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Ocean Fast Facts
Which Chilean port handled 687,684 TEU during 2008 and is the most commercially important seaport in the country?
- Port of Antofagasta
- Port of San Vicente
- Port of San Antonio
- Port of Expresso Grande
Hazmat
(Shipping) Hazmat is an abbreviation for hazardous materials which is a substance or material which has been determined to be capable of posing a risk to health, safety and property when transported in commerce.
Source: Dictionary of International Trade, Edward G. Hinkelman, 8th Edition, 2008.
Don't Be Hazardous to your bottom line, know how to handle your "hazmat"
Within the United States, "hazmat" is a substance or material which has been determined by the U.S. Secretary of Transportation to be capable of posing an unreasonable risk to health, safety and property when transported in commerce and which has been so designated. Title 49, Code of Federal Regulations (U.S.) Transportation - Parts 100-199 governs the transportation of hazardous materials. Hazardous materials may be transported domestically, but they may be classified as Dangerous Goods when transported internationally by air.
When cargo is classified as "hazmat," it is important when requesting rates or bookings to provide MSDS (material safety data sheets) as well as complete hazardous cargo commodity descriptions including pieces, weights, packaging, U.N. number and hazardous packing group. Several commodities such as Class 1 and respective sub-classes (Explosives) are restricted by ocean carriers, insurance underwriters, local governments and terminal operators. In order to ensure your "hazmat" freight is acceptable for carriage, provide the appropriate information to your AIT representative.
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Spring is here... "Bouncing" into a Peak Season during 2010
Throughout February, several carriers in many trade lanes have announced general rate increases (GRIs) coming in March. Some carriers have directly advised AIT that they expect a "full" quarterly GRI recovery plan during 2010. This means some carriers are proposing GRIs each quarter for the remainder of 2010. While it is too early to tell if carriers will be successful with this program, it appears that some carriers are returning to rates that in 2009 were deemed "non-compensatory" by many ocean lines.
As the markets are in flux, there already are new signs of life in 2010. Some GRIs held, especially in many trade lanes like USA to Europe and USA to Brazil. Even considering some jumps in rate levels; vessels in most import and export trade lanes to and from the USA remain at or near capacity.
Additionally, the recent "ERC" from Asia to the USA held strong and has been "rolled" into base line ocean rates in some cases. The ocean carriers on the Trans Pacific Import Trade to the USA; represented primarily by the Transpacific Stabilization Agreement (TSA) member carriers has tentatively announced May 1 GRIs with significant increases planned. At this time, it's premature to determine if the next GRI in the Asia to US trade lane will hold, but one thing that appears certain is that carriers in the trade will attempt to charge a Peak Season Surcharge (PSS) as volumes from Asia are anticipated to remain strong through April and May into the peak season that historically starts in June.
Should you have any questions about rates and capacity for trade lanes relative to your specific transportation needs, contact your AIT representative.
REMINDER! China to Enforce the CCAM Regulation
AIT would like to remind customs that the Chinese Customs Advance Manifest (CCAM) Regulation, first introduced in 2009 will soon be enforced by the Chinese government. Ocean carriers bringing freight to Chinese ports are required to ensure documentation is completed 2 business days prior to the operational cutoff at the port. Several ocean carriers are adjusting their cutoffs to comply with the regulation.
To ensure that your cargo is loaded, full shipping instructions are required by the close of business on the documentation cutoff date. The following pieces of information are required on shipping instructions (SI) in order to comply with both US Customs and CCAM regulations: voyage number, payment terms, total number of packages, type of packaging, type of inner packaging, cargo description, gross commodity weight by item, cargo weight, shipper/forwarder name and address, consignee/notify name and address, container number(s), and ITN (Internal Transaction Number).
For more details on the regulation, please refer to the China Customs Web site at www.customs.gov.cn. Note: The regulation is available only in Chinese.
Trans Pacific Import Rate Watch: Did you know?
In their February 22, 2010 edition, the Journal of Commerce reported their 40' full container ocean freight rates excluding origin THC for NVOCCs between Hong Kong and Los Angeles are approximately $600 higher on February 8, 2010 than the same week in 2009 (February 9). This rate difference reflects the success of the carriers' implementation of General Rate Increases (GRIs) and Emergency Revenue Charges (ERC) over the past year combined with decreased capacity.
