BRi USA News - Carriers Warn of Supply Chain Chaos if Cargo Stacks Up in Ports
Dear all Valued Customers
A series of issues, including store closures, lack of drivers, and a shortage of warehousing space, are forcing some shippers to leave their cargo uncollected at ports in the United States and Europe.
Warning that the world’s supply chains would break down if ports become congested, the World Shipping Council (WSC) Tuesday urged local and national governments to support policies that ensure a fluid flow of cargo through container terminals.
With non-essential retail stores closed, warehousing staff shortages, and travel bans affecting trucking, forwarders and shippers are reporting regular bottlenecks at key container handling points, such as ocean terminals and border crossings. The WSC highlighted the growing concerns, noting the integrity of the international supply chain was dependent on the continuous flow of goods.
“In many parts of the world, backups at warehouses, shortages of truck drivers, and scheduled deliveries of goods that importers cannot sell are causing cargo owners to leave cargo at the ports,” the WSC said. “A delay or disruption in one part of the supply chain becomes a bottleneck and will trigger another delay or disruption elsewhere — ultimately affecting the movement of critical food and supplies.”
No place for everything
In Europe, there is growing urgency for shippers and their forwarders to come up with solutions to manage a wave of unneeded inventory that is now in transit and about to land at ports in the locked-down continent.
In the United States, container lines, ports, and forwarders have warned of congestion from imports piling up at marine terminals in the coming weeks if more US retailers and manufacturers fail to pick up containers. The reasons are varied — either because warehouses are full or closed due to not being deemed essential service providers responding to coronavirus, or because retailers have requested delayed deliveries at distribution centres. But the effect will be that ports could run out of places to store incoming shipments.
Container shipping companies appear to be responding to customers and offering solutions, such as storage in transit, storage at origin, or holding cargo at transhipment hubs closer to markets where the products will be quicker to deliver once demand returns.
U.S. Ports Status Update
Below is a general overview of the operations BRi USA has been able to gather for most major U.S. ports. This list will be updated as information is made available.
Port of Seattle & Tacoma - Select terminal(s) at the port are closed Friday, April 10.
Port of Los Angeles/Long Beach - The ports continue to operate as normal with no significant interruptions and have no vessel concerns due to COVID-19. The Port of Long Beach has established a Port Recovery Team that has implemented a Business Recovery Plan to handle any COVID-19 issues. Currently the port is working with chassis operators to ensure there are no issues in chassis availability as well as terminal operators to ensure storage space is available for staging.
Port of Houston - Port Houston is open and operational this week, including Friday, April 10. The port also began a weekly disinfecting and sanitizing service of all offices and common areas at Bayport and Barbours Cut Terminals.
Port of New York/New Jersey - Port Newark Container Terminal, Maher Terminal, GCT NY, and GCT Bayonne, will all be closed Friday, April 10.
Port of Baltimore – The Seagirt Marine Terminal is closed Friday, April 10.
Port of Boston – In mid-May the Port of Boston is launching a new barge service that will provide an all-water connection to the New England markets. This barge will provide direct service between Global Container Terminal (GCT) in Bayonne, NJ and the Port of Boston for THE Alliance ocean carriers: Yang Ming, Hapag-Lloyd, Ocean Network Express (ONE) and Hyundai Merchant Marine (HMM). The 912 TEU barge, will load for New England imports on Sundays and arrive in Boston for a start time by 8:00 a.m. Tuesdays. The barge will then transport exports and empties back to GCT Bayonne for vessels loading the following weekend.
Port of Virginia - Effective April 9, temperature screenings will begin at Norfolk International Terminals and Virginia International Gateway. All persons requesting terminal access will be screened (port employees, longshoremen, harbor pilots, etc. Truckers will not be screened as there is no physical contact. The port will also be closed Friday, April 10.
North Carolina Ports – Terminals in Wilmington, Morehead City and Charlotte will be closed to commercial truck traffic on Friday, April 10, special operating arrangements may be made upon request. Most notably, the port has completed Phase II of its Turning Basin Project at Wilmington, which will allow the port to receive 1,200 foot container ships carrying 14,000 TEUs. This is among some of the largest vessels to call the US East Coast.
South Carolina Ports – The ports are open and operational. All terminals will be working regular hours this Friday, April 10.
Port of Georgia - The Georgia Port Authority continues to extend the Saturday Gate closure through the entire month of April, 4/4/2020 through 4/25/2020, this includes all services for dry and refrigerated containers.
US Freezes Shipments of Certain Health and Medical Supplies
An advanced Federal Register Notice has been scheduled for publication on April 10, 2020, issuing a ruling by the Federal Emergency Management Agency (FEMA) on the prioritization and allocation of certain scarce or threatened health and medical supplies. While temporarily in place for 120 days after the April 10th publication, this final ruling asserts that FEMA may allocate certain scarce or threatened materials for domestic use, so that these materials may not be exported from the United States without explicit approval. Further, any FEMA contract supersedes an existing commercial contract for certain PPE goods.
The rule covers five types of personal protective equipment (PPE), outlined below. A full list of each product’s specifications that apply for the ruling is found here.
• N95 Filtering Facepiece Respirators
• Other Filtering Facepiece Respirators (e.g., those designated as N99, N100, R95, R99, R100, or P95, P99, P100)
• Elastomeric, air-purifying respirators and appropriate particulate filters/cartridges;
• PPE surgical masks, including masks that cover the user’s nose and mouth
• PPE gloves or surgical gloves, including those defined at 21 CFR 880.6250 (exam gloves) and 878.4460 (surgical gloves)
There is an exemption included in the notice, however exporters should confirm with FEMA that they meet the specifications prior to exporting. The exemption specifically states “that FEMA will not purchase covered materials from shipments made by or on behalf of U.S. manufacturers with continuous export agreements with customers in other countries since at least January 1, 2020, so long as at least 80 percent of such manufacturer’s domestic production of covered materials, on a per item basis, was distributed in the United States in the preceding 12 months.”
Note that the notice also does not address how Customs and Border Patrol (CBP) at the port of export will know that FEMA has confirmed the shipment meets the exemption or if FEMA has otherwise authorized the shipment to export. Any “attempts to export” in a manner contrary to law or regulation are subject to “10 years’ imprisonment, a fine, or both, if convicted.” The current instruction from CBP is to discuss eligibility to export with FEMA and if FEMA approved the export, contact CBP at the port of export for the process.
India Freight Update
BRI USA has received the following update from our India office:
• Carriers continue to announce blank sailings and vessel delays. Port operations continue to be delayed due to berthing delays.
• Few freighters are operating. Some airlines have announced ad hoc freighter shipments to offer more capacity.
• Container freight stations continue to be congested due to importers not taking deliveries of discharged containers.
• Most truckers are unable to accept orders due to the lack of availability of drivers. Those that are working are only picking up essential commodities at this time.
• General storage warehouses are also congested due to lack of availability of forklift drivers, crane operators, etc.
As a valued customer, we hope that you will continue to trust us to source the best options for your supply chain needs now and into the future. Feel free to contact your Customer Solutions Representative, should you have any questions regarding the USA News.
Keeping you updated,
BRi Customer Solutions Team
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