Prepare for Global Container Weight Mandate
Effective July 1st, the International Maritime Organization will mandate that every container have a verified gross mass before it can be loaded onto a ship and travel to its final destination as part of the SOLAS Container Weight Verification Requirement.
The International Maritime Organization (IMO) has amended the Safety of Life at Sea Convention (SOLAS) to require, as a condition for loading a packed container onto a ship for export, that the container has a verified weight. The shipper is responsible for the verification of the packed container?s weight.
This requirement will become legally effective on July 1, 2016. After that date, it would be a violation of SOLAS to load a packed container onto a vessel if the vessel operator and marine terminal operator do not have a verified container weight.
The SOLAS amendments provide that there are two methods shippers may use to determine the container weight once this requirement will apply globally. Shippers, freight forwarders, vessel operators, and terminal operators will all need to establish policies and procedures to ensure the implementation of this regulatory change.
How the Panama Canal Expansion is Redrawing the Logistics Container Map
Supply Chain 24/7 ? December 19, 2015
According to research conducted jointly by The Boston Consulting Group and C.H. Robinson, as much as 10 percent of container traffic between East Asia and the US. Could shift from West Coast ports to East Coast ports by the year 2020. Small percentages translate into big numbers in container traffic on high-volume lanes between East Asia and the US. This trade represents more than 40 percent of containers flowing into the US.
Rerouting 10 percent of that volume, therefore, is equivalent to building a new port roughly double the size of the ports in Savannah and Charleston. This shift will have profound effects.
The larger ports on the West Coast will experience lower growth rates, altering the competitive balance between West Coast ports and East Coast ports. (With global container flows rising, West Coast ports will still handle more containers than they do today.) It will also shape the investment and routing decisions of rail and truck carriers, magnify the trade-offs that shippers make between the cost and the speed of transportation, and potentially alter the location of distribution centers.
West Coast ports currently receive two-thirds of container flows from East Asia, with much of that cargo moving by rail and truck as far east as the Ohio River Valley, about three-quarters of the way across the U.S. But once the big, efficient ?post-Panamax?container ships begin passing through the wider, deeper canal, the shipping dynamics will change. For shipping to many destinations, using West Coast ports will still be the fastest option - but it won?t necessarily be the cheapest. For price-sensitive cargo that is relatively expensive to move, routing shipments through East Coast ports to inland destinations will become more cost competitive and increasingly attractive.
The expansion of the Panama Canal will address two issues of capacity that are hampering the canal?s competitiveness in its second century of operation. First, the volume of cargo that passes through the canal sometimes exceeds the amount for which it was designed, causing traffic jams at peak times. Second, the canal is too small for the so-called post-Panamax vessels, which carry two to three times as much cargo as the ships that now squeeze through the canal.
These new vessels, the length of four U.S. football fields, make up about 16 percent of the global container fleet but carry 45 percent of container cargo. Within 15 years, these vessels will carry nearly two-thirds of global container traffic. They currently travel from Asia to the U.S. West Coast and to Europe through the roomy Suez Canal. Few East Coast ports can currently accept these leviathans.
The Changing Logistical Landscape The Panama Canal expansion will address both capacity issues with a new set of locks and wider, deeper channels, allowing more vessels and larger vessels to travel through the canal. The capacity of the canal will double, and the operating costs of shipping between East Asia and the East Coast could fall by up to 30 percent because the labor and fuel costs per container are lower on these larger vessels. (We assume that carriers will pass along these cost reductions to shippers, since the industry is highly competitive and capacity is abundant.)
To accept the larger vessels, East Coast ports are widening and deepening their channels and installing larger off-loading cranes. At the New York?New Jersey port, a bridge even needs to be raised so these 160-foot-high vessels can reach the docks.
Two maritime battles are under way: one between West Coast and East Coast ports, and the other between the Panama and Suez canals. Two-thirds of container traffic from East Asia currently arrives at West Coast ports, one-fifth travels through the Panama Canal for eastern destinations, and 14 percent reaches the East through the Suez Canal. The East Coast has steadily been gaining ground in container traffic from East Asia; in fact, its share rose from 32 percent in 2010 to 35 percent in 2014.
In the battle between the two canals, the Suez is picking up market share. From 2010 to 2014, the Suez?s share of East Coast container traffic rose from 32 percent to 38 percent. After the Panama Canal expansion, the two canals will be in fierce competition for traffic between East Asia and the East Coast. Passage through the Panama Canal will be faster. But the Suez is also undergoing modernization to allow for faster transit and two-way traffic, even of larger vessels.
