Business & Investment

Can US ports handle the privileges that US Port Access Privileges Act may impose?

“”It is a privilege, not a right, for foreign exporters to access the American market and our consumers. Cargo ships seeking to profit from West Coast ports by unloading foreign-made goods must offer US export opportunities in return. Our law will put American exports at the forefront at our ports to assist American businesses and workers.

This is the “American Port Access Privilege Law” by members of the House of Representatives John Raymond Garamendi (D-CA03), Jim Costa (D-CA16), and Mike Thompson (D-CA05).HR8243) Put US exporters at the forefront of US ports to support the US economy.

What is the US Port Access Privilege Law .. ??

According to a press release from Congressman Garamendi, the US Port Access Privilege Act (HR8243) Ensuring fair trade in US companies and making hard-earned foreign markets available to California agricultural exporters in the following ways:

  • Codify current preferences for military, Jones Law, and other US-flagged vessels practiced in many major US ports.
  • Serve multiple US ports or establish secondary berth priorities for ocean-going commercial vessels with large cargo reservations for US exports. This new priority mooring rewards maritime carriers servicing both US importers and US exporters by moving their vessels to the top of the line for unloading and loading. increase. Similarly, it provides incentives for sea carriers to make second-segment voyages to ports such as Oakland, which are important to California’s agricultural exporters.
  • We guarantee that the new priority berths of export carriers will not interfere with the US Coast Guard’s commercial vessel orders, port safety, or collective bargaining agreements for port workers.
  • Export vessels seeking preferential mooring must report the cargo reservation to the port operator at least 7 days in advance.
  • Authorizes the Department of Transportation Statistics of the United States Department of Transportation to collect data on mooring and cargo practices at US ports. This will assess the shipping company’s practices regarding port calls and cargo reservations, as well as the impact of the preferred mooring provided under the bill.

The introduction of the US Port Access Privileges Act follows the recent passage of the Shipping Reform Act, which aims to support the growth and development of US exports and promote mutual trade in US foreign commerce.whether Whether the 2022 Marine Transport Reform Act Addresses US Supply Chain Disturbances..

U.S. port exports

The focus of the bill seems to be on promoting exports from the United States in general, especially agricultural exports through the Port of Oakland.

Looking at current average exports and export statistics compared to the last 5, 10 and 15 years, we see a decline in exports since the pandemic.

US Port Access Privilege Law-Export Baltimore is the only major US port to have increased exports in May 2022 compared to 5, 10 and 15 years ago.

There was some debate about carriers sacrificing US exports to return empty containers to Asia.

US Exports vs Imports vs Sky

However, if you take a closer look at the volumes, the increase in the outbound empty volume corresponds to the increase in the full volume of the import as the carrier is forced to move more and more in the sky. 2009 is addressing this increase in outbound empty containers.

Export and empty

As we have seen, since 2020, US ports have faced a large number of imported containers caused by pandemic-induced demand, clogging yard space inside and outside the port, and (literally) inventories. On the chassis, the carrier was backed up with more imported full containers because the port was full and could not accept the empty, which went up to the roof and clogged the warehouse where the empty containers were sitting. I tried to clear up more skies in order to bring it in and resume the vicious circle.

Priority mooring

U.S. Port Access Privileges Act advocates priority berths for shipping companies that serve both U.S. importers and U.S. exporters, but the majority of shipping companies calling U.S. ports are outside the U.S. It may be easy to say because it is flagged and not owned by the United States. ..

US flagships make up less than 0.5% of the world’s fleet, Transport Statistics Bureau..

The act of preferential berth may be interpreted as a business intervention between the U.S. Government and its supervisors, as it affects the vessel schedules of airlines operating in the U.S. market and may achieve the above. There is a concern. Or indirectly).

Impact of port performance on US port access privilege law

Returning to exports, the promotion of export cargo priorities and priority mooring proposed by the U.S. Port Access Privileges Act is a good move to assist U.S. exporters, but authorities need to pay attention to important issues. I have. It’s the performance of US ports. It remains a concern.

