Eastern Shipping Worldwide

In this November 2024 newsletter, we cover key industry updates, including Canada’s intervention to end port shutdowns, looming license risks for over 177,000 commercial drivers, and the lifting of flight restrictions on Chinese carriers. We also highlight customs news, such as the USTR's delay in Section 301 tariff changes and the USITC's ruling on aluminum imports. Additionally, a reminder about the upcoming Lacey Act declaration deadline and Eastern's participation in the Making Strides Against Breast Cancer walk, raising over $1,800, wraps up the edition.

Ports across British Columbia are bracing for a strike today after talks to renew a collective agreement, which expired in March, failed to yield a deal. The B.C. Maritime Employers Association (BCMEA) presented a final offer over the weekend, but it was swiftly rejected by the International Longshore and Warehouse Union (ILWU) Local 514. With federal mediators on site, efforts to avoid disruption at major ports like Vancouver continue. However, the BCMEA has already issued a notice to lock out ILWU members, effective 8 am local time. The impact of last year’s 13-day port strike, which cost Canada’s economy hundreds of millions, looms large as similar tensions mount in Montreal, Canada’s second-largest port. https://lnkd.in/g9bZd39S

MEA Urges Government Intervention as Strike Looms at Montreal Terminals The Maritime Employers Association (MEA) is bracing for an indefinite strike starting Thursday at 11 a.m., set to impact Viau and Maisonneuve terminals operated by TerMont. After hours of unsuccessful discussions, the MEA has formally requested that Canada’s Minister of Labour, Mr. Steven MacKinnon, appoint a special mediator to help resolve the ongoing labor dispute with the Longshoremen's Union by December 3, 2024. The MEA warns that the strike will disrupt operations and harm the financial health of affected companies already facing declining volumes, urging swift government action to prevent further economic impact. To view the latest MEA negotiation updates, visit: https://lnkd.in/gYhD-xpW

Eastern proudly joined the American Cancer Society’s Making Strides Against Breast Cancer walk on October 26, 2024, in Naples, Florida. Joining as part of the team “Pink DIVAS FIGHTING for a CURE!,” Eastern’s Catherine Wagner, Mayra Tang, Estefany Ortiz, Oriana Suarez and Carla Ramirez walked alongside other dedicated team members, collectively raising $1,871.80 and ranking 17th among 121 teams. Through events like Making Strides, Eastern and its partners stand united with communities across the country in a collective mission to end breast cancer and support survivors and their caregivers. https://lnkd.in/gsSSwBRG                        

Port of Montreal labor dispute: Union calls 24 hour strike The Longshoremen’s Union, CUPE Local 375, has called a 24-hour strike at the Port of Montreal from Sunday, October 27, 2024, at 7:00 a.m. to Monday, October 28, 2024, at 6:59 a.m., resulting in a complete work stoppage, including at the Contrecœur terminal. This strike follows a three-day walkout in September and ongoing overtime halts, contributing to a 24% decrease in cargo volumes since 2022. The Maritime Employers Association (MEA) has highlighted the economic implications for various sectors reliant on the port and expressed concern that prolonged disputes may drive shippers to other ports. Despite recent mediation attempts by Canada’s Labour Minister, no agreement has been reached, leaving both parties at an impasse. The MEA is committed to continuing negotiations with the Federal Mediation and Conciliation Service in hopes of resolving the dispute.

