Ocean Cargo: NITL committee meeting to examine state of the industry

When the National Industrial Transportation League’s ocean transportation committee meets next month in Louisville, Kentucky, the agenda will be rich indeed. According to chairman, Don Pisano, committee members will be discussing a wide topics ranging from “slow steaming” to the Rotterdam Rules.

In an exclusive interview with LM, he said that chassis shortages are also a big concern.

“For each line not providing a chassis, we must factor into our freight calculations the expected additional costs per container when comparing rates among our ocean carriers,” he said.  “This is particularly burdensome on distribution centers and public warehouses when scheduling the unloading of containers received from multiple clients using various ocean carriers, some with free chassis and some bearing a daily chassis rental fee.” 

Pisano added that some clients are getting their freight “leap-frogged” in order for the DCs and warehouses to minimize the chassis costs on other clients they serve who are bearing the daily chassis rental.

Capacity issues are also top of mind these days, he said.

“We believe there will be continued tightness in 20-foot dry containers coming out of Asia,” he said. “But 40-footers are available and can be substituted provided sufficient vessel space remains available.”

In keeping with what industry analysts have told LM, Pisano expects minimal shipment delays due to vessel and equipment capacity shortages through the Peak Season.

“Slow steaming” on the transpacific, however, will continue to hurt the long-term competitive position of U.S. West Coast ports, said Pisano. He added that hikes in night gate rates and potential labor slowdowns will also have an impact.

“For a number of other reasons, we expect to see a shift from the West Coast ports of Los Angeles and Long Beach toward all water services to the Gulf Coast ports, particularly for lower valued products which are less sensitive to longer transit times,” he said.

Pisano noted that it has been almost two years since the U.S. signed the Rotterdam Rules – an international law convention governing marine cargo loss and damage on liner carriers. 

“The rest of the world in now looking at the U.S. to ratify the convention and codify the convention into U.S. law,” he said. “Since adoption of a new liability regime is critical for U.S. companies in that it would bring predictability to claims and reduce instances of unnecessary litigation, we would like to see the Rules advanced from the State Department to the Senate for ratification without further delay.”

Pisano also said that the League hopes to see measures instituted that will reduce the incidence of cargo thefts in the coming years.

“These changes should include use of better statistics and coordination among law enforcement agencies,” he said.

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