/ By tjchinafreight ivy / Shipping

Has the inflection point of the shipping industry reached?

Although Maersk still achieved good results in the first quarter of this year, this was mainly due to a large proportion of long-term contracts with high freight rates. In addition, the company and the Danish Investment Bank said that the inflection point of the container shipping industry may be coming.

Has the inflection point of the shipping industry reached?
Has the inflection point of the shipping industry reached?

Maersk successfully wins more long-term contract customers

For Maersk, although inflation and rising oil prices have led to an increase in unit transportation costs and a downward trend in freight volume, more and more customers choose to sign long-term contracts with higher freight rates, which stabilizes Maersk's current and future 's earnings. Maersk Chief Executive Søren Skou said in a Wednesday press conference: “Our first quarter financial performance was strong, and combined with a negotiated increase in long-term contract prices by an average of $1,400/FFE, our revenue this year is conservatively estimated to be better than $10 billion increase last year.”

He stressed that so far, Maersk has signed long-term contracts with 71% of its customers.

However, the marginal benefit is limited. "Our earnings can go up to another 80%," Skou said. "We also need some cash for revenue flexibility, but I still expect our earnings to continue to go up to 80%."

Very high customer satisfaction

Maersk's first-quarter performance set a new record, but behind it was a 6.7% drop in shipping volumes in the first quarter, a significant increase in shipping costs, and a 71% increase in average freight rates.

The first-quarter financial performance of other liner companies is estimated to be on par with Maersk. It's clear that ocean freight customers still have to pay much more than before to get their goods shipped around the world.

DSF: Historic growth is coming to an end

Another shipping investment bank, Danish Ship Finance (DSF), which is also located in Denmark like Maersk, showed in its latest semi-annual forecast report that there are clear signs that the historical growth period that will promote the development of the container shipping market and generate huge profits is coming. Finish.

The agency said in its latest forecast report that in the short term, the currently murky demand outlook and growth in available capacity could put pressure on container freight rates and used container ship prices. Over the longer term, the market deterioration will accelerate with the influx of ships above 12,000 teu and a weaker demand outlook. This could put significant pressure on most container markets, especially raising the risk that vessels owned by tonnage suppliers will no longer be able to secure contracts. "

/ By tjchinafreight ivy / Shipping

How to apply for FMC airline qualification in the United States ?

A few days ago, the US Federal Maritime Commission (FMC) issued a notice that it will investigate the surcharges of eight ocean carriers - including related surcharges such as congestion surcharges related to the continued surge in freight demand.

Eight ocean carriers were asked to provide details of their congestion surcharges and any associated charges to the FMC's Enforcement Bureau. The expedited investigation requires carriers to provide evidence by August 13, 2021 that their surcharges are in compliance with the FMC's regulatory requirements.

How to apply for FMC airline qualification in the United States
How to apply for FMC airline qualification in the United States

What is US FMC?

FMC is the abbreviation of the Federal Maritime Commission. It is headquartered in Washington and has three functions: executive legislation, quasi-judicial and law enforcement. It is in charge of and supervises the maritime commercial activities mainly based on container shipping starting and ending in the United States. . Ocean carriers and brokers are regulated by it.

The role of FMC:

Manage water freight rates, charges and operations for cargo such as containers in U.S. coastal trade, foreign trade and re-export trade;

Manage the operations of the container ocean shipping industry and companies that provide container terminal handling facilities;

Approve, veto, outlaw or revise meetings and agreements between water carriers (shipping companies) in U.S. foreign trade and domestic cabotage and the contractual freight rate system they employ;

To develop regulations to address conditions that are detrimental to the U.S. shipping industry due to foreign laws or competition from foreign-flagged container ships and other freighters;

Hear allegations of various violations of maritime law and determine whether it is illegal.

How does China's NVOCC file with the US FMC

The specific reporting requirements of FMC include:

1. Tariff (public tariff) does not need to be reported to FMC, and the carrier must publish its published tariff through appropriate electronic means to ensure that anyone (including FMC) can easily inquire at any time.

