port shipping. The liner now has dedicated box terminals at Nhava Sheva and Mundra, the country’s top cargo handlers, gaining the flexibility to turn around vessels more seamlessly amid the lingering Red Sea-linked pressure on schedule reliability. A recent resetting of berthing windows around CMA CGM’s own Nhava Sheva terminal for the premier India-US East Coast “Indamex” and India-Europe “Epic” services underpins those considerations. Contact Bency Mathew at <a href="mailto:bencyvmathew@gmail.com">bencyvmathew@gmail.com</a>. </div>

CMA CGM has inked an approximately $350 million newbuild deal with Indian shipbuilding major Cochin Shipyard Ltd. (CSL) for six 1,700-TEU liquefied natural gas (LNG)-powered dual-fuel vessels. The deal confirms earlier reporting from the Journal of Commerce. The French shipping group, in a letter of intent signed with CSL on Tuesday, agreed to order the six vessels, the first attempt by a major mainliner in the Indian market. “India is a strategic country for CMA CGM, where we invest, train and innovate,” group Chairman and CEO Rodolphe Saadé said in a statement. “Beyond shipbuilding, we are strengthening our partnerships in logistics, maritime training and sustainable transport to support India’s growth and contribute to the decarbonization of global trade.” The deal is estimated to cost the carrier approximately $60 million per ship, according to CSL sources. Vessel deliveries are scheduled to take place between 2029 and 2031, with all ships to be India-flagged. A 25% state subsidy for the newbuild program approved by Indian policymakers after months of negotiations is believed to have finally pushed the deal through, thus neutralizing the cost gaps with rival yards in China and South Korea. Local container industry leaders greeted the shipbuilding news warmly. “India is embarking on shipbuilding/repairs/recycling verticals in a significant manner as the economy expands,” Sunil Vaswani, executive director of the Container Shipping Lines Association (India), told the Journal of Commerce. “India’s serious entry into this sphere offers another [sourcing] option for the international carriers.” CMA CGM bolstering presence in India The contract seemingly is a win-win proposition for both parties, as CSL aims to push yard operations via a strategic alliance with HD Korea Shipbuilding & Offshore Engineering and CMA CGM looks to raise the bar on its Indian presence beyond port-to-port shipping. The liner now has dedicated box terminals at Nhava Sheva and Mundra, the country’s top cargo handlers, gaining the flexibility to turn around vessels more seamlessly amid the lingering Red Sea-linked pressure on schedule reliability. A recent resetting of berthing windows around CMA CGM’s own Nhava Sheva terminal for the premier India-US East Coast “Indamex” and India-Europe “Epic” services underpins those considerations. Contact Bency Mathew at bencyvmathew@gmail.com .

CMA CGM signs $350 million Indian shipbuilding order for six box ships

<div class="phx-topic abstract-wrapper">The ILWU is warning the state’s governor of political consequences, while maritime employers say the decision preserves the integrity of collective bargaining.</div>

The ILWU is warning the state’s governor of political consequences, while maritime employers say the decision preserves the integrity of collective bargaining.

