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Signals™ Headlines - February 4, 2015

FMC Chairman Says Addressing Port Congestion Issues is Top Priority for 2015

Federal Maritime Commission (FMC) Chairman Mario Cordero has announced his priority for the Commission in 2015 is addressing congestion issues that are plaguing the nation’s ports. Starting in September 2014, FMC Commissioners led public forums concerning port congestion and international supply chain efficiency issues. The Chairman says this focus is in keeping with the Commission’s 2014-2018 Strategic Plan.

In recent remarks Chairman Cordero stated, “Among the Commission’s statutory goals is the assurance of an efficient ocean transportation system. The efficient operation of the Nation’s ports is squarely within that mandate and paramount to the Commission’s responsibilities. As we move forward, I look forward to a thorough review of the issues and views that have been provided from various maritime industry stakeholders. The FMC will continue its role in protecting the shipping public and addressing unreasonable or unjust practices by carriers or marine terminal operators.” The FMC has sponsored forums at Los Angeles, Baltimore, Charleston, and New Orleans focused on congestion and the challenges facing the nation’s seaports. In her remarks at the New Orleans forum, FMC Commissioner Rebecca Dye said “Port and supply chain disruption deserves permanent, continual collaboration by all organizations interested in port operations. This matter is vitally important to transportation businesses and to the American economy and it requires our consistent attention.”

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FMC to Host Annual Port Environmental Initiatives Forum on February 20, 2015

The FMC will host its annual Port Environmental Issues Forum on February 20, 2015 in its Main Hearing Room at its headquarters in Washington, DC. This year’s discussion will focus on cooperation among competing neighbor ports and terminals to achieve environmental benefits in their surrounding communities under the authority of the Shipping Act of 1984. This will be the third year the Commission has held this event. Representatives of the ports of Los Angeles and Long Beach, the port of New York/ New Jersey, and the ports of Seattle and Tacoma are expected to attend. Mr. Kurt Nagle, President, American Association of Ports Authorities, will serve as moderator. The FMC has an in-house Maritime Environmental Committee (MEC) that complements the FMC’s mission by facilitating best practices in the maritime community by recognizing environmental sustainable shipping practices.

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President Obama Nominates FMC Chairman for a Second Term

On January 13, 2015, the Whitehouse announced President Obama has nominated FMC Chairman Mario Cordero for a term expiring June 30, 2019. This reappointment nomination has been sent to the U.S. Senate Committee on Commerce, Science, and Transportation, which will schedule a hearing on this nomination in due course. Mr. Cordero has served as a Commissioner since June 2011 and as FMC Chairman since April 2013. Prior to joining the Commission, Mr. Cordero spent over thirty years in private legal practice, and served eight years on the Board of Harbor Commissioners for the Port of Long Beach (POLB). He was also adjunct professor for the Long Beach City College, where he taught political science.

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Transpacific Eastbound Carriers File General Rate Increase Effective February 9, 2015

Several carrier members of the Transpacific Stabilization Agreement (TSA), FMC Agreement No. 011223 serving the East Asia/USA trade lanes, have filed General Rate Increases (GRIs) of USD 600 per forty-foot equivalent unit (FEU), effective February 9, 2015, including American President Lines (APL), CMA CGM, Evergreen, Hanjin, Hapag Lloyd, Hyundai, K Line, OOCL, and Yang Ming. COSCO filed a GRI for USD 400 per FEU, effective February 5, 2015. FMC Tariffs of APL, Evergreen, and OOCL provide a GRI of USD 300 per FEU for origins in India, Pakistan, Sri Lanka, and Bangladesh, effective February 15, 2015. However, APL will not apply this GRI to cargo from Japan. The GRI amounts for all other sizes are as per formula, though formulas for 20′ container size vary by carrier. This is the second GRI of the year for this trade lane.

Several TSA member carriers, who had updated their FMC tariffs in mid-December 2014 to reflect General Rate Increases (GRIs), implemented these GRIs effective January 15, 2015. This includes CMA CGM, Hanjin, Hyundai, K Line, Maersk, and Yang Ming, who each implemented GRIs in the amount of USD 600 per FEU for cargo moving to all USA destinations, with a few exceptions. APL implemented a GRI of USD 300 per FEU for destinations to U.S. Pacific Coast Ports, IPI, and MLB, and USD 400 per FEU to U.S. Atlantic Coast Ports and RIPI. Evergreen also reduced and implemented a GRI of USD 200 per FEU for cargo delivered to California and IPI destinations, and a GRI of USD 400 per FEU for all other USA destinations, excluding shipments originating in India, Sri Lanka, Pakistan, Bangladesh, which will be subject to a GRI of USD 500 per FEU effective February 15. Hanjin cancelled its GRI for cargo from Japan, Pakistan, Colombo, and applied a GRI of USD 200 per FEU to cargo from India and Bangladesh via U.S. East Coast Ports and Houston, TX. Hyundai withdrew its GRI for Japan and India Sub-continent origin cargo. OOCL cancelled its January GRI.

Some TSA carriers, including COSCO and MOL, filed and implemented GRIs of USD 1000 per FEU, effective January 15. Hapag Lloyd also implemented a GRI of USD1000 per FEU effective January 15, 2015, except for origins India, Sri Lanka, Pakistan, and Bangladesh, which was USD 500 per FEU, effective February 1, 2015. The GRI amounts for all other sizes are as per formula, though formulas for 20′ container size vary by carrier.

The TSA’s fifteen member carriers are: American President Lines, China Shipping Container Lines, CMA CGM, COSCO Container Lines, Evergreen Marine, Hanjin Shipping, Hapag-Lloyd AG, Hyundai Merchant Marine, “K” Line, Maersk Line, Mediterranean Shipping, NYK Line, OOCL, Yang Ming Marine, and Zim Integrated Shipping Services. The group’s web site at www.tsacarriers.org provides additional information; however, each carrier maintains its own tariffs and controls its own pricing. The TSA Carrier group only issues recommended guidelines to its member carriers. Website addresses for all carriers are listed on www.fmc.gov.

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TSA Westbound Carriers Implement GRIs Effective February 1, 2015

Several members of the Transpacific Stabilization Agreement Westbound (TSA), FMC Agreement No. 011223, whose member carriers serve the USA/East Asia trade lanes, implemented General Rate Increases (GRIs) that were filed in their FMC tariff rules during December 2014. The GRI was for USD 80 per 20ft dry container and USD 100 per 40ft dry container, effective February 1, 2015. However, APL postponed the effective date until March 1, and OOCL postponed until April 1. COSCO adjusted the amounts of the GRI effective February 1, and filed a new GRI for March 1, 2015. GRI amounts for reefer containers vary by carrier.

For more information, visit www.tsa-westbound.org.

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