Volume 25, Number 12
December 2, 2021
Oakland, California
SIGNALS™ provides detailed information on the regulations and activities of the US Federal Maritime Commission (FMC), and related developments in the ocean freight industry. For past issues, please consult our index.

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Signals™ Headlines - December 2, 2021

FMC Supply Chain Initiatives Teams Focus on Harbor Trucking

The Federal Maritime Commission's Supply Chain Innovation Teams have identified improvements to harbor trucking, specifically, the process and timing of return and delivery of containers to marine terminals, to improve conditions contributing to supply chain inefficiencies.

This announcement came from FMC Commissioner Rebecca Dye at a recent FMC meeting where briefings were provided on topics related to conditions in the marketplace for container shipping services, the current state of the ocean-linked supply chain, and the commercial and operational behavior of ocean carriers. Commissioner Dye is convening the teams under her authority as the Fact-Finding Officer for Fact Finding 29. Her goals for the Teams’ work are two-fold. First, for truckers to be able to return an empty container to a terminal and pick-up a loaded container, commonly referred to as a “double move.” The second is to bring certainty and predictability to the earliest return date process to address exporter complaints about the unreliability of the deadline for getting cargo to a terminal. Teams will focus their efforts on improving conditions at the Ports of Los Angeles and Long Beach and New York and New Jersey. They will be comprised of executives from each ocean carrier operating in an alliance and from the marine terminal operators that serve them.

“Achieving double moves for truckers would improve trucker productivity and remove a constant source of conflict over container return as well as resolve problems with appointment systems and chassis shortages. Earliest return date confusion is a terrible problem for U.S. exporters. This reform would also remove the constant problem to U.S. agricultural exporters of demurrage and detention charges that are not in compliance with our interpretative rule,” said Commissioner Dye.

New FMC Initiative to Focus on Shipping Data Standards and Access Protocols

Identifying data constraints that impede the flow of ocean cargo and add to supply chain inefficiencies will be the focus of a new Federal Maritime Commission effort to be spearheaded by Commissioner Carl W. Bentzel. This effort will be critical to pinpointing how data can contribute to the long-term reliability of the domestic cargo delivery system.

This new FMC initiative will propose recommendations for common data standards used by the international shipping supply chain, as well as access policies and protocols that would streamline information sharing across the ocean supply chain. This multi-phase effort is being launched at the direction of FMC Chairman Daniel B. Maffei with initial findings to be presented at a Maritime Data Summit in Spring 2022.

Over the course of the project Commissioner Bentzel will conduct research, interviews, round tables, and hold public meetings to inform the “status quo” in maritime data. He will explore what common ocean shipping data is created with each hand-off of a container through the supply chain, how that data is stored and shared, and identify what are the critical data elements used by each supply chain party. Ocean carriers, marine terminal operators, truckers, railroads, and other government agencies are among those who will be invited to provide insight about data definitions, classification, and recommendations for improving interoperability of data records involving container shipping. Input from the FMC’s National Shipper Advisory Committee may also be solicited as part of the project. Initial deliverables will include a data inventory and recommendations for common standards.

The first public meeting Commissioner Bentzel will hold is scheduled to take place in December in Washington, D.C. While the agenda for the meeting is still being set, planned speakers will include representatives from the Biden Administration, data experts, standards setting specialists, and representatives from FMC’s National Shippers Advisory Committee.

FMC Docket No. 21-09, Investigation of Hapag Lloyd’s Container Detention Practices

The Federal Maritime Commission has begun a formal investigation under its FMC Docket No. 21-09 to determine whether Hapag-Lloyd, A.G. and/or Hapag-Lloyd (America) LLC are violating or have violated section 41102(c) of the Shipping Act by failing to establish, observe, and enforce just and reasonable regulations and practices relating to its assessment of detention charges on containers when return locations with corresponding appointments were unavailable.

This is the first enforcement action taken by FMC since it established its Vessel-Operating Common Carrier (VOCC) Audit Program to investigate ocean carrier fees and surcharges earlier this year. Section 41102(c) of the Shipping Act provides that “A common carrier, marine terminal operator, or ocean transportation intermediary may not fail to establish, observe, and enforce just and reasonable regulations and practices relating to or connected with receiving, handling, storing, or delivering property.” On April 28, 2020, the Commission issued an interpretive rule in 46 CFR Part 545.5 providing guidance as to what it may consider in assessing whether a detention practice is unjust or unreasonable.

