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Biden and Congress Intervene to Prevent Rail Strike

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Biden and Congress Intervene to Prevent Rail Strike

Potentially Catastrophic Rail Strike Averted by Bipartisan Cooperation

Some might say Christmas has been saved—others feel like all they’ve got is a lump of coal in their stocking. Rumors of a rail strike have been percolating since this summer, before reaching a fever pitch ahead of a December 9th deadline. At the urging and approval of President Joe Biden, congress acted on Wednesday, November 30th to enshrine previous agreement terms.

Regardless of viewpoint or political affiliation, it is undeniable that a rail strike in the final weeks leading up to the holiday season would have been catastrophic for workers and the economy at large. A rail strike of this magnitude could have cost $2 billion per day. Many pro-labor and progressive factions are disappointed that workers will still not receive paid sick leave. However, already fragile freight lines will march on at a precarious time for the U.S. economy.

What Was the Rail Strike About?railroad strike train congress negotiations 2022 brotherhood of railroad

While there were many parts of the contract where railroads and unions did not see eye to eye, the crux of the negotiations was on the point of paid sick leave. Railroad workers did not receive any guaranteed sick leave due to the grueling on-call set up of the current contracts. This meant that it was difficult to schedule doctor’s appointments or even be present at important family and life events. In an era where railroad profits were at an all time high, unions felt unfairly treated by an industry that squeezed wages and was notorious for chronic understaffing.

This has been an ongoing issue for the Biden Administration, including Labor Secretary Marty Walsh, Agriculture Secretary Tom Vilsack, and Transportation Secretary Pete Buttigieg, who have been acting as a middleman between both sides for months. In September, Biden endorsed a plan that included a 24 percent pay increase by 2024. This version of the contract also gave workers an additional paid day off and let them attend medical appointments without penalty. Several unions actually approves this version of the deal. However, the SMART Transportation Division, the Brotherhood of Railroad Signalmen, the Brotherhood of Maintenance of Way Employes Division and the International Brotherhood of Boilermakers voted the contract down. Due to the structure of the contract all twelve railroad unions needed to approve for it to pass.

biden administration congress prevent rail strike union freight forwardingBiden Administration Felt It Was Imperative to Step In

President Biden surprised some supporters and pundits with his decision. “As a proud pro-labor President, I am reluctant to override the ratification procedures and the views of those who voted against the agreement,” Biden shared in a statement. “But in this case — where the economic impact of a shutdown would hurt millions of other working people and families — I believe Congress must use its powers to adopt this deal.”

Even if both sides agreed to meet at the negotiating table, it would have been impossible to ratify an agreement in time for the December 9th deadline. After the midterm elections, Biden was concerned about an even less labor friendly deal being put forward in January. Ultimately, two bills passed the House of Representatives. The first enforces the deal put forward in September and the second would add an additional seven paid sick leave days. The Senate voted on Thursday, December 1st to uphold the original deal, but struck down the additional paid sick leave.

The Biden Administration reasoned that fallout from the intervention from unions and progressive members of Congress would be limited. This has proven to be correct so far. Unions and labor supporters like Senator Bernie Sanders are directing their anger towards “robber baron railroads”, instead of the president.

Significance of Preventing a Rail Strike

Neither the railroads or the unions are particularly happy with the outcome. Even so, both parties got a little of what they wanted and the economy can continue to chug on. Prices, already high from inflation, would have been certain to jump even higher. Certain products like necessary medical and clean drinking water equipment were even able to get through. 

40% of all freight in the United States travels through the railroad system. It is effectively the heart of the domestic supply chain. The entire economy might have come to a complete halt if the government had not stepped in.


How SiShips Gives You the Advantage

Sheltered International combines expertise with state of the art software to bring you quality domestic and international shipping solutions. SiShips puts the shipper in control, offering efficient and cost effective ways to ship your product.

To learn more about managed transportation with SiShips, or to view a demo of our software, contact us today.

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Dispatch from MJBizCon 2022

SiShips was on the Ground for MJBizCon 2022, the Biggest Professional Cannabis Event of the Year

Cannabis is moving fast, and SiShips is helping it move even faster. As domestic and international laws evolve, hemp and cannabis is quickly becoming one of the quickest growing sectors in the agricultural industry. 

SiShips has been working with growers to import supplies like grow lights and processing machines over the last few years. Then, following the Agriculture Improvement Act of 2018 we were able to begin shipping hemp and its derivatives. 

