On Tuesday August 10, U.S. House Representatives John Garamendi (CA) and Dusty Johnson (SD) introduced the Ocean Shipping Reform Act of 2021. In order to support the competitiveness of U.S. businesses that are reliant on maritime shipping transport, the bipartisan bill aims to crack down on unreasonable practices by container shipping lines, bolster U.S. enforcement against bad actors, and improve transparency for exporters.
Western Growers President and CEO Dave Puglia issued the following statement:
“Western Growers strongly supports the efforts of Reps. Garamendi and Johnson to ensure fair shipping practices and standards for our agricultural exports. At a time when our farmers are still pressing to regain lost overseas markets after years of trade upheaval, the ongoing West Coast port crisis and skyrocketing shipping costs are diminishing their opportunity do to so. The Ocean Shipping Reform Act of 2021 provides much needed oversight and transparency into maritime shipping practices, which have increasingly become too unpredictable or costly for our exporters to remain globally competitive. As this legislation moves forward, we continue to encourage other federal and state officials to remain engaged on this crisis and explore other immediate relief measures for the supply chain.”
The bill will, among other provisions:
- State that carriers (e.g. container shipping lines) may not unreasonably decline export cargo if it can be loaded safely, can arrive timely to be loaded, and is destined to a location to which the carrier is already scheduled.
- Require carriers to provide notice of cargo availability, container return locations, and adequate notice of dates when the export container must arrive at the terminal.
- Require carriers to provide the shipper with specific information to justify any imposed demurrage-detention charges, provide a reasonable dispute resolution process, and certify compliance with existing federal regulation.
- Require carriers, under defined conditions, to accept export cargo bookings.
An Ongoing Crisis
Since the fall of 2020, U.S. agricultural exporters have faced extreme challenges getting their products onto ships and out to foreign buyers, including record-breaking congestion and delays at ports, shipping lines’ persistent failure to provide accurate notice of arrival/departure and cargo loading times, excessive financial penalties and other fees, and skyrocketing freight rate costs. Unfortunately, this situation remains fluid with no clear end in sight; based on current projections, we may not see a return to normal until early 2022, all but guaranteeing tough months ahead for those commodities whose peak shipping seasons fall between September and March.
Western Growers Action
Foreign markets are critical to our members, especially those that produce tree nuts and citrus. Earlier this year, Western Growers supported an industry letter that urged the U.S. Department of Transportation to consider its existing powers and determine how it can assist with the transportation needs of U.S. ag exporters in overcoming the current challenges in shipping goods and products. With its allies and the Agricultural Transportation Coalition, WG also pressed the U.S. House Committee on Transportation and Infrastructure to hold a hearing examining this ongoing crisis. It was ultimately held on June 15, marking the first time in many years the committee had looked closely at this issue, and with several Members of Congress calling for stronger action on behalf of U.S. ag exporters. A recording of the hearing can be viewed here.
We continue to press for action from the Administration, as well as state and local officials, to engage the marine transport supply chain – particularly the shipping lines and terminals – to find solutions and relief.
**If your business is having problems with exporting – including high detention/demurrage or other questionable fees, excessive delays or cancellations, and carrier unresponsiveness – please contact Tracey Chow (firstname.lastname@example.org, 202-704-7312)