Sequestration Effects on the US Supply Chain

No doubt the US government needs to do a bit of fiscal trimming, however the process for automatic across the board cuts to government agencies set to begin March 1, may be a major shock to a fragile economy, if indeed it occurs. Some economists have noted GDP may slow by 0.4% this year, down from about 2% to 1.6% as a result of these automatic cuts. With total cuts amounting to about $1.2 trillion over the next ten years, it is anybody’s guess to what the effects may bring.

The cuts are to be split 50-50 between defense and domestic discretionary spending. For the supply chain industry, this means cuts to such government agencies as the Department of Health and Human Services’ Food and Drug Administration (FDA), the Department of Transportation’s Federal Aviation Agency (FAA) as well as to the Department of Homeland Security’s Customs Border and Patrol (CBP). Many other agencies will also see financial cuts that could negatively affect the supply chain industry.

For logistics providers providing services such as temperature-controlled warehousing and distribution, fiscal cuts could mean delays in SpelcategorieInzet % BijdrageSlots (alle varianten in Casino Red)100%Scratch Cards (In Soft games)Table games en Video Poker10% roulette en Baccarat0%Algemene voorwaardenVerantwoord weddenUnibet is opgericht door spelers, voor spelers. inspections, certifications and recall notifications, which could endanger the safety of the pharmaceutical and food supplies.

According to the Federal Aviation Agency, the mandatory cuts could possibly mean eliminating some airport control towers all together and eliminating overnight staffing at other control towers.

This would impact air cargo carriers such as FedEx and UPS, who utilize night flights to move a significant amount of cargo.

Like other government agencies, along with spending cuts, the Customs Border and Patrol De speler wordt partij bij will face mandatory furloughs beginning in April. Entering the country, whether along the Mexican or Canadian border, a port or airport will result in a longer wait. According to the CBP, cargo release wait times at border entry points will double from the current two hours to about four to five hours.

March will be quite interesting on Capitol Hill. Not only is sequestration likely to occur March 1, but the six month government budget extension expires March 27. It’s possible the government will combine both issues and come to a resolution prior to March 27 or it will face the possibility of a government shutdown come March 28. Either way, people should expect US supply chains to not only get longer, but also more complicated.

Source: Transport Intelligence, FEBRUARY 28, 2013

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The Importer Security Filing (ISF)

The Importer Security Filing (ISF), also known as 10 2, is a US Customs and Border Protection (CBP) regulation that requires importers and vessel operating carriers to provide advance data electronically to CBP for in-bound ocean shipments. The main purpose of these entries is to determine the shipments with US destination in advance and ensure the safety of America’s borders.

Below information should be submitted by each ISF entry:

  • Importer of record number: Internal Revenue Service (IRS), Employer Identification Number (EIN), Social Security Number (SSN), or CBP assigned number of the entity liable for payment of the duties and responsible for meeting requirements incurred as a result of importation.
  • Consignee Numbers: Internal Revenue Service (IRS), Employer Identification Number (EIN), Social Security Number (SSN), or CBP assigned number of the individual(s) or firm(s) in the United States on whose account the merchandise is shipped.
  • Seller Name & Address: Name and address of the last known entity by whom the goods are sold or agreed to be sold.
  • Buyer Name & Address: Name and address of the last known entity to whom the goods are sold or agreed to be sold.
  • Ship to Name & Address: Name and address of the first deliver-to party scheduled to physically receive the goods after the goods have been released from customs custody.
  • Manufacturer Name & Address: Name and address of the supplier of the finished goods in the country from which the goods are leaving.
  • Country of origin: Country of manufacturer
  • Commodity HTS Code: The number under which the commodity is classified in the Harmonized Tariff Schedule of the United States.
  • Container Stuffing Location: Name and address of the physical location where When playing our casino games , keep in mind the following:Gamble Aware Special limits are easy to set and help you control the amount you put into your account over a particular time period. the goods were stuffed into the container.
  • Consolidator Name & Address: Name and address of the party who stuffed the container or arranged for the stuffing of the container.

What happens if ISF is not filed timely or properly:

CBP could assess penalties up to $10,000 per ISF for one or more of the following violations:

Late ISF: if the ISF is not filed at least 24 hours prior to lading aboard a vessel destined to the USA CBP could charge $5,000 penalty. This includes untimely filing of an ISF update and/or flexible ISF filing.

Inaccurate ISF: CBP also assess $5,000 per inaccurate and/or incomplete ISF filing. This includes missing and/or incorrect AMS bill of lading number representing. Incomplete or inaccurate AMS bill of lading with SCAC code at the lowest bill level (AMS house bill) is one of the most common problem. Please ensure that the bill of lading number provided by your carrier or freight forwarder is the correct and complete number that was transmitted to CBP in AMS to avoid a mismatch. Incorrect/incomplete names and/or addresses of the parties or other required data can also lead to penalties.