2. Service contract: A written contract signed by one or more cargo owners and a single ocean common carrier or an agreement organization composed of multiple ocean common carriers in addition to the bill of lading or cargo receipt. According to the contract, the owner promises to provide a certain amount of goods or the proportion of the goods within a fixed period of time, the carrier or the carrier organization promises a certain price or price arrangement, and the agreed service level, including guaranteed space, transportation time, Port order or similar service content. The contract can also provide for the breach of contract by both parties.

3. The carrier must report the complete service contract or amendments to FMC before the goods are shipped. FMC has strict requirements on the format and content of contracts. Each contract must have an independent contract number (SC Number), and each change must have an Amendment Number arranged in sequence.

4. Except for the origin, destination, product name, minimum quantity guarantee, and contract validity period, other contract contents are kept confidential by FMC.

/ By tjchinafreight ivy / Shipping

Mason regular ship and overtime ship

As the main mode of transportation in international trade, international shipping accounts for more than two-thirds of the total international trade volume. When it comes to shipping, we have to mention Mason, which is divided into regular ships and overtime ships. What is the difference between them? Next, let's take a brief look at it.

Mason regular ship and overtime ship!
Mason regular ship and overtime ship!

The sailing dates vary:

Mason's regular ships usually sail every Wednesday in Shanghai, and overtime ships usually sail on Thursdays. Generally speaking, they will sail for 11 days. The sailing time at Ningbo Port will be one day earlier, usually every Wednesday.

The efficiency of the cabinet is different:

After unloading the container, Matson's main ship will also load other goods to Hawaii immediately. This part of the route is their own domestic transportation, so Matson will arrange enough manpower on the dedicated terminal to unload and load the ship. The front and the frame of the United States are separated, and the Mason regular ship can ensure that each frame and box are ready to be pulled by the front, so the efficiency of the regular ship cannot be replaced by other ships.

Prices vary:

The timeliness of the main ship of Mason is very fast. If it arrives in the west of the United States, it can be put into the warehouse within 9 working days. Of course, the price will be more expensive than the overtime ship. There are other types of services of Mason, such as time-limited arrival, less than package. Compensation and other prices will also be a bit more expensive than other types of services. Sellers who pursue the timeliness of goods transportation can consider this type of service.

The docks at the unloading port are different:

After the main ship of Matson arrives at the port of destination, it will stop at the Port of Long Beach and the Port of Oakland. According to the official information of Mason Steamship, the pick-up location of Long Beach Port is located in the out-of-port storage yard (STE) 3.5 miles away from the terminal, and the pick-up location of the Oakland port is located at Pier 63 or 0.5 miles away from the terminal. There is no need to make an appointment for each of the lockers and the lockers. Therefore, the general cargo can be picked up the next day after arriving at the port.

Matson overtime ships usually dock at Pier A for unloading. This wharf is a joint venture between Matson Shipping, MSC and Yixing Clipper, which is a public wharf. Therefore, the unloading efficiency of the overtime ship of Mason docked at this terminal is relatively low. When the number of ships at the terminal is large, there is even a queue to wait for the port.

How to quickly distinguish between Mason's regular ships and overtime ships?

Look at the route code. The code of the main ship of Mason is CLX, and the code of the overtime ship is CLX+.

The CLX+ departed from Shanghai on Thursday to the Port of Long Beach on an 11-day voyage, and from Ningbo to the Port of Long Beach on a 13-day voyage.

There is also a peak season overtime express, namely CCX. It takes 12 days for CCX to sail from Shanghai to Oakland Port, and it takes 14 days to sail from Ningbo to Oakland Port. Generally, ships stop at Oakland Port for 2-3 days and leave, and then go directly to Long Beach Public Port, with a 1-day voyage. Because of the stopover in Auckland, the voyage between Shanghai and Long Beach will be 2-3 days longer than CCX and CLX+.

The transportation time between the main ship and the overtime ship will be about 4-6 working days. If there is no great requirement for the transportation time of the goods, you can also choose the overtime ship. Of course, it is better if there are other shipping companies. The shipping channel is also optional.