The "rightsizing" of global ocean capacity
Since September of 2008, ship-owners have cancelled 140 container ship orders. According to the Journal of Commerce, global capacity is expected to shrink by 6.7 percent from the initial total orders placed for container ships. The total amount in terms of TEU capacity is 436,000 20-foot equivalent units or approximately 6.7 percent of the 6.51 million-TEU order book on Oct 1, 2008, according to Alphaliner, a Paris-based consulting firm. Despite the recent glut in container shipping, the cancellation rate for container ships is lower than the current cancellation rate for bulkers and tankers. Additionally, the figure includes 27 container ships that had been converted to other vessel types. Some of the cancellations were straight cancellations, others orders that had been delayed so long that they were believed to have been "dropped" orders. The cancellation count "excluded" vessels that had been built but not delivered due to the inability of owners to make complete payments.
As witnessed with the recent flood of general rate increases (GRIs) in global trade lanes, the carriers are hopeful to continue to pass along GRIs and several of them are pushing for a "quarterly" GRI plan as even on reduced capacity in January and February of 2010. Ocean lines still seem to be successful at filling ships with higher rate levels at this time.
Source: Journal of Commerce Online, February 23, 2010
Haiti Update
After the January 12th earthquake in Haiti, port operations were suspended as the port facility at Port-au-Prince was destroyed. The port is up and running again and Haiti's port authority has requested that vessel operators file advance notice before ships arrive. As of mid-February, the port was expected to handle 2,000 TEUs each week. Congestion around Haiti has increased as relief goods have been pouring into the country and authorities recommend smaller vessels use alternative ports such as Cap Hatien. The Haitian authorities are also prioritizing cargo and at this time relief goods remain top priority. If requesting rates for cargo into Haiti, non-relief good cargo will not be treated with the same high priority as relief goods. Additionally, vessels operating service to Haiti are required to have a Haiti based agent.
NEW from AIT Ocean Systems: AIT's Automated Ocean Rate Request Feature!
AIT now offers AIT Ocean customers the ability to submit rate requests in an automated format using the CargoSphere online rate quote system. This now allows AIT customers to request rates and receive automated rate quotations complete with quote numbers and quotation validity dates making the quote process more timely and efficient.
To get started on the AIT automated rate quotation system CargoSphere, click on the following link and start automating your rate quotation process:
http://www.cargosphere.net/ait/ptrade/jsp/CustomerAgentRateRequest.jsp
March Congestion Alert!
At press time, certain port locations were reporting congestion. Port areas subject to possible congestion:
- Jamaica (Kingston) = For both transshipment relay and direct cargo
- Greece = National strikes are in effect as of the end of February
- Colombia (Buenaventura)
- North African Ports (Tripoli / Algiers)
- Venezuela Ports (Puerto Cabello / Guanta)
- West Africa (Luanda / Angola)
- Nigeria (Tincan / Apapa)
- Haiti (Port-au-Prince) = Very limited port operations - relief goods remain a priority
Be advised that ocean carriers may temporarily enact "Port Congestion Surcharges" in times of peak volumes. Contact your AIT Representative if you have questions.
Venezuela: Pre Approval Required for Shipments
In the February edition of the Ocean Newsletter, AIT had advised that effective February 1st, 2010 prior approval by AIT is required prior to acceptance of cargo. Venezuela has recently increased fines to the existing customs penalties for such matters as document correction. Fines can be heavy. If shipping to Venezuela, the following information will be required by AIT for review and approval prior to acceptance of cargo:
- Shipper name and full address
- Consignee name and full address - must be end user if destined for Venezuela
- Specific commodity description
Example: "Electric Equipment" or "Computer Equipment" is not sufficient, specific information is required. For instance: "HP color printer".
- Total number of pieces/weight
- Mode of transport being requested (air or ocean)
- Value of cargo, whether or not insurance is being requested, AIT would require the actual value of the cargo.
The AIT Ocean System's team thanks you for a great February. It was quite an active month and AIT witnessed record amounts of rate quotations.
AIT will also be participating in the Annual Trans-Pacific Maritime in Long Beach, California from March 1 - 2. If you are planning on attending keep an eye out for AIT, we'd be happy to meet up and chat about "sea freight".
The compliance challenges and implementation presented by ISF/10+2 have kept AIT's designated teams active and ready to assist with processing of ISFs and answering questions about the new regulation. It seems 2010 is already experiencing "swelling" seas as volumes seem to be recovering. The AIT Ocean Systems is looking forward to assisting you with your ocean freight needs this spring and beyond.
Preview April 2010 AIT Ocean eNewsletter:
A "double" Buzz Word of the Month
If you have any questions or comments regarding the Ocean eNewsletter,
please contact Kevin Krause from the AIT Ocean Department.
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