Much of our business at SiShips comes from interacting virtually with our clients, so it’s always a pleasure to meet the people using our services in person. With tens of thousands of attendees and dozens of speakers spread across four days in Las Vegas, MJBizCon 2022 provided the perfect opportunity to expand relationships in the hemp community.

mjbizcon 2022 las vegas hemp cannabis marijuana legalize recreation legalization international thcChanging Hemp Regulations

The legality of cannabis is a major political issue being debated in the United States and the rest of the world. You’ve probably seen discussion of legalizing hemp or maurijuana on the news. As of writing, recreational use of cannabis has been legalized in 21 states and Washington, D.C.; 16 states have legalized medical use of cannabis. Internationally, it is legal to use cannabis recreationally in Canada, Georgia, Malta, Mexico, South Africa, Thailand, and Uruguay.

At the moment, it is legal to ship hemp products that contain no more than .03% THC internationally. Lobbyists hope this limit will be raised in the near future. As more states work to legalize maurijuana domestically, in addition to hemp, it is certain the international regulations will follow.

What Happened at MJBizCon 2022

MJBizCon 2022 sounds like a dream for cannabis enthusiasts—320,000 square feet of exposition space, more than 1,400 exhibitors, and sessions with celebrities like comedian Jim Belushi and football stars Ricky Williams and Calvin Johnson, Jr.—but, it’s more than fun and games. This event is exclusively for cannabis professionals. 

We were able to walk the floor of the Las Vegas Convention Center and get up close and personal industry insiders. Just like Gen Con 2022, MJBizCon 2022 let us connect with current and future clients. Also, we got to see in person some of the advanced equipment we can help our clients ship. Getting a feel for the size and heft of the machines enables us to assist our clients even better. 

All in all, it was a great week to do business in Las Vegas and have a little fun while we were at it.  cannabis mjbizcon 2022 las vegas professional experiences networking greenhouse grow lights equipment

Looking at the Future of Cannabis

Just this month, November 2022, five states voted on amendments to legalize marijuana in all forms. While the amendments only passed in Maryland and Missouri, the future is bright for the cannabis industry. There has been a massive groundswell for legalization over the last decade, since Colorado became the first state for recreational maurijuana in 2012. Legalization has led to big profit returns for vendors who were able to capitalize early.

Next year, lawmakers look to improve the hemp industry with a new 2023 farm bill. The incredible demand for CBD-based products will drive these changes. The United States Department of Agriculture estimated the hemp industry to be worth over $800 million. (And that’s with the current restrictions!) 

SiShips will continue to pay close attention to the hemp industry and other major growth sectors. We make sure we are up to date with the latest shipping regulations so we can provide the best service to our clients, giving them an advantage over their competitors.


How SiShips Gives You the Advantage

Sheltered International combines expertise with state of the art software to bring you quality domestic and international shipping solutions. SiShips puts the shipper in control, offering efficient and cost effective ways to ship your product.

To learn more about managed transportation with SiShips, or to view a demo of our software, contact us today.

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SiShips Launches New Mobile App

Exciting New Way to Manage Freight Forwarding Available on Google Play Store Now

Freight forwarding is officially at your fingertips. Sheltered International is excited to announce that, as of June 27th 2022, our SiShips mobile app is now available on the Google Play store for Android devices. UPDATE (11.01.22) The SiShips mobile tracking and quote tool app is now available on the Apple App Store for iOS devices! Specifically optimized for the iPad, our clients are now able to quote, book and track shipments on all of their mobile devices. At Sheltered International, we are constantly on the lookout for new ways to blend cutting edge technology with personalized shipping expertise. Our new mobile app is just another way that we are putting control back in the hands of you, the shipper.

Mobile App to Combine Information and Efficiency

Our new app is truly the best of both worlds. Sheltered International will maintain our hands-on approach to freight forwarding and combine our personal experience with real-time data tracking—now just a touch away, thanks to the SiShips app. Our team is fully accessible and responsive, but without the clunky delay of a barrage of emails and endless phone calls.

Whether your cargo is traveling through the air, across the ocean, by rail or by truck, you will be able to survey its location with near instantaneous updates. You can now manually check these updates on the app, or turn on Push Notifications for even more convenience.