/ By tjchinafreight ivy / Shipping

Supplementary charges for port terminal canals

Everyone also knows that there are many types of shipping surcharges. In order to make up for their own losses in various aspects, the ship party has added a number of surcharges in various names. However, among the marine surcharges, some charges are imposed by the port, terminal, or canal authority. Do you understand this kind of cost? Today, I will use the simplest language to tell you about the surcharges imposed by the port, wharf, and canal authorities.

Notice to sellers: Analysis of these additional costs for port canals

Supplementary charges for port terminal canals
Supplementary charges for port terminal canals

Today, I will use the simplest language to tell you about the surcharges imposed by the port, wharf, and canal authorities. The canal authority adds a surcharge to the ship owner based on each vessel’s net Suez tonnage and the canal rate table, and the owner collects this fee from the customer in the form of the Suez Canal Surcharge.

Everyone also knows that there are many types of shipping surcharges. In order to make up for their own losses in various aspects, the ship party has added a number of surcharges in various names. However, among the marine surcharges, some charges are imposed by the port, terminal, or canal authority. Do you understand this kind of cost? Today, I will use the simplest language to tell you about the surcharges imposed by the port, wharf, and canal authorities.

Notice to sellers: these kinds of additional charges on the port canal

Port Surcharge (PS)

In some ports, due to poor equipment conditions or low loading and unloading efficiency, as well as other reasons, the shipping company charges additional fees. It is generally calculated as a percentage of the freight, but some ports charge it per freight ton. Each freight ton is calculated by the gross weight of the goods or by volume. The difference between it and the port congestion surcharge is that the port surcharge is relatively fixed.

Port Congestion Surcharge (PCS)

Due to the congestion of some unloading ports, the berthing time of ships at the port will increase, which will affect the operating costs of the shipping company. In order to make up for this part of the loss, the surcharge charged by the shipping company to the cargo party is the port congestion surcharge. This part of the fee is directly affected by the degree of port congestion. If the port returns to normal, this part of the fee will be cancelled, but the port congestion surcharge has been charged when the freight is prepaid and will not be refunded.

Terminal Handling Charge (THC)

Terminal operation fee refers to the fee charged by the port, terminal, and loading and unloading company to the carrier to receive the exported container at the loading port yard, store it and transport it to the side of the ship, which includes the container cargo during the terminal period. All loading and unloading, translation, hoisting and hoisting costs and corresponding labor costs. According to the port of departure and the port of destination, the terminal operation fee can be divided into two types: the terminal operation fee at the departure port (OTHC) and the terminal operation fee at the destination port (DTHC).

/ By tjchinafreight ivy / Shipping

International express should not be ignored

International express is the delivery channel that many foreign trade and cross-border e-commerce sellers will choose, but everyone must pay attention to the following matters when sending international express to avoid unnecessary trouble and loss.

Do not ignore these things when sending international express
Do not ignore these things when sending international express

1. When sending express mail, it should be written in English in detail, accurately and accurately, and the handwriting is clear.

2. The return address should be detailed and accurate, and try to provide a phone number so that you can contact in time when there is a problem with the express delivery.

3. Parcel express does not include cash, dangerous goods and other prohibited items listed in national laws and relevant regulations, as well as items prohibited by the carrier from express delivery. For example, some courier companies do not carry sensitive items such as food and medicines.

4. In order to ensure the smooth customs clearance of delivery, please use English to declare to the customs in detail and truthfully in the corresponding column, the name of the goods, the quantity, the weight, the declared value, and the place of origin, etc. At the same time, any additional item expressions should be completed in English. In triplicate (must have at least one), or may cause delays in customs clearance.

5. International express delivery involves the entry customs tax of the destination country. Different overseas countries have different tax bases and standards. When you send international express, you usually need to fill in the goods list and the value of the goods. The value of this cargo requires you to be familiar with the customs thresholds of different countries. It is very important to carry out reasonable customs declaration according to different countries and the size and weight of the package.

6. Choose a professional international express company, which can not only provide free carton packaging, but also help you strengthen the packaging, free vacuuming, reduce the volume, and reduce the corresponding shipping costs, saving the customer's worry and effort throughout the entire process. Help customers Peace of mind.