According to FMC Docket No. 21-09, Hapag-Lloyd is alleged to have issued invoices for container detention charges on dates in 2021 where it offered no return locations, or appointments were unavailable for the subject containers at the Ports of Los Angeles or Long Beach, California. The invoiced party provided Hapag-Lloyd with screenshots verifying these restrictions and requested a waiver for 11 container shipments. Hapag-Lloyd denied the request and said it was unable to waive the charges because it did not control the appointment system. In FMC’s view, this rationalization meets neither of the purposes of detention charges.

In view of the above, the Commission has decided that an adjudicatory proceeding is required to determine whether Hapag is in violation of the Shipping Act and FMC’s regulations by its practice of assessing detention charges when: either (a) Hapag Lloyd failed to provide an equipment return location, or (b) if Hapag Lloyd did provide an equipment return location, appointments were unavailable for equipment return during the allocated free time. Furthermore, upon such charges being disputed and evidence being produced to Hapag-Lloyd that no such appointments were available during free time, Hapag-Lloyd failed to waive detention. If so, this proceeding also shall determine whether civil penalties should be assessed and, if so, in what amount, and whether a cease-and-desist order should be issued.

West Coast MTO Agreement Increases PierPass Charge for Daytime Weekday Moves

The 12 container terminal members of the West Coast Marine Terminal Operator Agreement (WCMTOA) filed an amendment to their FMC Agreement to temporarily increases PierPass charges for daytime weekday moves effective December 1, 2021. The WCMTOA, FMC Agreement No. 201143-020, was amended to add Article XII which suspends the current PierPass Traffic Mitigation Fee (TMF) and implements a different TMF to be collected only between the daytime hours of 7:00 a.m. and 5:59 p.m. on weekdays. This new TMF and collection scheme is temporary and will be effective from December 1, 2021 through January 31, 2022.

The Federal Maritime Commission (FMC) granted an expedited review for this change to the WCMTOA and allowed it to take effect as announced. Effective December 1, 2021 the TMF will be USD 78.23 per TEU (twenty-foot equivalent unit) and USD 156.46 for all other sizes of container for non-exempt international container moves through the terminals at the Ports of Los Angeles and Long Beach between the daytime hours of 7:00 a.m. and 5:59 p.m. Monday through Friday. In other words, the TMF will only apply to weekday daytime moves. The temporary adjustment of the TMF provides for a financial incentive to move containers during off-peak hours by charging the TMF during peak hours only.

Prior to December 1, 2021, the PierPass Traffic Mitigation Fee (TMF) was a flat fee of USD 34.21 per TEU and USD 68.42 per FEU. The single flat fee was applicable on both daytime and nighttime container moves, across all hours of operation.

The TMF applies to non-exempt containers. Exempt containers include empty containers, import cargo or export cargo that transits the Alameda Corridor in a container and is subject to a fee imposed by the Alameda Corridor Transportation Authority, and transshipment cargo. Empty chassis and bobtail trucks are also exempt from the TMF. Effective December 1 through January 31, 2022, loaded container moves through the terminals from 6:00 p.m. through 6:59 a.m. Monday through Saturday and all day (24 hours) on Saturdays, Sundays, and holidays are also exempt from the TMF.

PierPass does not set a fee for less than containerload (LCL) shipments. NVOCCs who impose a PierPass fee for LCL shipments and/or a PierPass handling fee must file these fees in their FMC tariff rules, or clearly note these in their tariff rates, NVOCC Service Arrangements (NSAs), or NVOCC Negotiated Rate Arrangements (NRAs).

The Federal Maritime Commission (FMC) first authorized The West Coast MTO Agreement (WCMTOA) under FMC Agreement No. 201143 in June 2003. In 2005 the WCMTOA was amended to allow its members to create PierPass, Inc. and implement the “OffPeak program” to reduce severe cargo-related congestion on streets and highways around the Los Angeles and Long Beach ports. OffPeak established regular weeknight and Saturday work shifts to handle trucks delivering and picking up containers at marine terminals and implemented the PierPass TMF. In November 2018 FMC approved the change of the TMF to a flat fee for container moves on all shifts, known as PierPass 2.0. The new Article XII to the WCMTOA was filed with FMC on November 8, 2021. FMC allowed the change to go into effect after an expedited review.

Transpacific Eastbound Carriers Adjust Fuel Surcharges Effective January 1, 2022

Several carriers serving the East Asia/USA trade lanes (U.S. Imports) have adjusted fuel surcharges effective January 1 through March 31, 2022. Details are as follows.