<div class="phx-topic">California Gov. Gavin Newsom’s refusal to sign a bill that would have effectively banned automation at the state’s ports “will undoubtedly lead to a loss of jobs,” the International Longshore and Warehouse Union (ILWU) said Tuesday. But maritime employers hailed Newsom’s decision, saying it “reinforces the integrity of collective bargaining” at West Coast ports. The bill, known as SB 34, <a href="https://www.joc.com/article/fate-of-future-automation-at-california-ports-in-governors-hands-6094241">would have banned automated or remotely operated cargo-handling equipment from plugging into the state’s power grid</a>. Newsom late Monday refused to sign the bill, in effect killing it. That means the collective bargaining process between the ILWU and the Pacific Maritime Association (PMA) — and not legislative proposals outside of the coastwide contract — will continue to determine the role of marine terminal automation at California’s ports. Robert Olvera Jr., ILWU international president, said the West Coast dockworkers’ union supports California’s attempts to reduce port-related emissions, but not at the sacrifice of longshore jobs. Olvera pulled no punches in saying Newsom’s decision will have political repercussions. “Make no mistake. Your veto of SB 34 has severely damaged our confidence to work together to achieve these goals, and it will take more than rhetoric to rebuild a partnership in the future,” Olvera said in a letter to the governor. PMA President Stephen Hennessey said in a letter to Newsom that by threatening the efficiencies inherent in automated container terminals, SB 34 would have made California’s ports less competitive. PMA represents shipping lines and terminal operators in negotiating the coastwide labor contract with the ILWU. “[Newsom’s] decision sends an important message to consumers, workers, farmers, small business owners and many others that strong, competitive ports are essential to California’s economy and its role in global trade,” Hennessey said in the letter. <h3>Coastwide contract defines process for terminal automation </h3>The 2008 ILWU-PMA contract defined the process by which individual PMA terminal operators that choose to do so can automate their facilities. In return, PMA agreed to an increase in wages and retirement benefits for all ILWU members coastwide. Long Beach Container Terminal and TraPac in Los Angeles have fully automated terminals, while APM Terminal in Los Angeles has automated 100 acres of its 400-acre terminal. Since the 2008 contract, the ILWU on several occasions has promoted restrictions on automation before <a href="https://www.joc.com/article/commission-vote-allows-apms-electrification-of-automation-5244491">port commissions, city councils and the state legislature</a> through environmental legislation and work-related issues in an attempt to circumvent the language in the contract. The Pacific Merchant Shipping Association (PMSA), which represents shipping lines and terminal operators on the West Coast on legislative and clean air initiatives, said that by using environmental issues as a vehicle for restricting automation, the ILWU’s actions actually threaten the effectiveness of the ports’ clean air efforts. PMSA President Mike Jacob noted that the ports of Los Angeles and Long Beach recently reached an agreement with the South Coast Air Quality Management District (AQMD) to work cooperatively to advance clean air initiatives that the AQMD had proposed in its <a href="https://www.joc.com/article/la-lb-likely-to-work-with-regulator-on-emissions-cutting-plan-for-ports-6084550">port Indirect Source Rule.</a> While the ILWU says it supports environmental efforts at the port, Jacob said stifling automation was the union’s real intention in promoting and supporting SB 34. “This is ILWU’s priority bill,” he said. Contact Bill Mongelluzzo at <a href="mailto:bill.mongelluzzo@spglobal.com">bill.mongelluzzo@spglobal.com</a>.</div>

California Gov. Gavin Newsom’s refusal to sign a bill that would have effectively banned automation at the state’s ports “will undoubtedly lead to a loss of jobs,” the International Longshore and Warehouse Union (ILWU) said Tuesday. But maritime employers hailed Newsom’s decision, saying it “reinforces the integrity of collective bargaining” at West Coast ports. The bill, known as SB 34, would have banned automated or remotely operated cargo-handling equipment from plugging into the state’s power grid . Newsom late Monday refused to sign the bill, in effect killing it. That means the collective bargaining process between the ILWU and the Pacific Maritime Association (PMA) — and not legislative proposals outside of the coastwide contract — will continue to determine the role of marine terminal automation at California’s ports. Robert Olvera Jr., ILWU international president, said the West Coast dockworkers’ union supports California’s attempts to reduce port-related emissions, but not at the sacrifice of longshore jobs. Olvera pulled no punches in saying Newsom’s decision will have political repercussions. “Make no mistake. Your veto of SB 34 has severely damaged our confidence to work together to achieve these goals, and it will take more than rhetoric to rebuild a partnership in the future,” Olvera said in a letter to the governor. PMA President Stephen Hennessey said in a letter to Newsom that by threatening the efficiencies inherent in automated container terminals, SB 34 would have made California’s ports less competitive. PMA represents shipping lines and terminal operators in negotiating the coastwide labor contract with the ILWU. “[Newsom’s] decision sends an important message to consumers, workers, farmers, small business owners and many others that strong, competitive ports are essential to California’s economy and its role in global trade,” Hennessey said in the letter. Coastwide contract defines process for terminal automation The 2008 ILWU-PMA contract defined the process by which individual PMA terminal operators that choose to do so can automate their facilities. In return, PMA agreed to an increase in wages and retirement benefits for all ILWU members coastwide. Long Beach Container Terminal and TraPac in Los Angeles have fully automated terminals, while APM Terminal in Los Angeles has automated 100 acres of its 400-acre terminal. Since the 2008 contract, the ILWU on several occasions has promoted restrictions on automation before port commissions, city councils and the state legislature through environmental legislation and work-related issues in an attempt to circumvent the language in the contract. The Pacific Merchant Shipping Association (PMSA), which represents shipping lines and terminal operators on the West Coast on legislative and clean air initiatives, said that by using environmental issues as a vehicle for restricting automation, the ILWU’s actions actually threaten the effectiveness of the ports’ clean air efforts. PMSA President Mike Jacob noted that the ports of Los Angeles and Long Beach recently reached an agreement with the South Coast Air Quality Management District (AQMD) to work cooperatively to advance clean air initiatives that the AQMD had proposed in its port Indirect Source Rule. While the ILWU says it supports environmental efforts at the port, Jacob said stifling automation was the union’s real intention in promoting and supporting SB 34. “This is ILWU’s priority bill,” he said. Contact Bill Mongelluzzo at bill.mongelluzzo@spglobal.com .

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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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