Did you know:

• Many carriers will not take responsibility for loss or damage if a warehouse signs off clean on a POD, so it is important, before signing off, to note the condition of the cargo. Claims are usually time-barred, unless filed within a few days (standards vary by carrier). So alert your carrier to possible damage immediately. The best way to do this is by signing the delivery receipt notating damage! And be specific, for example, 8 glasses broken, 10 boxes crushed (Make ensure that you have the correct boxes or pallet count).

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.

According to internationally accepted trade terms, referred to as Incoterms, suppliers selling CIF 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 control the selection, and thereby the quality, of insurance coverage.

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.

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

Importers are encouraged to make certain their suppliers use insurers with a favorable financial rating supplied by a respected financial rating service. BOC’s insurance company, underwriters at Lloyd’s of London, has an A.M. Best financial rating of A (Excellent).

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.

Are you familiar with GENERAL AVERAGE?

There are a number of notable fire cases, with many resulting in General Average!

• Ever Given – April 2021
• Sincerity Ace – January 2019
• Maersk Honam – March 2018
• Maersk Kensington – March 2018
• Hyundai Auto Banner – May 2018
• MOL Prestige – February 2018
• Caribbean Fantasy – June 2018

General Average

• Basic principle – that which has been sacrificed for the benefit of all shall be made good by the contribution of all.
• Applies to maritime claims only.
• Is declared by the captain when there is imminent danger to the vessel, voyage or crew.
• You are contractually obligated, via the Bill of Lading, for unknown and undetermined costs. 

How does it work?

• Value of the voyage is determined (vessel value plus value of all cargo on the vessel.)
• Participation is determined by the percentage that the value of your cargo bears to the overall value of the voyage.
• The loss amount is determined, and participation percentage is applied to the loss amount to determine security deposit.
• Shipper or their cargo insurer pay twice – first for the initial contribution, then for a bond covering future adjustments to that estimate.

Hidden Costs

• LCL Freight – Freight is not released until all payments received.

Difficulties of preventing and extinguishing fires on the open sea, include:

• Ships are larger with more varied cargo.
• Crew are ill equipped to deal with these fires.
• Fire-fighting tugs are often days or weeks away.
• Prevention is difficult, with rising problems with mis-declared cargo.
• IMDG Code is evolving to impose stricter rules on dangerous goods (DG.)

Problems Facing the Industry

• Stricter rules on DG will lead to higher costs and more incentive on the part of shippers to avoid proper declarations
• Ship owners and shipbuilders need to improve fire-fighting capabilities with CO² systems being shown to be inadequate – cost benefit analysis
• National Cargo Bureau in NY found in 2017 that of 1,721 stowage plans inspected, 20% showed errors with DG

General Average will never go away

• Awareness across all business units that losses & delays are part of any supply chain. Mission-critical shipments need more risk analysis to determine transport mode.
• Understanding of what to do when General Average occurs. This is best led by your cargo insurance provider meeting with your ‘team,’ not just the risk manager or CFO.
• Have a contingency plan or at least an understanding of how the event will unfold.

U.S. to Ban Goods Made In Xinjiang, China

Under a new law, the U.S. will ban imports of all goods made in whole or in part from any good from the Xinjiang Uyghur Autonomous Region in China, effective June 21, 2022. Companies need to use the next 180 days to ensure their supply chains do not include such goods.

Sandler, Travis & Rosenberg, P.A., has developed a program to help companies review their supply chain visibility in response to this new law.

For more information on this program, please contact Elise Shibles (at (415) 490-1403 or via email eshibles@strtrade.com), Amanda Levitt (at (212) 549-0148) or via email alevitt@strtrade.com), or David Olave (at (202) 730-4960 or via email dolave@strtrade.com).

BOC NOTE: Xinjiang should not be confused with the common coastal port named Xingang (Tianjin). Xinjiang is 2,000 miles inland from Xingang/Tianjin/Yellow Sea. 

LA/LB Port Update- New Fee

The details are being finalized but the current plan is for the terminal to bill the ocean carrier. In the end, the ocean carrier will likely bill the cost to the importer directly or increase the ocean freight to cover the fees. Similar to demurrage, detention, excess chassis fees and now these new charges, everything is getting dumped on the importer. It is unfair but it is what is currently happening in the marketplace.