7. If the delivery problem is which one of the four major international express delivery or EMS is used, you can choose the first-level agent of the four major international express delivery and EMS, and use the agency price for transportation, the price is low, and there are more choices.

/ By tjchinafreight ivy / Shipping

Say something you don’t know about European air freight!

I believe that many cross-border e-commerce sellers engaged in the European market will have the experience of shipping from domestic to foreign countries. Maybe some people are planning to transport their goods by air, but they are hesitant because they do not know enough about European air transportation. . It doesn't matter, now you can get a more comprehensive understanding of European air freight through the following points of cold/hot knowledge.

Say something you don't know about European air freight!
Say something you don't know about European air freight!

First of all, the cost of air transportation is relatively high. There are fixed flight routes from China to Europe, and it takes about 10 days. The longer air transportation time is because the airlines will round up or arrange some bulk cargoes in order to save transportation costs, which will delay some time. This mode of transportation is a little slower than direct express delivery, but the overall timeliness is still faster compared to ocean and rail transportation. If you use the Amazon FBA head-way service, the air express is usually reserved without reservation, which reduces a lot of trouble.

Air transport flights are divided into direct flights and transfer flights. A direct flight refers to a direct flight from the origin station to the destination station without transit. For example, Guangzhou China Southern Airlines flies directly to London. Transfer refers to the need to transfer more than one way from the origin station to the destination station. For example, China Eastern Airlines taking off from Guangzhou needs to fly back to Shanghai for transfer. Diversion flights are generally due to air rights issues to fly back to the local area for transfer or stopover. The difference between the two is that non-stop flights have higher stability, and the stability of connecting flights is relatively lower than that of direct flights, but the price of connecting flights generally has an advantage.

There is also a case of air charter flights, mainly including Liege Airport (LGG) in Belgium and London Thyro Airport (LHR) in the United Kingdom. Generally, this type of flight is a direct flight, so the stability of the flight is high. But at the same time, such flights also have disadvantages. For example, if the inspection is not timely, the flight cannot be boarded, and the flight density is not high, which will delay the shipment until the next week, resulting in problems with the timeliness. On the back end, there will also be delays in the timeliness due to the accumulation of a large number of goods, and at the same time, there may be misclassification of goods and lost pieces after unpacking.

European air freight declaration elements:

For domestic export declaration and foreign import customs clearance, detailed cargo information needs to be provided to the customs broker/clearance bank to declare export/import. The requirements for the declaration elements corresponding to each customs code are different, but in general the following are essential: Product name , Customs code, material, brand, type, ingredient content. We hereby remind all cross-border e-commerce sellers that the declaration elements should be as detailed and clear as possible. Detailed declaration elements will reduce the probability of inspection.

/ By tjchinafreight ivy / Shipping

Hapag-Lloyd fined $822,000

Hapag-Lloyd fined $822,000
Hapag-Lloyd fined $822,000

Approved by the Federal Maritime Commission on April 22, German carrier Hapag-Lloyd has been ordered to pay a civil penalty of $822,220 for 14 violations of U.S. shipping law -- $58,730 per violation Dollar.

The FMC's Enforcement Bureau investigated a complaint from freight company Golden State Logistics that Hapag-Lloyd imposed demurrage charges on 11 containers that could not be returned in time due to lack of storage space at the terminals (LA, LB ports) .

The Bureau of Enforcement launched an investigation into whether Hapag-Lloyd’s practice of imposing demurrage fees violated the U.S. Shipping Act and found that Hapag-Lloyd either failed to provide a location for the return of equipment or even did so when assessing demurrage fees. The location does not have an appointment to return the empty box.

This is part of an ongoing dispute over demurrage and demurrage (D&D) charges in the industry. Long controversial, D&D fees have become a hot topic in the industry as more and more containers are overloaded at terminals and ports over the past two years. In response to these complaints, the FMC has become increasingly vocal about fees, recently encouraging shippers and haulage companies to alert the Commission to disputes over fees.

