Delays at North America’s West Coast Ports

Back in September, Cole International published an article called “Know the Risks, International Trade & Transportation”.  The overall message in the article was – even though you have taken all necessary precautions upfront, there are still things beyond anyone’s control that can affect the timeliness of a shipment.

This is exactly where we find ourselves today – in a situation, out of our control that has created significant delays in receiving and sending international shipments.   There is extreme congestion at North America’s west coast ports which is being experienced for a number of reasons. The Canadian International Freight Forwarders Association (CIFFA) reports:

“A variety of causes have converged to create chaos and congestion at US and Canadian West Coast ports.    Labour negotiations between the ILWU and the Pacific Maritime Association are ongoing and negatively affecting all US west coast ports. Right now discussions have been postponed for 12 days due to the American Thanksgiving. Severe chassis shortages and trucking problems at Long Beach and Los Angeles add to the tension and delays. US destined cargo has been diverted north to Port Metro Vancouver and Prince Rupert. Congestion in Asia ports, larger vessels that take longer to handle in ports, and storms in the Pacific wreak havoc with vessel schedules. Some vessels are arriving 10 to 12 days late at Canadian and US ports.   Dozens of vessels are anchored at ports waiting, sometimes for weeks to discharge. Volumes have not been this high in over 2 years.”

There is significant impact to the international trade community as a whole.  CIFFA reported:

Exports are being delayed 

  • Across North America, exports are being severely hampered.  As vessels try to pick up time in their schedules, they discharge inbound containers and immediately depart, not waiting to load exports. In many cases, loaded export containers are being held at inland rail receiving terminals or held off-dock. 
  • Terminals are full and there is no room on the docks for empty containers that need to be evacuated back to Asia.  Vessels are not waiting to load empties.

Expect equipment shortages in Asia.  

  • Every week that goes by with thousands of containers landing in North America and few being returned to Asia, the problem worsens.  Soon we expect that the imbalance will be such that December and January exports from Asia will suffer as there won’t be sufficient numbers of containers there to load.

Expect even more surcharges.  

  • It costs money to keep vessels at anchor for days waiting to discharge and to manage container imbalances.  Carriers are beginning to implement congestion surcharges.  For example, on Friday MSC has announced that, “With several weeks of slowdown on U.S. West Coast port operations, our vessels are being worked at a slower pace, extending the stay at the port, which consequently leads to other vessels having to wait a significant number of days outside the port. Consequently, a costly recovery program, including a multitude of services, has been orchestrated to lessen the delay of U.S. exports, Asia exports and flow of equipment into Asia.” It added that it wished “to recover our expenses and mitigate our potential loss of revenue, and shall, therefore, effective Nov. 26, 2014 (gate-in date) charge a Port Congestion Surcharge. The amount of the surcharge is $800 per TEU, $1,000 per FEU and $1,125 per high-cube container”.  Other carriers are following suit. This surcharge could seriously affect freight forwarders’ treasuries and could substantially increase credit liabilities/ risk.  

Airfreight is not necessarily the answer. 

  • With weeks of delay in ocean freight, shippers desperate to have product on shelves for Black Friday and the Christmas retail season have diverted thousands of tons of ocean freight to air. Scheduled carriers are flying full and air charter rates inbound from Asia are through the roof.
  • Importers who are trying to negotiate air cargo inbound from Asia during the next several weeks must be advised of realistic transit times, possible booking delays and cost expectations.”

What to expect & what you need to know:

  1. These delays are totally beyond the control of Cole (or CIFFA) and there is no course of claim or cost recovery for increased fees, demurrage, detention, storage or surcharges.
  2. As Cole is made aware, we will communicate with our clients, any new or increased carrier surcharges or cost recovery programs.
  3. Delays of up to 3 weeks at West Coast ports are imminent.
  4. Be prepared for continued delays into 2015, and possible further delays with associated escalating costs until ILWU settles their labour contracts, productivity is stabilized and operations return to normal.
  5. Prepare for a strong peak Chinese New Year (CNY) season (Jan-Mar), with heavy volumes through West Coast ports including Canada.

This is an unfortunate situation, but it is important that you stay informed to enable you to make important business decisions that lie ahead.  Cole will monitor the situation closely and will publish information on the latest developments at the West Coast ports as it becomes available.

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Important Deadline, USA Bound Food Products

Background:

The Food and Drug Administration (FDA) Food Safety Modernization Act (FSMA), signed into law on January 4, 2011, enables FDA to better protect public health by strengthening the food safety system.

The Issue:

A significant deadline for “food facilities” is fast approaching.  Among many other changes, FSMA amended Section 415 of the Federal Food, Drug, and Cosmetics Act (FD&C Act) [21 U.S.C. § 350D], which requires domestic and foreign facilities that manufacture, process, pack or hold food for human or animal consumption in the U.S. to register with FDA. Under FSMA, all food facilities that are required to register with FDA under Section 415 of the FD&C Act must renew their registrations with FDA, every other year, during the period of time beginning on October 1 and ending on December 31 of each even-numbered year.

Consequence of Non-Compliance:

Beginning on January 1, 2015, if a foreign food facility is required to register with FDA, but fails to do so, food from that facility that is being imported or offered for import into the U.S. is subject to be held under Section 801(l) of the FD&C Act.

Food Facility Registrations (FFR) that are not renewed by December 31, 2014 will be subject to invalidation of registration and could result in food shipments manufactured by those facilities without valid registrations to be held at the port upon arrival in the U.S.

More Information:

For more information on the FDA food facility registration requirement, see FDA’s website at:http://www.fda.gov/Food/GuidanceRegulation/FoodFacilityRegistration/default.htm. For assistance with registration issues contact FDA Industry Systems Help Desk at 800-216-7331 or 301-575-0156. For assistance via email, utilize the form on FDA’s website http://www.accessdata.fda.gov/scripts/email/cfsan/bioterrorismact/helpf2.cfm

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Date limite importante, Produits alimentaires destinés aux É.-U.