Obama to Hail Economic Gains in Final State of the Union | Dems Huddle on Trade
The Hill By Sylvan Lane
President Obama will deliver his final State of the Union address, and the economy will likely be a centerpiece.
After 63 consecutive months of job growth and -- according to some economists -- full employment in sight, Obama said he'll highlight "not just the remarkable progress we've made, not just what I want to get done in the year ahead, but what we all need to do together in the years to come" in previewing the Jan. 12 speech.
"The big things that will guarantee an even stronger, better, more prosperous America for our kids -- that's what's on my mind," Obama added. One of those "big things" is almost certainly the Trans-Pacific Partnership (TPP), the massive trade deal with 11 other nations that's a central piece of Obama's economic agenda. The president is pushing the deal with support from leading business groups despite headwinds from Senate Majority Leader Mitch McConnell (R-Ky.), who said the president would need to wait until after the 2016 elections for a vote. The president will likely urge Congress to act quickly to bolster American businesses and undercut China's economic influence in the Pacific region.
It's a short legislative week, so House Democrats are using their time to talk trade. Rep. Sandy Levin (Mich.), top Democrat on the House Ways and Means Committee; and Sen. Sherrod Brown (Ohio), ranking member on the Senate Banking, Housing and Urban Affairs Committee who also serves on the Finance Committee, plan a roundtable discussion Monday in the Capitol on the potential effects of the TPP on automotive manufacturing. In particular they'll focus on the trade deal's rules of origin for the auto industry.
One day after the president's address, House Budget Committee Chairman Tom Price (R-Ga.) plans to head to the Brookings Institution for what is expected to be a wide-ranging conversation about House Republicans' budget priorities this year. Topics could include the prospects for improving the budget process, the debate over tax and spending in the presidential campaign, and what Congress is hoping accomplish this election year.
Federal Reserve Vice Chairman Stanley Fischer plans to shine a light on how the central bank will navigate away from bottom-of-the-barrel borrowing rates at a Paris event Tuesday devoted to monetary policy. One day later, the Fed will release the latest edition of its "Beige Book" of regional reports on the economy's health.
Largest Container Ship, the CMA CGM Benjamin Franklin, Visits Port of Oakland
Port of Oakland ? Jan. 4, 2016
So long, ?Big Ben;? hurry back. That was the message to the 1,310-foot megaship CMA CGM Benjamin Franklin today as she left here following a weekend visit. The largest container vessel to ever call the US sailed from the Port of Oakland. Nicknamed ?Big Ben? by Bay Area media, she left goodwill and the promise of more business in her wake. ?This was a milestone event,? said Port Maritime Director John Driscoll. ?We proved the Port of Oakland can handle big ships efficiently and the entire Bay Area got caught up in the excitement of global trade.?
The CMA CGM Benjamin Franklin, which carries up to 18,000 containers, drew hundreds of sightseers as she sailed into Oakland New Year?s Eve. Many more watched her departure this afternoon under cloudy skies.
The visit was viewed as a trial-run to determine if big ships can work effectively on the US West Coast. The initial verdict from Port officials: They can. More than 2,200 cargo containers were moved on and off the CMA CGM Benjamin Franklin Saturday and Sunday. Cargo operations concluded on schedule Sunday night. Port officials reported no problems with cargo handling equipment or staffing levels.
?The CMA CGM Benjamin Franklin?s call at the Port of Oakland was made possible thanks to a tight collaboration with all stakeholders at the Port,? said Marc Bourdon, President of CMA CGM (America) LLC, a subsidiary of CMA CGM, the vessel?s operator. ?By welcoming the largest container ship ever to call at US ports, authorities have demonstrated their willingness to be part of an ever growing shipping industry.?
The CMA CGM Benjamin Franklin is scheduled to make a second West Coast visit in February. Maritime experts expect megaships such as the CMA CGM Benjamin Franklin to become an increasingly important part of the Trans-Pacific trade between Asia and the US.
From all of us at Byrnes we take this time to express our THANKS for your business and loyalty. We continue to hold to our commitment and dedicated focus to maintain current awareness of the constant changes to global trade and how that affects each of you, our clients, and us as a licensed service provider to you. We will never sacrifice that commitment. A new year always brings with it new changes to the rules and regulations affecting global trade and we will work with you to keep you current with any changes that might have affect or obligation to how you conduct business.[/
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