The recent Federal Maritime Commission report on free time and demurrage fees shows that the agency already has enough information to take action, said dozens of industry groups in an April 27 letter to FMC Chairman Mario Cordero (here). The agency's report, released earlier this month (see 1504140014), outlined several paths of action, but asked for additional industry input. While the report provides a "good foundation," the FMC should "take action to address these issues," said the groups, including the National Customs Brokers and Forwarders Association of America and the Consumer Electronics Association.

The Federal Maritime Commission released the transcript from the April 13 agency meeting that included discussion of detention and demurrage fees (here). The FMC released a related report on the subject earlier this month (see 1504140014).

The Federal Maritime Commission will meet on April 13 at 10 a.m. to discuss "rules, rates, and practices relating to detention, demurrage, and free time for containerized imports and exports moving through selected U.S. ports" and other issues, the agency said (here). The meeting will be a closed session, the agency said.

As U.S. ocean commerce continues to expand, there's a growing need to fund improvements to port infrastructure, Federal Maritime Commission Chairman Mario Cordero told the Congressional Ports Caucus, said a FMC press release (here). The recent problems with port congestion point to insufficient funding and the need for use of the Harbor Maintenance Trust Fund, he said. "The thousands of containers that are discharged at one time from such vessels presents a huge challenge to terminal operators and port drayage truckers," he said. "The difficulties in the handling of such container volumes also exacerbates problems caused by insufficient chassis availability, trucker shortages, and lack of adequate investment in port-related infrastructure." There's been complaints to the FMC across all sectors, including spoilage of whole perishable shipments that could not be loaded in time for export, he said. The FMC "is doing what it can to help resolve congestion issues, including its grant of a request by the Ports of Los Angeles and Long Beach for expedited review of an amendment to their cooperative working agreement permitting them to address the systemic causes of port congestion," he said.

Congestion issues at West Coast ports caused container terminals at the Port of Long Beach to move 20 percent fewer containers in February compared to the same month in 2014, said the port on March 17 (here). Imports were down 24.7 percent at the Port of Long Beach, and exports fell 22.9 percent. Empty containers moving overseas fell by 3.9 percent, it said. Although February marked the third straight month of drastic declines in containers moving through the port, the outlook for the future is rosier on account of the deal struck in February by longshoremen and West Coast ports (see 1502230002), said the Port of Long Beach. Also contributing to congestion relief going forward is the approval of a deal between the Ports of Long Beach and Los Angeles to collaborate on congestion relief, and private chassis fleets in the region reaching an agreement to pool their resources, said the port.

The Federal Maritime Commission should request that the four major shipping alliances "provide new information on the steps each is taking to reduce congestion at U.S. ports," said FMC Commissioner Michael Khouri (here). "In terms of overall costs and service levels in the liner supply chain as experienced by U.S. exporters and importers, there has been a deterioration in service and significant increase in costs due to several factors," he said. Loading practices at Asian ports have allegedly resulted in the need for "additional intra-facility ground moves to and among each of the local terminals operated by the individual alliance members before the container is dispatched out of the port complex," said the press release. The FMC approved the alliances as long as "the alliance agreement will not produce unreasonable reductions in transportation service or unreasonable increase in transportation cost," it said.

A weeklong “longshore contract caucus" opens March 30 in San Francisco, where 90 “delegates” representing the 29 West Coast ports will vote up or down whether to send a contract proposal on to the 13,000 International Longshore and Warehouse Union members for secret balloting with a positive recommendation, said union officials. They wouldn’t speculate how long the balloting process might take. The IWLU reached a tentative labor deal with the Pacific Maritime Association last month (see 1502230002). Despite the agreement, workers from ILWU's Local 10 were dismissed from the Port of Oakland March 9 and 11 "after they refused to work due to a dispute over staffing levels," according to the port (see 1503120022). Representatives at ILWU’s central headquarters in San Francisco referred queries to Local 10 President Melvin MacKay, who did not respond to requests for comment.

Port shutdowns caused by labor-management disputes continued at the Port of Oakland March 9 and 11, despite a tentative deal reached in February between the International Longshore and Warehouse Union and the Pacific Maritime Association (see 1502230002). The Oakland International Container Terminal, one of five at the port, sent longshoremen home early on March 11 “after they refused to work due to a dispute over staffing levels,” according to an update on the Port of Oakland website (here). The same terminal also had a “labor-management staffing issue” on March 9 that resulted in import containers not being “available for pick-up.” All marine terminals, including the Oakland International Container Terminal, were back open as of 9:25 a.m. PDT on March 12, according to the Port of Oakland.

Skullcandy spent more than $1.1 million on air freight in Q4 to circumvent the West Coast ports slowdown and deliver headphones and other consumer products to retail for the crucial holiday selling season, Chief Financial Officer Jason Hodell said March 5 on an earnings call. For Q4, the company also estimates it had about $3 million worth of inventory sitting “unfortunately idle” at the port of Seattle while the labor slowdowns continued, Hodell said. “Without the port slowdown, this inventory would likely have been consumed in Q4,” he said. As the West Coast ports crisis wasn’t resolved until the breakthrough in contract negotiations in late February and backlogs were expected to continue for weeks thereafter (see 1502240004), Skullcandy anticipates incurring additional air freight costs that will reduce earnings per share by at least a penny when it reports Q1 results, he said. But "this is a short-term issue,” he said.

The Panama Canal expansion project will help pave the way for more U.S. trade with Asia, a trend expected to continue if a Trans-Pacific Partnership is finalized, by offering an alternative shipping route to the Suez Canal, said panelists at the International Chamber of Commerce and U.S. Council for International Business symposium on Feb. 24 in Miami. The expansion will allow ships to pass through with more than 14 ft. in depth, said one expert, as well as 13,000 twenty-foot equivalent units in size (see 14022816).