Contexte :

La Food and Drug Administration (FDA) Food Safety Modernization Act (FSMA), passée le 4 janvier 2011, permet à la FDA de mieux protéger la santé publique en renforçant le système de sécurité alimentaire.

Le problème :

Une data limite importante pour les « installations alimentaires » approche à grand pas.  Parmi d’autres nombreux changements, la FSMA a modifié la Section 415 de laFederal Food, Drug, and Cosmetics Act (FD&C Act) [21 U.S.C. § 350D], qui exige que les installations qui produisent, traitent, emballent ou entreposent de la nourriture destinée à la consommation humaine ou animale aux É.-U. soient enregistrées auprès de la FDA. Conformément à la FSMA, toutes les installations alimentaires qui doivent s’enregistrer auprès de la FDA dans le cadre de la Section 415 de la FD&C Act doivent renouveler leurs inscriptions auprès de la FDA, tous les deux ans, au cours de la période s’écoulant du 1er octobre au 31 décembre de chaque année dont le nombre est pair.

Conséquences en cas de non respect :

À partir du 1er janvier 2015, si une installation alimentaire étrangère doit s’enregistrer auprès de la FDA mais manque de le faire, la nourriture provenant de cette installation, qui est importée ou offerte à l’importation dans les É.-U. sera sujette à une saisie, conformément à la Section 801(l) du FD&C Act.

Les Food Facility Registrations (FFR) qui ne sont pas renouvelées avant le 31 décembre 2014 seront sujettes à une invalidation d’enregistrement, ce qui pourrait alors entraîner une saisie des cargaisons de la nourriture fabriquée par ces installations sans enregistrements valides lors de leur arrivée aux É.-U.

Plus de renseignements?

Pour plus de renseignements au sujet des exigences d’enregistrement des installations alimentaires de la FDA, consultez le site Web de la FDA sur :http://www.fda.gov/Food/GuidanceRegulation/FoodFacilityRegistration/default.htm. Pour obtenir une aide par rapport aux problèmes d’enregistrement, veuillez contacter l’Assistance des Systèmes d’Industrie de la FDA au 800-216-7331 ou 301-575-0156. Pour obtenir de l’aide via courriel, utilisez le formulaire sur le site Web de la FDA http://www.accessdata.fda.gov/scripts/email/cfsan/bioterrorismact/helpf2.cfm

Cole International Supports Canadian Cancer Society

wanted photoCole International is proud to have participated in the Canadian Cancer Society’s 2014 Jail’n Bail on Tuesday, October 7th, by requesting our Executive VP, COO – Kyle Johnston be arrested in support of the cause.  Kyle’s original bail was set to $1,500, however throughout the week leading up to the event and the day of, his final bail was determined by the judge and set at $3,750.  Mr. Johnston reached his bail before being released and surpassed it raising over $5,000 through donations made online and in person.

The fundraiser’s goal is set to raise $50,000 between four city’s in Alberta that participate (Calgary, Red Deer, Edmonton, Lethbridge) and as of today, the Canadian Cancer Society has raised over $90,000 through online donations and the total continues to climb. Cole International would like to thank and congratulate all those that work so hard to make this fundraiser a success each year, our COO for being such a good sport during the event and all those friends and family that donated to such an important cause.

Visit the Calgary Sun Jail’n Bail article for pictures from the event.

Vehicle Exports from USA, “Informed Compliance Period” Over

As previously reported (April 5, 2014), the U.S. Census Bureau implemented mandatory filing of export information through the Automated Export System (AES) for ALL shipments of USED SELF-PROPELLED VEHICLES from the USA to Canada. See full story at: http://www.cole.ca/news/new-requirements-for-vehicle-exports-from-usa/ 

Subsequent to the April 5, 2014 implementation, the U.S. Census Bureau and U.S. Customs & Border Protection (CBP) agreed to provide an additional 180 days for exporters to come into compliance with the new requirements.  During this 180 day period the Census Bureau and CBP would use “informed compliance” to educate the trade community on the new requirements. During this time, no penalties would be issued for failure to comply with the new requirements. Informed Compliance means that rather than issuing penalties, they would coach and counsel exporters on how to become compliant. See update to original story at: http://www.cole.ca/news/update-to-new-requirements-for-vehicle-exports-from-usa/

September 25, 2014 Update: 

The 180 day informed compliance period is over on October 2, 2014.  This means that the CBP will begin to issue penalties for non-compliance with the AES Filing requirement.  Penalties for non-compliance can be significant, up to $10,000.00, so it is imperative that you are prepared!

How can Cole International help?

For both commercial and individual importers, Cole International provides a full range of services to ensure that your vehicle import (and export) goes smoothly. We can:

  • Arrange for transportation (if required)
  • Apply for and monitor the U.S. ’72 hour requirement’
  • File the NEW MANDATORY U.S. Census Bureau information on your behalf
  • Provide a vehicle import account, including Import Business Number
  • Pay all applicable duties and taxes
  • Prepare and remit all the necessary paperwork before your vehicle arrives at the border
  • Prepare RIV forms, pay RIV fees, remit recall letter, monitor & secure RIV Form 2

For more information:

Debbie Jo Willard - Vehicle Imports – Calgary, AB  403-219-2289

Ken Campbell - Manager, Vehicle Imports – Calgary, AB  403-514-7438

Garry Reynolds - Branch Manager – Lacolle, QC  450-246-3950

Wayne Willis  – Vehicle Import Compliance Specialist – Emerson, MB –  204-373-2549

 

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