NCC on Tuesday joined over 100 companies and associations in a letter supporting the Ocean Shipping Reform Act of 2021 (OSRA). The bill addresses unreasonable ocean carrier practices that have resulted in delays and fees to agricultural exporters.
The OSRA, introduced by Reps. John Garamendi (D-CA) and Dusty Johnson (R-SD), would update the Shipping Act – which governs the practices and authorities of the Federal Maritime Commission (FMC) – to address a growing shipping crisis.
Vessel-operating common carriers (VOCCs) have been delivering massive volumes of imported shipments to U.S. ports and then elected to leave without refilling empty containers with American goods and products. Whereas shipping containers filled and imported goods are normally unloaded, sent to rural areas, filled with agricultural commodities and then shipped abroad, the lucrative freight rates paid by the import cargo, combined with congestion at ports on the West and East Coasts are leading VOCCs to immediately return empty containers to their overseas ports of origin.
Port congestion is exacerbated by a lack of sufficient labor and automation, a lack of appointments for truckers to enter terminal gates to retrieve import containers, or bring in containers with export cargo, or empty containers, carrier + chassis company agreements causing shortages of chassis to carry the containers in and out of the terminals, lack of capacity of near-port distribution centers to accept/process massive volumes of import cargo. Additionally, this situation is exacerbated by carriers’ failure to provide accurate notice to U.S. exporters of arrival/departure and cargo loading times, then imposing financial penalties known as detention or demurrage fees on exporters for “missing” those windows. The FMC has found this practice to be unreasonable.
“Over 150 Members of Congress have written urging prompt Federal initiative,” the letter read. “The House Committee on Transportation and Infrastructure hearing, President Biden’s Executive Order 14036, and Secretary of US Department of Transportation Buttigieg’s recent port Roundtable all confirm that current law and regulation are insufficient to protect the ocean shipping interests of US exporters and importers.”
“We strongly support provisions in your bill to gain reasonable and fair ocean carrier practices consistent with the Federal Maritime Commission’s excellent Interpretive Rule on Demurrage and Detention – which unfortunately has gone unheeded,” the letter continued. “It imposes upon carriers the obligation to self-police compliance with that Rule. In addition, the bill obligates ocean carriers to carry export cargo, to the extent they can do so safely. It addresses carrier practices limiting efficient use of containers, chassis and other equipment.”
The full text of the letter can be found here. A summary of the bill can be found here and the full text of the bill can be found here.