Current clients will be able to use their login credentials to get started immediately; new clients looking to get started can get in touch with us to begin using our new services as soon as possible.

siships sheltered international mobile app download google apple ios android shipping tracking

Part of Tradition of Embracing Technology at Sheltered International

Our new mobile app is the next step in the evolution of freight forwarding and Sheltered International remains enthusiastic about our role shepherding the industry towards the modern era. Within the last twelve months, Sheltered International has added around the clock rail tracking and managed transportation to our extensive portfolio of freight forwarding services. All of our services, including rail tracking and managed transportation, will be accessible on the app. 

The mobile app will exist alongside our desktop software with continual updates. All new services that Sheltered International will roll out to clients in the future will also be available on the app.


How SiShips Gives You the Advantage

Sheltered International combines expertise with state of the art desktop and mobile software to bring you the highest quality domestic and international shipping solutions. With the world constantly changing, SiShips puts the shipper in control, offering efficient and cost effective ways to ship your product.

To learn more about managed transportation with SiShips, or to view a demo of our software and new mobile app, contact us today.

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Ocean Carrier vs. Drayage Carrier Fees

How Port Congestion and Port Fees Affect You

No one likes port congestion. It causes supply chain delays and missed deadlines, but, worst of all, port congestion can lead to additional ocean carrier and drayage carrier fees.

Ocean carriers refer to the vessel and vessel operators physically transporting goods between international ports. The next step in the supply chain are drayage carriers, which transport goods from ports to their destination. Drayage often refers to trucking and short distances known as “the first mile” on an export or “the last mile” on an import. Unfortunately, both ocean carriers and drayage carriers charge extra fees for delays, wait times, and more.

The federal government is looking to help alleviate the pressure of some of these charges with the passage of the Ocean Shipping Reform Act of 2022 (OSRA 2022). This bipartisan law is designed to help American importers and exporters, especially agricultural exporters, save on costs. The Ocean Shipping Reform Act of 2022 applies to ocean carrier fees, so it is important to understand the distinction between ocean carrier and drayage carrier fees.trucking detention demurrage port congestion

Charges from the Ocean Carrier

There are several key terms to know when discussing charges and fees from an ocean carrier. 

Per diem, also known as detention, is the fee from an ocean carrier for each day past the number of “free” days a container can be away from port. Ocean carriers charge per diem/detention fees as an incentive for customers to return their shipping containers as quickly as possible, so the containers can be used again.

The reverse of detention is demurrage. This refers to the fee assessed by the terminal if your cargo remains at port past the Last Free Day. 

The Last Free Day is the last day of a predetermined period of free storage time in which the goods can be picked up by a drayage carrier before incurring a demurrage fee. Free days depend on your contract and type of drayage carrier (rail, truck, or air), but are typically 2-3 days. 

Charges from the Drayage Carrier

Likewise, here are a few definitions to be aware of when looking over drayage carrier fees.

A pre-pull is when a container is picked up from the port and stored at a different location, instead of being delivered immediately. Pre-pulls are used when free days at the port will run out. They are less expensive than costly demurrage fees.

Wait time is an hourly charge, also known as a trucking wait fee, for each hour it takes to the full container to be updated or unloaded on the truck. Most trucking companies and drivers will allow a small amount of free wait time before charging for additional time. 

As you can see by now, a seamless workflow between ocean carriers and drayage carriers is key to keeping costs down. That’s where a managed transportation expert like SiShips can make a huge difference on your bottom line.  

international port ocean container shipping news osra ocean shipping reform act 2022

Another common set of fees assessed by drayage carriers have to do with the chassis. Chassis are the specialized trailers that are used by trucks to transport ocean containers on the road. Drayage carriers charge a rental fee for these chassis, and an additional fee known as a chassis split, if the truck driver must go to an extra location to pick up a chassis before arriving to pick up the container from the port.

How the Ocean Shipping Reform Act of 2022 Can Help You

Ocean carrier and drayage charges are linked and have a large effect on each other. However, they are separate fees from separate entities and, while logistically they affect each other, the charges are not related.

President Biden signed OSRA 2022 into law on June 16, 2022. This law created new oversight for the Federal Maritime Commission to address unfair charges and unreasonable denial of American exports. In short, OSRA 2022 was made to combat detention and demurrage charges incurred due to port congestion and shipping uncertainty. Additionally, California Gavin Newsom signed AB 2406 into law on September 30, 2022. AB 2406 will go into effect on January 1, 2023. This law will prevent detention and demurrage fees due to circumstances beyond the control of drayage carriers. Reactions to the California law are mixed. Truckers and cargo owners are pleased with the law, but the terminals are concerned about loopholes in the nuance of the law. 

