May at-a-glance … materials & handling

FMC forming advisory committee on international ocean freight system

The Federal Maritime Commission (FMC) is forming a Shipper Advisory Committee comprised of 12 importers and 12 exporters to advise the agency on “competitiveness, reliability, integrity and fairness of the international ocean freight delivery system.” Among the first topics of discussion is the current container shortage and resulting shipping delays. According to FMC Chair Daniel B. Maffei, the U.S. has seen months of record-setting imports that have clogged ports across the country. “What we’re really talking about is the lack of capacity of the system in the U.S. … to handle this level of cargo.” Maffei also supports Congress updating the 1984 Shipping Act to reflect industry changes since the Act was passed. For example, the number of major carriers has decreased from 22 to just 9, and while there were some U.S.-based carriers in 1984, all are now foreign based.

NAFEM members are encouraged to share their recent ocean freight experiences with Transportation Secretary Pete Buttigieg via email or in writing at The Honorable Pete Buttigieg, U.S. Department of Transportation, 1200 New Jersey Ave., SE, Washington, DC 20590.

Global shipping challenges escalate with arrest of Ever Given

The perfect storm of delays at West Coast ports, backlogs in the Suez Canal due to the grounding of the Ever Given, and the massive container ship’s seizure by Egyptian courts, is further exacerbating worldwide shipping delays, according to the Freightos online shipping marketplace.

U.S. ports continue to be overwhelmed by demand, with multiple ships waiting outside several major West Coast ports. As a result, importers are turning to air cargo, driving up prices and limiting availability.

Additionally, while the huge Ever Given container ship was cleared from the Suez Canal in late March, it delayed hundreds of ships during the six days it was stuck. These delayed vessels and scheduled ships overwhelmed ports worldwide when they arrived at the same time.

Egyptian authorities also “arrested” the Even Given and will not release the ship or the containers it holds until the ship’s owner, Japan’s Shoei Kisen Kaisha Ltd., pays a $600 million insurance claim to the Suez Canal Authority.

According to American Shipper, maritime sources with knowledge of the Ever Given’s manifest say the vessel’s 18,300 containers hold electronics, machinery and parts, household goods, furniture and footwear.

“It would be an absolute logistical nightmare to get the Ever Given unloaded and reloaded onto other vessels,” said Paula Bellamy, managing director of Ocean Wide Logistics (OL) Dubai. “In addition to the cost element of double handling the containers, there is cargo on board with expiration dates. Customers have no idea when they will be able to receive these goods.”

In a recent NAFEM Wednesday Webcast, Josh Zive, senior principle, Bracewell LLP and the Coalition of American Metal Manufacturers and Users (CAMMU), said international shipping issues and material shortages are shedding further light on the Trump and Biden administrations’ aims to reorient supply chains closer to home. “The shortage of semi-conductors impacted by these shipping challenges is further proof of the need to create domestic supply chains.”