Tuesday, January 5, 2016

Ch-ch-ch-changes


New year, new ballgame – regulatory and competitive environment for shippers will look different in 2016.

The only constant is change, it is said, and that will be true for the world of supply chains in the year ahead. Along with ongoing trends such as the galloping advances in information technology, the continuing move to online commerce, waves of consolidation among freight carriers on land, air and sea, and the plunging price of fuel, with the cost of a barrel of oil slashed in half since mid-2014, these specific changes in the regulatory and competitive environment, reported in the Journal of Commerce, will help keep logistics a roller coaster ride in 2016. Happy New Year!

Container weight mandate
Effective July 1, 2016, in accordance with a new International Maritime Organization regulation, all containers must have verified weight documents if they are to be loaded onto a ship. Too few shippers and government agencies are ready for the major rules, and some details such as enforcement measures and sanctions are still being worked out. There are options to meet the regulations. Shippers can weigh a container on a truck as it passes over a weigh station, subtracting the weight of the truck, chassis and fuel to determine the weight of the loaded container, or weigh each item going into a container and add the sum of all the goods loaded to the tare weight of the container. If the necessary documentation is not provided to the terminal and carrier along with the container, it will not be loaded on the ship.


U.S. Customs’ Automated Commercial Environment
This government mandate for U.S. Customs and Border Protection’s Automated Commercial Environment was pushed back beyond its original date of implementation. ACE is a “single window” that allows shippers to file the array of documents various government agencies require for importing and exporting goods in a single, online portal. The original November deadline has been delayed to February. ACE is expected to lower costs and save time for shippers. Trade groups are urging Customs to make sure the process goes smoothly.

Expanded Panama Canal
The new Panama Canal locks, expected to open in April 2016, will roughly triple the capacity of ships able to transit the waterway, from 5,000 20-foot-equivalent units to 14,000 TEUs. The economies of scale that carriers will gain may be passed on to shippers through lower rates, potentially spurring the latter to shift more cargo from the West Coast to the East Coast. There have been issues, most recently the discovery of leaks in the sill of the Pacific side locks, but the Panama Canal Authority says the repairs won’t impact the scheduled opening. Even if the April deadline is met, the expansion will be a year-and-a-half behind the original opening date of October 2014 and about $100 million over the original budget.

Kirk Shearer
President
TOTALogistix
www.totalogistix.com <http://www.totalogistix.com>  
800-989-0054 x103

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