Amendments: Inaccurate or incomplete data requires the filing of an ISF amendment to CBP upon discovery. Certain “flexible” data elements used due to unknown facts at the time of filing must be corrected and transmitted to CBP no later than 24 hours prior to arrival in the USA, or it is subject to penalty.

Always keep that in mind that under the ISF final rule, ultimate responsibility for ISF and correctness of the data rests with importer. Therefore always make sure that ISF is filed timely and properly. Before you import, know what you are importing and identify the proper HTS numbers earlier in the process. Also decide who will transmit the ISF and send necessary documents to related party in order authorize them timely.

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ILA port strike averted, negotiations extended for 30 days | Update: 12/28/2012

The following information is an update from “The Houston Business Journal
Tentative OK reached on key issue of container royalties.

The International Longshoreman”s Association and waterfront management, averting a possible Dec. 30 strike that would have paralyzed shipping at 14 U.S. ports, have extended their current contract for an additional 30 days after reaching a compromise on what became the lightning-rod issue of container royalty payments to union members.

In a statement issued today, the Federal Mediation & Conciliation Service, which has been mediating talks since early in the week, said the two sides agreed to extend their collective bargaining agreement, which was set to expire tomorrow, until Jan. 28.

Without a new contract or an extension, 14,500 ILA members were set to strike on Sunday, shutting down port operations from Maine to Texas. The extension keeps the retail supply chain open for business during the shipping season leading up to the spring buying cycle.

During the next 30 days, the ILA and the U.S. Maritime Alliance, representing waterfront management, will negotiate in a bid to resolve all remaining issues standing between them and labor peace at the ports.

USMX has proposed Angels Camp a six-year contract, which would run until the start of 2019 if both sides agree to terms in the next month.

FMCS said the two sides reached an “agreement in principle” on container royalties that have been paid to ILA workers every year since 1960. George Cohen, the agency”s director, would not disclose details of the agreement on the controversial issue. He said that it represents “a major positive step toward achieving an overall collective bargaining agreement.”

Cohen said he was “cautiously optimistic” that a new contract can be reached by end of January.

In separate statements today, Tous les casino en ligne s, dans la plupart des jeux ont une cote elevee a l’interieur de leur faveur. the National Retail Federation (NRF) and the Retail Industry Leaders Association, (RILA) which combined represent the U.S. retailing universe, welcomed the extension but urged both sides to stay at the bargaining table until a contract is reached.

“Retailers welcome news that the ports will remain open for business through the busy spring shipping season. Retailers are however eager to see the parties reach a long-term agreement that will ensure stable and predictable operations at East and Gulf Coast ports,” said Kelly Kolb, vice president for government affairs.

The royalty payments were originally designed to compensate workers at the Port of New York and New Jersey for lost jobs and wages stemming from containerization and automation practices. Over the years, the royalty program became a core component of every contract, and covered all ILA members.

Last year, workers received, in aggregate, $211 million in royalty payments, roughly equal to 10 percent of container revenues at the ports, according to management. Based on the size of ILA”s current membership, the payment stream provided each worker with about $15,500 last year.

USMX, which views the entire payment scheme as a relic of a bygone era, sought to freeze future payments at 2011 levels and not allow new hires to participate. The ILA believed the issue is part of the basic contract, and should be taken off the table entirely.

Management”s refusal to do so led the ILA to decline Cohen”s Dec. 18 offer to extend the current contract until Feb 1. With no new talks scheduled at the time, the seagoing supply chain effectively abandoned all hope of a settlement and began preparing for a walkout Dec. 30.

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ILA & USMX Contract Negotiations | Update: 12/26/2012

The following is the latest information on the issue, provided by “American Shippers”

News on Wednesday, December 26, 2012

ILA, USMX agree to meet as strike deadline looms
The U.S. Federal Mediation and Conciliation Service (FMCS) director said the International Longshoremen”s Association and the group trying to negotiate a new contract with them, the U.S. Maritime Alliance, have agreed to meet before their current pact expires on December 29, 2012.  FMCS Director George Cohen has called a meeting of the ILA and the Maritime Alliance in advance of the December 29th expiration of the contract extension. The parties have agreed to attend.”

We have included the terminal plans of action we have received.

