FMC Chairman Lidinsky Reappointed to Post, Appears Before Senate Committee
Federal Maritime Commission (FMC) Chairman Richard A. Lidinsky recently appeared before the U.S. Senate Committee on Commerce, Science, and Transportation to seek consideration of his reappointment to the post of FMC Chairman. In February 2012, President Barack Obama reappointed Lidinsky to serve as a FMC Chairman. Lidinsky, an attorney and international trade consultant, is a maritime industry veteran and former FMC attorney. If his appointment is confirmed in the Senate, his new term will expire June 2017.
Lidinsky began his career at the Federal Maritime Commission in 1973 as Legislative Counsel in the Office of General Counsel. He returned to the agency in 2009 after nearly 35 years. At the recent committee hearing, Lidinsky touted the “regulatory relief” achieved though Non-Vessel-Operating Common Carrier (NVOCC) Negotiated Rate Arrangements (NRAs) regulation. He also highlighted the Commission’s work to assist in the smooth recovery of the shipping industry from the economic downturn and to encourage sustainable port growth. Lidinsky noted that his top priorities for his new term will be “(1) working to ensure our maritime transportation system efficiently supports export growth, and (2) continuing to provide regulatory relief so that companies can hire American workers.”
FMC Commissioner-Nominee Doyle Appears Before Senate Committee, Brennan Leaving
In February 2012, President Obama nominated William P. Doyle to serve as a Federal Maritime Commissioner. Doyle recently appeared before the U.S. Senate Committee on Commerce, Science, and Transportation seeking consideration of his nomination. If confirmed in the Senate, Doyle will join the FMC from the Marine Engineers’ Beneficial Association (MEBA) where he currently serves as Chief of Staff. Doyle is a graduate of the Massachusetts Maritime Academy, where he received a Bachelor of Science in Marine Engineering. He attended law school at Widener University in Pennsylvania. Doyle’s term as FMC Commissioner would expire in June 2013.
Doyle would replace long-time FMC Commissioner Joseph Brennan whose term is now expired. Brennan, who has been serving as an FMC Commissioner since 1999, is known as a vocal and colorful critic of FMC decisions. He was a strong supporter of the Los Angeles/Long Beach Clean Trucks Programs, and called the FMC’s decision to block the programs a “colossal mistake.” In mid-2008, in response to congressional criticism, he called the agency a “four-headed monster.” Most recently, in 2011 he criticized proposed-FMC action that would increase cruise passenger financial protections stating it would be perceived as industry-friendly regulation. Brennan believes that “the shipping statutes and regulations are meant to ensure fair competition and consumer protection,” and has often also criticized the Commission’s deregulatory efforts as outside the scope of the agency’s powers.
FMC Considers Negotiated Rate Arrangements, Freight Indices at May Meeting
The Federal Maritime Commission discussed a number of important issues at a Commission meeting held May 16, 2012. In the open session meeting, the agenda included a briefing and discussion of container freight indices for U.S. agricultural export commodities. The Commission also held briefings on the Committee on the Marine Transportation System (CMTS), and the XXI Latin American Congress of Ports Conference. At the meeting, the Commission discussed a potential Notice of Inquiry regarding container freight indices for U.S. agricultural export commodities. This official notice was issued on May 21, 2012 under FMC Docket No. 12-07. Agency staff also made recommendations regarding revising the NVOCC NRA regulations; a proposed rule for this will likely be issued in the coming months. The next Commission meeting is scheduled for July 18, 2012.
TSA Carriers Increase Surcharges Effective July 1, 2012
Carrier members of the Transpacific Stabilization Agreement (“TSA”), FMC Agreement No. 011223, serving the East Asia/USA will increase several surcharges effective July 1, 2012 and impose a Peak Season Surcharge effective June 10, 2012.
The TSA’s New Formula Bunker Adjustment Factor (“BAF”) for the July to September 2012 quarter, with adjustment for slow steaming, will increase to US$ 580 per 40′ container to U.S. West Coast Ports and US$ 1119 per 40′ container to U.S. East and Gulf Coast Ports, with other sizes as per the formula. Inland Fuel Charges (“IFC”) for the same quarter will increase to US$ 380 per container for shipments to IPI destinations served via West Coast Ports, US$ 190 per container for shipments to RIPI destinations, and US$ 110 per container for shipments to Group 4 Points and to East Coast local store door points. The Currency Adjustment Factors (“CAF”) for the same period will be reduced to 20 percent for shipments from Japan.