Here is a table of BAF amounts posted by carriers; amounts for all other container sizes are as per formula:

TRANSPACIFIC EASTBOUND (Asia to USA)
BUNKER ADJUSTMENT FACTOR (BAF), Jan – Mar 2022, in USD, per 40ft ctr, except as noted below
Carrier
To US Atlantic/Gulf Coast Ports
To US Pacific Coast Ports
To IPI/MLB via US Pacific Coast
Dry
Reefer
Dry
Reefer
Dry
Reefer
CMA CGM
(see notes 1, 7)
968
1161
594
712
594
712
COSCO
(see note 2)
1178
1989
612
1034
612
1034
Evergreen
(see note 7)
1171
1692
500
796
500
796
HMM
(see notes 3, 8)
1209
676
1014
ONE
(see notes 4, 7)
438
694
270
380
582
692
OOCL
(see notes 5, 8)
1159
1956
643
1085
946
1597
Yang Ming
(see note 7)
696
1002
378
544
378
544
ZIM
(see notes 6, 7, 8)
989
1484
579
869
579
869

NOTE 1: CMA CGM calls the above Bunker surcharge the Bunker Adjustment Factor Surcharge (BAF03), tariff Rule No. 010.08.

NOTE 2: COSCO calls the above charge the Bunker Charge (BUC), tariff Rule 010-003.

NOTE 3: HMM calls the above charge the Bunker Charge, tariff Rule 2-63. HMM also filed in its FMC tariff Rule 2-95, Environmental Compliance Charge (ECC), effective January 1, 2022. The ECC amounts are USD200/223/250/282 per 20/40/40HC/45ft, respectively, for destination USWC/USWC Local/IPI/MLB; and USD360/400/450/507 per 20/40/40HC/45ft, respectively, for destination USEC (all water)/USGC/RIPI.

NOTE 4: ONE calls the above Bunker surcharge the ONE Bunker Surcharge (OBS). Any reference to Bunker Adjustment Factor (BAF) or Fuel Adjustment Factor (FAF) within a duly filed service contract shall be construed as referencing the same surcharge as ONE Bunker Surcharge (OBS) as detailed within tariff Rule No. 102.001, whether as an exception or as a reference to this charge.

NOTE 5: OOCL calls the above Bunker surcharge the Fuel Cost Recovery Charge (T-62). The Fuel Cost Recovery Charge will not apply to shipments when Bunker Surcharge and/or Low Sulphur Fuel Surcharge and/or Low Sulphur Adjustment Charge are already applied or included in the base rate. The Fuel Cost Recovery Charge is effective December 1, 2021, until further notice.

NOTE 6: ZIM calls the above Bunker Charge the New Bunker Factor - Far East (NBF), Rule 010-NB. Service contract cargoes subject to Carrier’s published BAF and/or EBS shall not be subject to NBF.

NOTE 7: Subject to Low Sulphur Fuel Charge (LSF or LSS).

NOTE 8: Updated on a monthly basis.

Each carrier maintains its own tariffs and controls its own pricing.

Transpacific Eastbound Carriers File GRIs Effective December 15, 2021, and January 1, 2022

Several leading carriers serving the Transpacific container trades have recently updated their respective tariffs to include new General Rate Increases (GRIs) effective December 15, 2021, including COSCO, Evergreen, HMM Company Limited, Ocean Network Express (ONE), and ZIM. See table below for GRI amounts per 40ft container; GRI amounts for all other container sizes are as per formula. The December 15th GRIs will be the twenty-fourth GRI of 2021 for the East Asia/USA trade lane.

TRANSPACIFIC EASTBOUND (Asia to USA)
GENERAL RATE INCREASE (GRI)
Effective December 15, 2021
Carrier
in USD, per 40ft ctr
COSCO (see note 1)
1000
Evergreen (see note 2)
1000 / 2000
HMM (see note 3)
1000 / 2000
ONE
1000
ZIM
1000

NOTE 1: COSCO GRIs apply on all cargo moving under service contracts only.

NOTE 2: Evergreen GRIs will be USD 1000 per 40ft dry container for dry cargo, and USD 2000 per reefer container. GRI amounts for all other container sizes are as per formula.

NOTE 3: HMM GRIs will be USD 1000 per 40ft container for cargo to destinations USWC, USEC, US Gulf coast, and USD 2000 per 40ft container for cargo to destinations IPI, MLB, RIPI. GRI amounts for all other container sizes are as per formula.