Ultimately, all vessels, whether they are ocean-going commercial vessels servicing multiple ports in the United States or vessels that have a large reservation for US exports, are low in productivity and operational. Calling the same US port / container terminal that has been hampered by inefficiencies. ..

The major US gateway ports in Long Beach and Los Angeles have been operating with record volumes of processing power since 2021, while the World Bank and S & P Global’s Container Port Performance Index (CPPI) 2021 has these two ports. Finally died at 369 and 370. In terms of efficiency .. Oakland came in at 359 of the 370 ports on the list.

The port of San Pedro Bay, which bears the brunt of high port congestion in 2021, accounts for 40-42% of the container transport that flows into the United States, much of it from the east.

CPPI is based on indicators such as crane movement per hour and ship mooring time at the port. US ports are lacking in these areas compared to Asian ports, and many experts believe automation is the solution. Port inefficiencies are also the reason why many services have canceled calls, especially to Auckland.

Of all the major US ports considered, the total (import, export, air) volume of ports processed between January 2020 and May 2022 shows all but Baltimore. You can see that the port shows an increase in the total amount processed ..

Total volume and number of working days of the vessel

But more importantly, at all ports, the number of days ships work in ports has increased significantly.

Since the above law targets exports, especially when looking at exports, only Long Beach and Savannah showed an increase in exports from January 2020 to May 2022, and all ports showed an increase in the number of days of vessels. rice field. Working in the harbor during the same period (quantity figures for New York and Baltimore are based on April 2022).

In particular, in Auckland, the number of days ships work in ports increased by 200% in May 2022 compared to January 2020 and by 18% compared to April 2022. Export volume and number of working days of vessels

In both cases, the increase in the length of stay at the port is disproportionate to the increase in volume.

Ocean carrier and intermodal reliability

Carriers are already struggling to maintain the reliability of their schedules, leaving voyages blank on all major routes due to delays, port congestion, increased transit times, and recent declines in fares. Have been forced to.

Increased ship stays in the port delays schedule rotation, backlogs ships and volumes, and further disrupts the supply chain.

Of course, the solution, without sacrificing volume, is to ensure port efficiency at US ports and avoid delays due to potential export volumes if the law is enforced.

Another issue that plagues US exporters is the unreliability of intermodal services and the proper placement of chassis. US agricultural exporters are generally located in the US hinterland, so empty containers need to be available for packing exports at these locations. ..

Nowadays, it seems that importers are using the hinterland of a complete container instead of unpacking the cargo in the coastal area, sending the cargo by truck, and returning the empty container in the coastal area. Exporters are having a hard time accessing empty containers at these locations. , Due to service reliability issues in the intermodal rail network.

Overview

Currently, there are some issues facing the US supply chain. Lack of rail availability, more empty containers loaded than exports, full import containers welcomed at various ports / terminals, carrier schedule reliability, port inefficiency , Declining consumer demand, high inflation, bloated inventories, soaring sea freight rates (although spot rates are declining), uncertain labor negotiations, Demurrage and detention Fees etc ..

The actions of the federal government and its regulators in various areas since 2020 are welcome signs that the supply chain issues that have long plagued the US market are being seriously considered.

However, issues such as the inability of ILWU and PMA to reach an agreement after the contract expired on June 30 have led to much of the industry, although both sides have promised to continue normal operations at the port. It’s a concern for people.

The important and difficult question that lawmakers currently have to ask regarding the proposed implementation of the US Port Access Privilege Act is: Whether US ports and supply chains are tuned to improve efficiency and handle additional export volumes without compromising the schedules of already stressed carriers. This can have further impact on the supply chain.

Can US ports handle the privileges that US Port Access Privileges Act may impose?

https://www.shippingandfreightresource.com/can-us-ports-handle-the-privileges-that-american-port-access-privileges-act-may-bring-with-it/ Can US ports handle the privileges that US Port Access Privileges Act may impose?

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