Chicago cargo theft highlights larger challenges for intermodal container moves The recent theft of cargo from a Union Pacific (UP) train in Chicago underscores the significant challenges associated with intermodal container security, particularly during rail interchanges in urban areas. Video footage captured the suspects specifically targeting a few Hub Group containers and rail-owned “EMP” boxes containing electronics, raising suspicions of insider knowledge due to the selective nature of the theft. The train, caught in an interchange between UP and Norfolk Southern Railway, was reportedly stationary in a residential area—an unusual circumstance for secure interchanges. While six individuals were detained, only two face misdemeanor charges, reflecting broader law enforcement limitations on addressing cargo theft. Memphis police also highlighted similar security concerns, noting that intermodal trains can remain stationary for extended periods in unsafe locations. Additionally, the lack of severe legal repercussions for cargo theft, particularly outside foreign trade zones, complicates efforts to deter such crimes. Authorities emphasize the need for more comprehensive federal prosecution strategies to address the economic impact of these thefts effectively. https://lnkd.in/g46dYexm

Tariff Tensions Between China, U.S. Spark 'Sharp Change' in Trade With Mexico Rising trade tensions between the U.S. and China have shifted a significant portion of Chinese container imports to Mexico, as shown by Vesselbot's data. Between January and June 2024, imports from China to Mexico surged by 61%, with Mexico's major ports, Manzanillo and Lazaro Cardenas, seeing substantial growth. This trend raises concerns about Chinese goods using Mexico as a gateway to bypass U.S. tariffs imposed during the trade conflict. Although President Biden introduced tariffs on Mexican-imported steel and aluminum, many Chinese goods continue to avoid direct U.S. tariffs by entering through Mexico. https://lnkd.in/gvJCSN7t

Port of Los Angeles freight rail delays reach two-year high, with holiday and everyday items piling up Freight rail delays at the Port of Los Angeles have reached a two-year high due to record imports caused by East and Gulf Coast strike diversions and Red Sea issues. Containers are sitting for nine-plus days, nearly doubling the previous average dwell time of four days. Despite increased volumes, port officials claim operations, including vessel and trucking services, are running smoothly. Retailers and chemical companies are concerned about the backlog, with firms like DHL advising customers to shift freight to East Coast ports. Railroads, including Union Pacific and BNSF, are working to manage the influx, but delays continue to impact supply chains. https://lnkd.in/gCUM_cdr

The U.S. Trade Representative (USTR) has once again delayed modifications to Section 301 tariffs, while the House Select Committee has issued questionnaires to U.S. auto part firms. The USTR has opened the Section 301 exclusion process for specific machinery under Harmonized Tariff Schedule Chapters 84 and 85, which are used in domestic manufacturing. The eligible product list is in Annex E of the USTR’s September notice (https://lnkd.in/gW_eT2bw). Companies wishing to request exclusions must provide the following information: - Detailed description of the manufacturing equipment - Ten-digit Harmonized Tariff Schedule classification - How the equipment is used in domestic manufacturing - Availability of comparable equipment from alternative sources - Whether the sector benefits from U.S. federal investment programs - If the equipment is part of Beijing’s "Made in China 2025" or other industrial programs Once an exclusion request is posted, interested parties have 30 days to comment in support or opposition. The requester then has 15 days to submit a reply to any responses. Exclusions granted will be valid through May 31, 2025, and companies utilizing this machinery should consider commenting during the open period from October 15 to March 31, 2025. With Section 301 tariffs reaching up to 25%, successful exclusions can lead to significant savings. https://lnkd.in/gwAFH_wG

177K drivers at risk of losing commercial vehicle driving privileges as November downgrade deadline looms The FMCSA's Clearinghouse-II Rule will take effect on November 18, 2024, mandating that all State Driver Licensing Agencies (SDLAs) revoke commercial driving privileges from individuals classified as "Prohibited" due to drug and alcohol violations. This revocation will remain until the affected individuals complete the Return-to-Duty (RTD) process. As of September 1, 2024, 177,092 CDL and CLP holders were listed as "Prohibited," with 134,779 yet to initiate the RTD process. The new ruling was passed to enhance road safety by ensuring that only qualified drivers retain their commercial licenses, and several states have already started implementing downgrades for non-compliant drivers. For guidance on regaining driving privileges, affected individuals can refer to the FMCSA's resources (https://lnkd.in/gTzmad6Y). https://lnkd.in/gTp8Gc2N