West Coast Situation – Update 1
January 15, 2019
Dear Valued Customer,
As we continued to dig out from the unprecedented volumes discharged in US ports during the course of time prior to the Lunar New Year, we are experiencing heavy congestion, especially in the ports of Los Angeles and Long Beach.
Because of the congestion and extra vessels calling LAX/LGB, there have been overall labor shortages. The Pacific Maritime Association (PMA) has implemented work gang allocations. Vessels are waiting 2-3 shifts after arrival prior to receiving labor and what is allocated is based on ship size. This delays cargo availability, extends the vessels at berth and causes bunching of vessels as they are delayed leaving the area.
The chassis pool of pools (PoP) has increased to 68,000 but chassis supply remains constrained due to the amount of imports and importers keeping containers and chassis in their yards longer than average.
Import Container Dwell Times
As noted, importers are holding containers longer than average. Average on the street dwell time has increased to 7 days. This is an increase of 3 days over normal periods.
As terminals are trying to cope with these import flows having issues evacuating containers due to chassis issues, their congestion issues worsen as they start to face gridlock. Terminals are maxed out space-wise and the normal flow of appointments is being interrupted as they simply have too much in certain areas of their yards to be able to work. Some terminals are refusing to accept empties from carriers they try to dig out of the volumes they have on-dock.
Given the flow of cargo and the congestion, truckers are in high demand which leads to difficulties when allocating drivers, making it difficult to get containers out of terminals.
Railcar supply is also challenged, which forces terminals to change many destinations from on-dock to off- dock. This means that containers need to be trucked out of the port, putting more pressure on trucker and chassis supply.
All these factors contribute significantly to the challenges that we are experiencing in Los Angeles and Long Beach. We are asking and encouraging all our customers to pick up their containers as soon as possible, upon availability and return the chassis and empty container as quickly as possible. The more chassis we have in the pool to evacuate loads, enables us to begin to clear up this congestion and return to normal operating procedures.
As a reminder, for all containers that charges incurred due to containers staying in the port too long, or not being returned in a timely manner, will be for the account of the importer of record.
Source: www.cma-cgm.com CUSTOMER ADVISORY #12-011519 Update 1
Hapag-Lloyd Crew Evacuated from Fire-Stricken Yantian Express
Hapag-Lloyd has evacuated the crew of the containership Yantian Express after the fire aboard the vessel increased in intensity.
Namely, the shipping firm said that the ship’s crew of 8 officers and 15 seafarers “is unharmed and was safely transferred” to the salvage tug Smit Nicobar on January 5 and 6.
“Due to bad weather conditions, the fire has not been successfully contained yet and has significantly increased in intensity at times,” Hapag-Lloyd said, adding that firefighting support at the site is ongoing.
The fire broke out on January 3 in one container on Yantian Express’ deck and spread to additional containers.
“At this time, it is not possible to make a precise estimate of any damage to Yantian Express or its cargo,” the company continued.
The 7,510 TEU Yantian Express was on its way from Colombo to Halifax via the Suez Canal when the fire started. The ship is currently around 800 nautical miles off the coast of Canada, Nova Scotia.
MSC Zoe Loses Up to 270 Containers Overboard in North Sea
January 2, 2019 by Mike Schuler
The Dutch Coastguard has issued a navigational warning after an ultra-large containership lost scores of containers while underway in the North Sea.
The ship, MSC ZOE, was in German waters when it lost the containers in heavy seas between Vlieland, Netherlands and the German Bight in the southeastern North Sea on New Year’s Day.
The Coastguard initially reported about 30 containers lost. However, an update Wednesday morning said it now understands that a whopping 270 containers went overboard.
Photos released Wednesday by Germany’s Havariekommando shows toppled boxes both fore and aft of the ship’s superstructure:
The Coastguard is warning ships in the vicinity keep an eye out for containers floating in the water.
At least 21 containers with loose goods have washed up on the Dutch islands of Vlieland, Terschelling and Ameland.
The MSC ZOE was underway from Antwerp, Belgium to Bremerhaven, Germany at the time of the incident.
Delivered in 2015, the 396-meter-long MSC Zoe ranks among the world’s largest containerships with a carrying capacity of 19,224 TEU.
The contents of all lost containers has not been confirmed, however at least three are reported to contain hazardous materials.
The Coastguard is warning the public not to handle or approach any of the containers.
A Challenge to Shippers Who Would Never Dream of Controlling the Insurance
Shippers who rely on suppliers to furnish cargo insurance or who rely on their carriers to take responsibility for losses may be in for a big surprise. Protecting your investments by insuring your goods provides peace of mind.
Buying CIF: Who’s really responsible if your product is lost or damaged in transit? According to internationally accepted trade terms, referred to as Incoterms, suppliers selling “CIF” (Cost, Insurance, Freight) are responsible for arranging cargo insurance. But just because your supplier has the obligation to arrange insurance under CIF terms, it doesn’t mean that they are ultimately responsible if your product is lost or damaged during transit. The ultimate burden of loss falls upon you, the buyer. This is why many experts recommend importers change their buying terms to EXW, FOB, FCA, CFR or similar terms in order to control the selection, and thereby the quality, of insurance coverage.
How much is that insurance really costing you? Foreign suppliers and their forwarding agents often tack on placement fees to the insurance costs. Those added fees often inflate the cost of insurance well beyond market pricing for the same coverage purchased in the United States. Find out how much you’re really paying and then compare quotes received from BOC International.
Is the coverage your supplier purchased for you adequate? Importers relying on their suppliers to arrange insurance run the risk of having inadequate insurance coverage. Cargo insurance policies can vary widely in levels of coverage, deductibles and special restrictions. Ask your supplier for a complete copy of the insurance policy or for a certificate of insurance detailing all the policy terms and conditions
What’s the financial health of your supplier’s insurance company? Recent financial and catastrophic events have exposed the vulnerability of insurance companies to sudden economic devastation. Importers are encouraged to make certain their suppliers use insurers with a favorable financial rating supplied by a respected financial rating service. A.M. Best, Standard & Poor’s and Moody’s are among some of the world’s most respected. BOC’s insurance company, underwriters at Lloyd’s of London, has an A.M. Best financial rating of A (Excellent).
How will your claim be handled? If insurance is arranged overseas, will you be forced to deal with an inexperienced, sub-contracted independent adjuster unfamiliar with the assessment of transportation related losses? Ask your supplier for a list of insurance claims adjusters contracted by the insurance company. Adjuster and surveyor networks approved by Lloyd’s of London and AIMA are among the most credible. BOC has a vested interest in your insurance needs and will directly handle cargo claim documentation requirements to ensure prompt processing and timely settlement.
Every Shipper Needs Cargo Insurance
Global trading involves risk; however, broad insurance coverage minimizes your financial risk. Don’t leave your livelihood up to chance! Statistics show that one ship sinks each day and you will experience a General Average loss every eight years. If you are depending on the carrier to cover losses, their responsibility is limited by law as follows:
Ocean Carriers $500 per shipping unit
A shipping unit may be defined as one ocean container.
Air Carriers $9.07 per pound
Truckers $.50 per pound
The insurance we offer is competitively priced and insures approved merchandise against physical loss or damage from external causes. By purchasing cargo insurance, you can avoid inconvenience and frustration. Contact your BOC Representative at 617-345-0050 for your free quote.