The TSA Carriers have also filed a Peak Season Surcharge (“PSS”) which will be effective June 10, 2012 as follows: US$ 480 per 20′ container, US$ 600 per 40′ container, US$ 675 per 40′ hi-cube container, and US$ 760 per 45′ container. PSS amounts for LCL vary. The TSA’s 15 carrier members are: American President Lines, CSCL, CMA-CGM, COSCO Container Lines, Evergreen Marine, Hanjin Shipping, Hapag-Lloyd Container Line, 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.
WTSA Carriers Announce Seasonal Rate Actions and Adjust Surcharges
The Westbound Transpacific Stabilization Agreement (“WTSA”), FMC Agreement No. 011325, whose member carriers serve the U.S. export trades from the USA to East Asia, announced adjustments to current Currency Adjustment Factors (“CAF”), Bunker Adjustment Factors (“BAF”) and Inland Fuel Charges (“IFC”) effective July 1, 2012. Some TSA Carriers have also filed General Rate Increases (“GRIs”) effective July 1, 2012.
WTSA BAF for the July-September 2012 quarter, with adjustment for slow steaming, will increase to US$ 1280 per 20ft dry container, US$ 1510 per 40ft/45ft dry container, and US$ 2017 per 40ft/45ft reefer container for shipments from and via U.S. Atlantic/Gulf Coast Ports. BAF for shipments from or via U.S. Pacific Coast Ports will increase to US$ 630 per 20ft dry container, US$ 787 per 40ft/45ft dry container, and US$ 1113 per 40ft/45ft reefer container. The IFC for the same period is increased to US$ 380 per container for rail and intermodal rail/truck shipments and US$ 110 per container for local/regional truck shipments. CAF for the same period will be 7 percent for Taiwan and 22 percent for Singapore.
Some WTSA carrier members have also announced GRIs for rates covering dry commodities, frozen and chilled meat products, and animal hides. For dry cargo (excluding cotton and hides), carrier members have filed GRIs of US$ 50 per 40-foot container (FEU) for shipments from Los Angeles, CA and Oakland, CA, and US$ 100 per FEU for shipments from Tacoma, WA, USEC ports, and IPI points in the United States. GRIs for chilled or frozen meats have been filed at US$ 300 per FEU from the U.S. West Coast and US$ 400 per FEU for intermodal cargo and U.S. East Coast all-water shipments, with proportionate increases for other equipment sizes. Rates for hides are to be increased by US$ 100 per container. All GRIs are effective July 1, 2012.
WTSA is a voluntary discussion and research forum of 10 container shipping lines serving the trade from ports and inland points in the U.S. to destinations throughout Asia. The WTSA’s 10 member carriers are American President Lines, COSCO Container Lines, Evergreen Marine Corp., Hanjin Shipping, Hapag-Lloyd Container Line, Hyundai Merchant Marine, “K” Line, NYK Line, OOCL and Yang Ming Marine. For more info visit www.wtsacarriers.org.
Trans-Atlantic Carriers Announce General Rate Increases Effective July 1, 2012
Several carriers have announced General Rate Increases (“GRIs”) in the Transatlantic (to/from USA – Europe) trade lanes effective on July 1, 2012. OOCL has announced a GRI for all Westbound and Eastbound dry and reefer cargo between Europe and the United States of US$ 400 per 20′ container and US$ 500 per 40’/45′ container, and a GRI of US$ 450 per 20′ container and US$ 600 per 40’/45′ container for all cargo moving between Europe and the United States via Canadian ports. Hapag Lloyd has also filed a GRI of US$ 400 per 20′ container and US$ 500 per 40′ container for Westbound cargo in the North Atlantic Trades, including movements to U.S. Destinations via Canadian Ports. Maersk Line has announced GRIs to and from North America and Europe for both dry and reefer shipments of US$ 260 per 20′ dry container, US$ 450 per 40′ dry container, and US$ 500 per 40′ high cube reefer container for shipments to/from the U.S. East Coast, and US$ 400 per 20′ dry container, US$ 500 per 40′ dry container, and US$ 550 per 40′ high cube reefer container for shipments to/from the U.S. West Coast.