However, it is clear that federal and state level governments are taking upheaval in the shipping industry seriously and are looking for both short and long term solutions.


How SiShips Gives You the Advantage

Sheltered International combines expertise with state of the art software to bring you quality domestic and international shipping solutions. SiShips puts the shipper in control, offering efficient and cost effective ways to ship your product.

To learn more about managed transportation with SiShips, or to view a demo of our software, contact us today.

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Weakening Markets Lead to Trans-Pacific Rate Drops

Trans-Pacific Rate Drops Expected to Last Through End of Year

After generating record-breaking profits during the pandemic, shipping companies are feeling the squeeze of recent inflation. Container carriers are planning on blanking nearly 700,000 TEU in the month of October. Carriers are looking to entice customers back with lower rates. This appears to be one of the best times in recent memory for those looking to transport products internationally, especially between China and the United States.

These trans-Pacific rate drops are not entirely unexpected. The rates that began rising to unimaginable heights during the pandemic stemmed from mostly situational factors. China’s aggressive zero-Covid policy led to shutdowns of their largest ports in Shanghai. This created backlogs which shifted to the ports of Long Beach and Los Angeles, among others. Protests from truckers over vaccine mandates and union regulations led to more delays. However, as the impact of coronavirus has lessened, the economy has been able to work through those issues. Even last month when it appeared a railroad strike could cripple the supply chain again, President Biden stepped in to keep the wheels moving. 

trans-pacific rate drops jacksonville freight forwarding managed transportation railroads air long beach los angeles savannah

Decrease Imports Lead to Trans-Pacific Rate Drops

The biggest factor in the trans-Pacific rate drops is a decreased number of imports. Inflation has led many Americans to tighten their belts and reduce spending on physical goods. Experts forecast growth as little as 7% in the retail sector, and only 1% when adjusted for inflation. This is the smallest year-over-year growth in the last decade and stands in stark contrast to last year’s growth of nearly 15%. 

Retail is not the only area where imports are shrinking. The U.S. Energy Information Association reported that U.S. crude oil imports were down 500,000 barrels per day from the previous week. Exports, however, continued to rise. Russia’s continued aggression in Ukraine, worsening the energy crisis in Europe, has exacerbated global inflation, as well. 

Increased Space in Domestic Ports

A side effect of diminished imports is the backlog of ships in the ports of Los Angeles and Long Beach has been almost completely eradicated. “Container ships have basically returned to normal,” said Kip Louttit, Executive Director of the Marine Exchange of Southern California. “The remainder of the nine in the backup are 50 to 150 miles offshore.” The ability to manage the congestion is a combination of strict management of arriving ships and support from other ports. 

trans-pacific rate drop rates ocean pacific freight shipping The increased capacity of west coast ports has helped to lower rates. Container ship dwell times and truck turn times have both decreased. While blank sailings compared to this time last year have increased, “This does not necessarily indicate a major trend change,” Adam Szabo, a shipping analyst for Sea Intelligence, told JOC.com. “It may just very well be that carriers do not announce or indicate many blank sailings so far ahead.” Either way, the current drop in rates provides an interesting opportunity for international business.

Railroad Rates also Down

Once goods have reached the United States, they are finding even cheaper rates for domestic transportation at the moment. Union Pacific Railroad is reducing their rates from Southern California and J.B. Hunt Transport is forgoing their peak season surcharges. This is not a decision transporters take lightly, as surcharges were as high as $5,000 per container this time last year.

The decrease in railroad rates can be attributed to several factors. First, the weakening consumer market is creating less demand. This works in conjunction with the slowing of imports from China and other countries. Second, the lower rates appear to be a step for railroads to become more competitive with trucking rates. 


How SiShips Gives You the Advantage

Sheltered International combines expertise with state of the art software to bring you quality domestic and international shipping solutions. SiShips puts the shipper in control, offering efficient and cost effective ways to ship your product.

To learn more about managed transportation with SiShips, or to view a demo of our software, contact us today.

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Tentative Deal Prevents Railroad Strike

President Biden Steps In at 11th Hour to Forestall Railroad Strike

Late at night on Wednesday, September 14th, President Biden intervened in deadlock negotiations between railroad companies and their workers. Biden, a long time supporter of America’s rail system, has been keeping a close eye on this contract dispute over the summer. The executive branch originally flexed its power back in July, amid fears that a railroad strike could cost the economy $2 billion per day. Now, following a marathon negotiation session, both sides have made a tentative agreement. The railroad brotherhoods will vote on Thursday, September 22nd, to either accept or reject the terms.