Hapag-Lloyd fined for detention charges and told to stop violating Shipping Act (file photo)
Hapag-Lloyd fined for detention charges and told to stop violating Shipping Act (file photo)

Liner companies believe demurrage is necessary to ensure the efficient use of very scarce containers, while other stakeholders in the supply chain have complained that due to port congestion, container returns cannot be achieved within the stipulated time. Additional costs should not be borne by the business.

The findings of this incident will support the shipper's argument that it is unfair to charge when a timely return of the container is not possible.

The FMC said: “We have been focusing on the issue of container detention and demurrage for many years, providing multiple opportunities for parties to weigh possible solutions, and in the Container Detention and Demurrage Rules provide information on the collection of containers Specific requirements for the return of demurrage charges for empty containers, but despite such efforts, Hapag-Lloyd has not been able to change its behavior or practices.”

The FMC added that evidence showed Hapag-Lloyd had not changed its policy on container detention and demurrage rules. The FMC Commission provided extensive notice and opportunity for comment prior to developing demurrage and detention rules that clearly set out the criteria for imposing detention for the return of empty boxes, and when there is documentation indicating that there is not enough appointment time to return these It is unreasonable for Hapag-Lloyd to impose demurrage charges when shipping containers.

/ By tjchinafreight ivy / Shipping

A Simple Guide to Customs Declaration

Lifting a container from stack to a ship.
Lifting a container from stack to a ship.

What is a customs declaration?

A customs declaration is a document showing a list and detailed description of the goods imported or exported. Customs declarations are mainly submitted by travelers at the borders of individual countries upon arrival or departure.
Through customs declaration, customs authorities control the type of goods or items that are imported or exported. Essentially, it is used to determine import duties or to comply with export regulations during export or import.

Through customs declaration, customs authorities control the type of goods or items that are imported or exported. Generally, the control has two main purposes:

  • Import: Protect the country from goods that are harmful or dangerous to the economy and the environment.
  • Exports: Executive orders restrict the export of certain goods and impose surveillance measures.

Passengers who fail to declare their imported or exported goods correctly may be subject to fines or confiscated goods. However, in some cases, high import duties are imposed on certain goods to prevent citizens or businesses from importing them.

Who should file a customs declaration?

Generally, it is the owner of the goods or a person acting on his behalf (representative).
The person in control of the goods can also do it. These people may be individuals or companies, and in some cases associations of individuals.
As a rule, these people should be established in the EU.

Simplified customs declaration

Simplified Declaration (Article 166 UCC)

If certain details or documents are missing when submitting the declaration, the declarant is allowed to place the goods under the customs procedure on the basis of a simplified declaration. Abnormal use simplified declaration without authorization.

Centralised customs clearance (UCC Art. 179)

Customs declarations can be submitted to Customs at the MS where the Authorised Holder is located, regardless of whether the goods are submitted to Customs at another MS (Participating MS (PMS) - Submitting Customs). To do this, economic operators must obtain central clearing authorization.

Access to the filer's record (UCC s. 182)

The authorised holder may submit a customs declaration in the form of access to the declarant's record, provided that the details of the declaration are processed by customs at the time of submission. The way to enter the declarant's record can be by submitting the goods or not. For the latter additional conditions, must be satisfied.

This type of declaration is not suitable for all customs procedures (eg exclusion of transit).

Drafting customs declarations for goods belonging to different tariff subheadings (UCC Art. 177)

This simplification allows one customs declaration to be drawn up for goods under different tariff subheadings.
In this case, import or export duties must be levied according to the tariff subheading of the goods for which the highest duty is imposed.

Self-assessment (UCC Article 185)

This enables economic operators to perform certain customs formalities normally performed by customs, such as calculating customs duties, and to perform certain controls under customs supervision

/ By tjchinafreight ivy / Shipping

Do I need a license to export from the US?

Do I need a license to export from the US?
Do I need a license to export from the US?

What is an export license?

An export license is a government document authorizing or permitting certain export transactions, including technology exports. Export licenses are issued by the appropriate licensing agency after careful review of the facts regarding a particular export transaction.

Most U.S. export transactions do not require special approval from the U.S. government in the form of a license. In fact, only a small percentage of all U.S. export transactions require permission from the U.S. government. It is up to the exporter to decide whether the product requires a license and to study the end use of the product, in other words, to conduct "due diligence" on the transaction.