Until the world governments can step up or until the advantage goes back to the importer when the demand is not so strong, the carrier and terminal will continue to be king and put everything back on the importer. We are suggesting for all importers to contact your congressional representatives and voice your concern.

Chart: American Shipper

BOC will continue to monitor this situation and will advise if there are any changes or updates. If you have any questions please feel free to reach out to your BOC representative.

Finally Some Good News for Importers
(Tariff Exclusions)

USTR will start a targeted tariff exclusion process focused on restating previously extended exclusions, most of which expired on December 31, 2020. Per a Federal Register notice inviting public comment attached, USTR will evaluate the reinstatement of each of these exclusions on a case-by-case basis. The 549 exclusions covered by the notice can be found in the link below:

https://ustr.gov/sites/default/files/files/Notices/Section 301 China Request for Comments/Annex of Previously Extended Exclusions for Website.pdf

For additional information on 301 tariffs, please visit the below link of Sandler, Travis and Rosenberg, PA, or contact their attorney who specializes in this area, Paula Connelly.

https://www.strtrade.com/trade-news-resources/tariff-actions-resources/section-301-tariffs-on-china

Paula Connelly, Esquire
mobile phone: (781) 897-1771
pconnelly@strtrade.com

NOTICE OF CHB DELAYS DUE TO UNCERTAIN BERTHING TIMES/LOCATIONS

All steamship lines are experiencing port and berth congestion. Please see notice below received from Wanhai. This explains the late notice brokers are receiving regarding arrival notices, berthing times and locations. Without an accurate arrival notice, Customs Brokers cannot file Customs entry. Please be patient as we all continue to work through these trying times. Rest assured, our CHB teams want to clear your freight as quickly as possible. 

Asia Holidays

Key Asian locations with upcoming holidays, listed below.

China Schedule for Upcoming holidays.

Taiwan Schedule for Upcoming holidays

Thailand Schedule for Upcoming holidays

Malaysia Schedule for Upcoming holidays

Indonesia Schedule for Upcoming holidays

Japan Schedule for Upcoming holidays

India Schedule for Upcoming holidays

DOT Brake Safety Week

Expect fewer trucks on the road, more delays and increased costs

Brake Safety Week Set for Aug. 22-28

This year’s Brake Safety Week is scheduled for Aug. 22-28. During Brake Safety Week, commercial motor vehicle inspectors emphasize the importance of brake systems by conducting inspections and removing commercial motor vehicles found to have brake-related out-of-service violations from our roadways. At the same time, many motor carriers work to educate their drivers and maintenance service providers on the importance of brake system safety.

Throughout the week, inspectors will conduct North American Standard Inspections of commercial motor vehicles, focusing on the vehicle’s brake systems and components. In addition, inspectors will compile data on brake hoses/tubing, the focus area for this year’s Brake Safety Week, to submit to the Commercial Vehicle Safety Alliance (CVSA). CVSA will report its findings later this year.

Jurisdictions devote a week to conducting commercial motor vehicle inspections, identifying brake violations and removing vehicles with out-of-service brake violations because:

Brake system and brake adjustment violations accounted for more vehicle violations than any other vehicle violation category, accounting for 38.6% of all vehicle out-of-service conditions, during last year’s three-day International Roadcheck inspection and enforcement initiative.

“Brake system” was the third most cited vehicle-related factor in fatal commercial motor vehicle and passenger vehicle crashes, according to the Federal Motor Carrier Safety Administration’s (FMCSA) latest “Large Truck and Bus Crash Facts” report.

Brake-related violations accounted for eight out of the top 20 vehicle violations in 2020, according to FMCSA’s Motor Carrier Management Information System.

During last year’s Brake Safety Week, 12% of the 43,565 commercial motor vehicles inspected were placed out of service for brake-related violations.