– FIT (Florida International Terminal):
Plan of action if there is a strike is to certainly facilitate as much as they can, the delivery of the import containers to our customers but at the same time they will be emphatic that no reefers are to remain in their yard past the deadline of Dec. 29th 2012.
Note: monitoring issue, with no ILA personnel available to oversee the proper functioning of containers they cannot and will not assume the responsibility of perishable cargoes being spoiled, losing market value or simply deteriorating due to its limited shelf life. Secondly, their inability to enter the terminal yard will not permit them to ensure their electricity generating equipment will continue operating properly while the strike is in effect. That, will represent a high risks for claims that FIT is not willing nor are in a position to responsibly accept.

– The Port of Virginia:
Is prepared should a work stoppage occur.  The Virginia Port Authority (VPA) and its private terminal operating company, Virginia International Terminals Inc. (VIT), will do all that is possible to expedite the flow in and out of our marine terminals prior to this labor action.

– POMTOC (Port of Miami):
In the event of a work stoppage, ILA work jurisdiction will be respected. What this means is that NO VESSEL OR GATE ACTIVITY will take place for the duration of the work stoppage.

– Port Everglades:
Has plans in place to ensure the safety and security of the Port and the continuation of normal operations at facilities not affected by any potential labor actions on December 30th.
– Port of West Palm Beach:
Their terminals will not be affected by the union. They hire trucker to move their cargo and do not anticipate any issues.

– Maher Terminal:
They urge that all import cargo be removed from their facility by close of business Friday, December 28, 2012. Any cargo remaining on terminal after a strike commences will not be available until after a work stoppage ends despite the commodity. Taking delivery prior to closing of business on December 30th will prevent exposure to unavailability and added expense. The terminal hours for December 26 through December 28, 2012 will be as follows:

Main Terminal/Chassis Depot
Delivery of Imports: 6am – 10pm
Receipt of Exports: 6am – 10pm
Reefer Processing: 6am – 9pm
Receipt of Empties: 6am – 4pm

Off Terminal Empty Depot/Auxiliary Depot
Receive Empties: 6am – 4pm
Deliver Empties: 6am – 4pm
– PNCT (Port Newark Container Terminal):
Has developed a detailed contingency plan to ensure that they take the

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appropriate steps in the event of a work stoppage.
1) No vessel activity will be performed during any work stoppage. Once the work stoppage has ended, PNCT will work with the carriers to schedule the resumption of vessel operations. 2) Gates:
There will be no gate activity during any work stoppage. PNCT began extended gate hours on Monday Dec. 17 and will continue to operate extended hours through Dec. 28th to allow as much cargo as possible to be delivered. PNCT will operate a Saturday gate on Dec. 29 from 0800 – 1500. They will continue to meet with CBP to ensure they have the staffing to support their extended gate operations.
3) Demurrage / Storage:
4) Section 8 C. of the NYTC Tariff will apply for all demurrage during the work stoppage. They urge all customers to make every effort to pickup any Reefer import cargo that is available, prior to the start of any work stoppage.
PNCT will make every effort to protect any reefer cargo on terminal during the work stoppage; however they strongly suggest that you consider alternatives with regard to delivering export reefer cargo to PNCT during this period.

– Horizon Lines:
If a work stoppage does occur, they may not be able to transport cargo already accepted & agreed to be transported during the work stoppage. Noting respect for the process of collective bargaining, they would like to encourage you to take steps to mitigate the risks related to a work stoppage by:
1) Taking proper precautions with all highly perishable cargo products, noting delays of several days to more than a week are possible.
2) Ensuring all hazardous waste and hazardous materials shipments are promptly removed from ocean terminals to prevent safety risks or regulatory violations.
3) Ensuring all cargo discharged from vessels prior to December 29th is promptly removed from ocean terminals to ensure access to already-shipped products.

New Dimension Logistics (NDLX) will continue to monitor the situation and compile terminal and carrier contingency plans to keep you informed.

Please note, New Dimension Logistics provides Global Air Freight solutions in the unfortunate event an agreement between ILA and USMX is not reached before their current pact expires on December 29, 2012.

Here”s a link to view our Air Freight Services

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Happy Holidays from New Dimension Logistics!


"You Ask, We Deliver....For The Holidays!"

The staff at New Dimension Logistics would like to wish you a joyous and safe holiday season. We have enjoyed tremendous growth in 2012, and looking forward to the opportunity to serve you in 2013.

Let us continue to help your company select online casinos the right supply chain solution through our unique service offerings: Global Air & Ocean Freight Forwarding, On-board Courier Service, Customs Brokerage, 3PL/Transportation Management, Truckload & LTL, Intermodal Services, and Warehousing. We pride ourselves in providing world-class, quality service for on time delivery of your transportation and logistics needs.

Best Wishes,

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