For most U.S. exports, the Bureau of Industry and Security or the U.S. Department of State's Defense Trade Controls Agency is the licensing agency.

Exporters should understand which federal department or agency has jurisdiction over the items they plan to export to determine whether a license is required.

Do I need a license?

This is one of the most frequently asked questions by trade experts in the U.S. Commerce Service Office network. The answer is usually no, as approximately 95% of all items exported from the United States do not require an export license. As a result, only a small percentage of U.S. export transactions require permission from the U.S. government.

These laws and regulations determine whether you can sell your product to international buyers, to which countries you can export it, and to which buyers you can sell. However, just because your product is among the 95% that don't require a license, doesn't mean you can sell it to anyone, anywhere.

It is up to the exporter to decide whether the product requires a license and to study the end use of the product, in other words, to conduct "due diligence" on the transaction.

For most U.S. exports, the Bureau of Industry and Security or the U.S. Department of State's Defense Trade Controls Agency is the licensing agency. Exporters should understand which federal department or agency has jurisdiction over the items they plan to export to determine whether a license is required.

Export Administration Regulations and Bureau of Industrial Security

Most U.S. procured items and some internationally procured items deemed dual-use (those with commercial and military or proliferation applications), as well as some purely commercial or purely munitions items, are subject to the Export Administration Regulations (EAR) and are and Security Bureau (Bank for International Settlements). The EAR controls exports for reasons of national security, foreign policy, supply shortages, nuclear non-proliferation, missile technology, chemical and biological weapons, regional stability, crime control, and counterterrorism.

Items within the U.S., certain items located outside the U.S., and certain U.S. activities are subject to the EAR. To determine if your item (commodity, software, or technology) is subject to the EAR, see the EAR's Commerce Control List (CCL) to see if it has an Export Control Classification Number (ECCN). If your item falls under the jurisdiction of the U.S. Department of Commerce and is not listed on the CCL, designate it as EAR99. Most EAR99 commercial products do not require a license to be exported. However, even EAR99 items may require a BIS export license depending on the item's destination, end user or end use.

/ By tjchinafreight ivy / International

Russia to update its strategy in WTO amid sanctions, says Putin

Russian President Vladimir Putin chairs the supervisory board meeting of the presidential forum "Russia - Land of Opportunity" at the Kremlin in Moscow, Russia April 20, 2022. 
Russian President Vladimir Putin chairs the supervisory board meeting of the presidential forum "Russia - Land of Opportunity" at the Kremlin in Moscow, Russia April 20, 2022. 

On the 20th local time, Russian President Vladimir Putin said at the Metallurgical Industry Development Conference that the illegal sanctions against Russia by the West are contrary to the principles of the WTO. Putin ordered the federal government to make an assessment of the legality of Western decisions on Russia's metallurgical industry by June 1.

Putin said that the demand for metallurgical products in the Russian domestic market needs to be stimulated, first of all, the demand for the construction industry. He said, "Europe ignores the interests of its own entrepreneurs, and the price of metallurgical products in Europe will rise, just like inflation." Putin also ordered that the update of Russia's strategy at the WTO is ready by June 1.

Putin said that Russia is one of the leaders in the world's metallurgical industry, and for foreign buyers, cooperation with Russia in this field is stable and mutually beneficial.

Putin: Russian SMEs can be more active in Russia-China joint projects

"China is our largest economic and trade partner, with (annual trade volume) more than 100 billion U.S. dollars. I will not talk about large-scale projects related to oil, natural gas, aviation, machinery manufacturing, nuclear energy, etc.," Putin said at the meeting. Under the current conditions, SMEs can participate more actively in various projects between the two parties."

TASS reported that Putin also believes that to develop cooperation with China, it is necessary for Russian entrepreneurs to master logistics and legal knowledge.

Regarding the non-profit organization "Russia - A Country Full of Opportunities", according to the organization's official website, the organization was established in 2018 under Putin's initiative. Able to develop their potential, implement business ideas or proposals related to social life. Entrepreneurs, volunteers, college students and other groups can exchange experiences through this platform.