The dates for Brake Safety Week are shared in advance to remind motor carriers, drivers and commercial motor vehicle mechanics/technicians to proactively check and service their vehicles to ensure every commercial motor vehicle traveling on our roadways is safe, mechanically fit and compliant. Recent research has shown that announcing enforcement campaigns ahead of time improves overall compliance better than surprise enforcement campaigns and for longer periods after the event.

August, the month of CVSA’s Brake Safety Week, is also Brake Safety Awareness Month. Law enforcement agencies will work to educate commercial motor vehicle drivers, motor carriers, mechanics, owner-operators and others on the importance of proper brake maintenance, operation and performance through outreach, education and awareness campaigns.

Source cvsa.org

New COVID Procedures at Shanghai (PVG) Airport

Please be advised that Shanghai Pudong International Airport (PVG) has implemented new COVID-19 measures, as below:

Under the new 7+7+7 or 14+7+7 measures, terminal workers at PVG are required to:

• work 7 or 14 days in the terminal

• complete a 7-day quarantine in a hotel

• complete another 7-day quarantine at home

This arrangement is expected to cause a shortage in manpower that may result in the following:

• Frequent short- or off-loading

• Shortage of staffing

• Longer terminal handling time

• More flight cancellations and shortage of import and export capacity

• Increase in airfreight rates

• Some suspension of trucking, causing major backlogs

• Embargoes for seafood and perishable items

• Screening and disinfecting of some freight

BOC will continue to monitor and advise, as these requirements and restrictions change.

China-U.S. container shipping rates sail past $20,000 to record

By Roslan Khasawneh and Muyu Xu of Reuters

SINGAPORE/BEIJING (Reuters) – Container shipping rates from China to the United States have scaled fresh highs well above $20,000 per 40-foot box as rising retailer orders ahead of the peak U.S. shopping season add strain to global supply chains. The acceleration in Delta-variant COVID-19 outbreaks in several counties has slowed global container turnaround rates. Typhoons off China’s busy southern coast in late July and this week have also contributed to the crisis gripping the world’s most important method for moving everything from gym equipment and furniture to car parts and electronics.”These factors have turned global container shipping into a highly disrupted, under-supplied seller’s market, in which shipping companies can charge four to ten times the normal price to move cargoes,” Philip Damas, Managing Director at maritime consultancy firm Drewry, said. “We have not seen this in shipping for more than 30 years,” he said, adding he expected the “extreme rates” to last until Chinese New Year in 2022.

RATE HIKES

The spot price per container on the China-U.S. East coast route – one of the world’s busiest container lanes – has climbed over 500% from a year ago to $20,804 this week, freight-tracking firm Freightos said. The cost from China to the U.S. west coast is a little below $20,000, while the latest China-Europe rate is nearly $14,000, Freightos’ data shows. Ding Li, president of China’s port association, told Reuters the spike followed a rebound in COVID-19 cases in other countries, which has slowed turnover at some major foreign ports to around 7-8 days. The surging container rates have fed through to higher charter rates for container vessels, which has forced shipping firms to prioritise service on the most lucrative routes. “Ships can only be profitably operated in the trades where freight rates are higher, and that is why capacity is shifting mostly to the U.S.,” said Tan Hua Joo, executive consultant at research consultancy Alphaliner. Some shippers have reduced volumes in less profitable routes, such as the transatlantic and intra-Asia, said Damas. “This means that rates on the latter are now increasing fast.”

NO RESPITE

The rate surge is the latest reflection of disruptions since COVID-19 slammed the brakes on the global economy in early 2020 and triggered huge changes to the flows of goods and healthcare equipment around the world. “Every time you think you’ve come to an equilibrium, something happens that allows shipping lines to increase the price,” said Jason Chiang, Director at Ocean Shipping Consultants, noting the Suez canal blockage https://www.reuters.com/world/asia-pacific/how-giant-container-ship-is-blocking-suez-canal-2021-03-25 in March had played a major role in allowing firms to hike rates. “There are new orders for shipping capacity, equal to almost 20% of existing capacity, but they will only come online in 2023, so we will not see any serious increase in supply for two years,” Chiang added.

(Reporting by Roslan Khasawneh in Singapore and Muyu Xu in Beijing. Editing by Gavin Maguire and Barbara Lewis)