The air cargo’s current woes are signs of structural changes in the air cargo industry that will likely result in overcapacity for years to come, said Oliver Evans, chief cargo officer at Swiss WorldCargo, in a blog post Nov. 4. Although some await the air cargo industry’s return to the steady growth that characterized the last 25 years, the “awful truth” is beginning to sink in that the industry faces more than a manageable downturn, said Evans. “It is a structural change, or a combination of changes, that runs deep down to the foundations of our industry, threatening all who turn a blind eye to it.”
The Federal Maritime Commission released a notice of the filing of the following agreements under the Shipping Act of 1984. Interested parties may submit comments on the agreement to the Secretary, Federal Maritime Commission, Washington, DC 20573, within 10 days.
The Maritime Administration plans to hold a National Maritime Strategy Symposium to discuss "Cargo Opportunities and Sealift Capacity," the agency said. The symposium is scheduled for Jan. 14-16 and will be held at the U.S. Department of Transportation in Washington, D.C. The meeting is meant to "generate ideas that will improve, strengthen and sustain the cargo opportunities and sealift capacity," it said. Suggestions for agenda topics and other comments are due by Nov. 29.
Federal Maritime Commission Chairman Mario Cordero is requesting regulators from the E.U. and China to meet for a "Global Regulatory Summit: to discuss the proposed P3 Global Alliance, the FMC said in a press release. The proposed alliance would align the three largest container carriers, Maersk Line, CMA-CGM, and Mediterranean Shipping Company. The meeting would happen in Washington and allow for the regulators to discuss their roles for such an alliance, said the FMC.
Florida Governor Rick Scott will recommend to the state legislature to put $35 million toward "strategic port projects across Florida," he said in a press release. The projects will enhance our ports’ ability to move more goods which will position Florida to play an even greater role in global trade, he said. "Our strategy to make Florida the gateway for global trade is working.”
The Canadian National Railway is facing the possibility of a strike beginning Oct. 28, after negotiations between the railroad and the Teamsters Canada Rail Conference broke down. The union, which represents 3,300 conductors, trainmen, yardmen, and traffic coordinators at CN, is “gearing up for a fight with the railway company,” it said in a statement Oct. 14 (here). The labor dispute concerns working hours and rest time between trips.
Air freight traffic will grow by 4.8 percent annually over the next 20 years, said Airbus in its “Future Journeys” Global Market Forecast. With passenger traffic growing by 4.7 percent each year during the same period, that means the world will need about 30,000 new aircraft worth about $4.4 trillion over the next 20 years, the report said, including over 2,500 new freighters.
A potential lapse in funding for the Energy Information Agency (EIA) may pose an issue for shipping contracts, said Bruce Johnson, director-carrier services at C.H. Robinson, in a blog post. The transportation company said many contracts that use a fuel surcharge table rely on weekly reports from the Department of Energy's EIA on national average diesel prices. The EIA is expected to run out of funding as of Oct.11, meaning it would not be able to release the planned Oct. 14 report, the company said. "If the EIA is unable to publish the average diesel price on Oct 14, there is no single free alternative that the industry can rely upon of which we are aware," it said. "In the short term, we recommend using the same average price that was published this past Monday Oct 7 by the EIA. While it is not ideal to use the Oct 7 prices, compared to potential administrative and billing discrepancies it is the most effective solution in the short term." The EIA didn't return a request for comment.
Federal Maritime Commission employees will not respond to email or phone inquiries during the shutdown, according to an update posted on the FMC website. Given the outage of several FMC databases (see 13100120), the commission will not be accepting filings for service contracts through SERVCON, Ocean Transportation Intermediary applications through the Automated OTI Application (FMC-18), or Tariff Registration Forms (FMC-1). It also won’t be accepting filings for ocean carrier or marine terminal operator agreements or amendments, or agreement monitoring reports, minutes, or transcripts. Complaints, requests for dispute resolution services, and ombudsman services won’t be accepted either.
The Transportation Security Administration should lift the requirement that carriers report monthly air cargo screening statistics, said The International Air Carrier Association Chairman Oliver Evans in a letter to TSA Administrator John Pistole. Evans said the 100 percent level for screening of inbound cargo under the National Cargo Security Program was achieved nine months ago, but the reporting requirement remains in place. Evans said this is of "great concern" because "the requirement places a significant labor and data collection burden" on the air cargo industry because companies must expend both human and IT resources to meet the requirement. Evans said Pistole should use his powers under the 2013 Department of Homeland Security Appropriations Act to certify that TSA has achieved screening of 100 percent of air cargo and to then lift the reporting requirement.