Some carriers also updated their tariffs to include new General Rate Increases (GRIs) effective January 1, 2022, including COSCO, Evergreen, HMM Company Limited, Ocean Network Express (ONE), Yang Ming, and ZIM. See table below for GRI amounts per 40ft container; GRI amounts for all other container sizes are as per formula. The January 1st GRIs will be the first GRI of 2022 for the East Asia/USA trade lane.

TRANSPACIFIC EASTBOUND (Asia to USA)
GENERAL RATE INCREASE (GRI)
Effective January 1, 2022
Carrier
in USD, per 40ft ctr
COSCO (see note 1)
1000
Evergreen (see note 2)
1000 / 2000
HMM (see note 3)
1000 / 2000
ONE
1000
Yang Ming (see note 4)
1000 / 2000
ZIM
1000

NOTE 1: COSCO GRIs apply on all cargo moving under service contracts only.

NOTE 2: Evergreen GRIs will be USD 1000 per 40ft dry container for dry cargo, and USD 2000 per reefer container. GRI amounts for all other container sizes are as per formula.

NOTE 3: HMM GRIs will be USD 1000 per 40ft container for cargo to destinations USWC, USEC, US Gulf coast, and USD 2000 per 40ft container for cargo to destinations IPI, MLB, RIPI. GRI amounts for all other container sizes are as per formula.

NOTE 4: Yang Ming GRIs will be USD 1000 per 40ft container for cargo to destinations USWC, USEC, US Gulf coast, and USD 2000 per 40ft container for cargo to destinations IPI, MLB, RIPI. GRI amounts for all other container sizes are as per formula.

Transpacific Westbound Carriers Update Fuel Surcharges Effective January 1, 2022

Several carriers serving the USA/East Asia trade lanes (U.S. Exports) have adjusted their fuel surcharges for the January to March 2022 quarter. Here is a table of carriers that have posted BAF amounts; amounts for all other container sizes are as per formula:

TRANSPACIFIC WESTBOUND (USA to Asia)
BUNKER ADJUSTMENT FACTOR (BAF), Jan – Mar 2022, in USD, per 40ft ctr, except as noted below
Carrier
Dry Cargo
Reefer Cargo
From US Atlantic/Gulf Coast Ports
From US Pacific Coast Ports
From US Atlantic/Gulf Coast Ports
From US Pacific Coast Ports
CMA CGM
(see notes 1, 7)
42
21
67
46
COSCO
(see note 2)
219
121
329
182
Evergreen
(see note 8)
278
138
741
388
HMM
(see note 3)
264
380
2206
1282
ONE
(see notes 4, 8)
210
136
466
246
OOCL
(see notes 5, 9)
130
106
195
159
Yang Ming
(see notes 6, 8)
300
180
1002
544
ZIM
(see notes 7, 9)
94
55
141
83

NOTE 1: CMA CGM calls the above Bunker surcharge the Bunker Adjustment Factor Surcharge (BAF-03), tariff Rule No. 010.4.

NOTE 2: COSCO calls the above surcharge the Bunker Surcharge (BUC), tariff Rule No. 010-001.

NOTE 3: HMM calls the above charge the Bunker Surcharge (BUC) Rule No. 10-02A.

NOTE 4: ONE calls the above Bunker surcharge the ONE Bunker Surcharge (OBS). Any reference to Bunker Adjustment Factor (BAF) or Fuel Adjustment Factor (FAF) within a duly filed service contract shall be construed as referencing the same surcharge as ONE Bunker Surcharge (OBS) as detailed within tariff Rule No. 102.001, whether as an exception or as a reference to this charge.

NOTE 5: OOCL calls the above Bunker surcharge the Fuel Cost Recovery Charge (T-62). The Fuel Cost Recovery Charge will not apply to shipments when Bunker Surcharge and/or Low Sulphur Fuel Surcharge and/or Low Sulphur Adjustment Charge are already applied or included in the base rate. The Fuel Cost Recovery Charge is effective December 1, 2021, until further notice.

NOTE 6: Yang Ming calls the above Bunker surcharge the New Bunker Charge, rule number 10-AH.

NOTE 7: ZIM calls the above Bunker Charge the New Bunker Factor - Far East (NBF), Rule 010-NB.

NOTE 8: Subject to Low Sulphur Fuel Charge (LSF or LSS).

NOTE 9: Updated on a monthly basis.

Each carrier maintains its own tariffs and controls its own pricing.

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