Major disruptions were expected, even leading to Amtrak preemptively canceling service on passenger lines, ahead of the deal announcement. The possibility of a railroad strike has been delayed, and possibly avoided.

railroad strike brotherhood locomotive driver engineers

Photo courtesy of Robert Linder via Unsplash.

What Does the Railroad Deal Include?

After 20 hours of negotiations and a phone call from the president, the current contract includes:

  • Voluntary assigned days off and one additional paid day off 
  • Guaranteed time off for medical appointments
  • No disruption to current health care plans
  • Immediate wage increase of 14% and 24% over the next five years
  • Annual lump sum bonuses of $5,000

Unions had originally asked for 15 paid sick days, but this was rejected.

Demand for Voluntary Days Off

Despite headlines leading up to the potential strike focusing on the pay of railroad workers, the real sticking point was sick leave and voluntary days off. Up until now, railroad workers did not have any sick leave or guaranteed time off. In fact, union members are either working or on call 335 days per year. When on call, workers are expected to report within two hours, if needed.

Union representatives had blasted these working conditions as inhumane. The Brotherhood of Locomotive Engineers and Trainmen (BLET) issued a statement that “these policies are destroying the lives of our members.” Following multiple years of record breaking profits for the transportation and shipping industries, union members felt confident in their negotiation position. They shared anecdotally on Twitter that their “savings will last longer than the rest of the economy if we strike.”

washington white house senate gop democrats railroad negotiations presidential emergency board

Photo courtesy of Ana Lanza via Unsplash.

Railroad Strike at Center of Election Season Showdown

The strongest fear among union members is their livelihood becoming a bargaining chip during an election season. While the vote begins this week, tallying the votes could stretch into October. That means a result could be announced perilously close to Election Day in November.

Twelve separate unions will be voting to ratify the contract; if a single one votes against the contract, negotiations will have to start again. On Wednesday, before Biden’s intervention, GOP Senator Richard Burr of North Carolina and Senator Roger Wicker of Mississippi put forth a joint resolution to force the union to accept the terms from the Presidential Emergency Board created by the Biden administration in July. This measure was blocked by Senate Democrats led by Senator Sanders of Vermont. However, Speaker Nancy Pelosi indicated at the time that if negotiations failed, Democrats would present a resolution to prevent a shutdown. Details of the bill were not announced. 


How SiShips Gives You the Advantage

Sheltered International combines expertise with state of the art software to bring you quality domestic and international shipping solutions. SiShips puts the shipper in control, offering efficient and cost effective ways to ship your product.

To learn more about managed transportation with SiShips, or to view a demo of our software, contact us today.

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Dispatch from Gen Con 2022

SiShips Hit the Floor at Largest Tabletop Game Convention

This past August, the Sheltered International team had the pleasure of attending Gen Con 2022 in Indianapolis. The 54th iteration of Gen Con was four days of gaming excitement, with a focus on pen-and-paper games, board games, card games, and more.

It was a particularly exciting time for us, as Gen Con presented a fantastic opportunity to get up close and personal with fans who order games and collectibles from all across the world. Many of our clients manufacture their products in Asia and attendees of Gen Con are a great representation of the final link in the supply chain.

battletech alpha strike mech con convention center inflatable entrance

History of Gen Con

The first Gen Con was held in 1968 in Lake Geneva, Wisconsin. Thus the name Gen Con, an abbreviation of “Lake Geneva Wargames Convention”. Some fans consider the first convention to have been held one year earlier at the home of Gary Gygax, the creator of Dungeons & Dragons. Either way, what originally began as a gathering of less than a hundred people has grown to become the largest tabletop gaming convention in North America, drawing over 70,000 unique attendees before the pandemic in 2019.

The World War I game Dawn Patrol (originally known as Fight in the Skies) is the only game to have been played at every single Gen Con. The air combat board game has developed a cult following over the years and it has become a tradition for attendees to play the game on the Saturday morning of the convention.

While the focus is on role-playing and strategy games, as Gen Con has grown, so has the scope of its vendors. Following the downsizing of video game convention E3 in 2006, Gen Con has invited video game developers to the Indiana Convention Center floor. 

Gen Con went international in 1990 when it was held in Sussex, England. Since then, cons have been held in Paris, Barcelona, Antwerp and even Queensland, Australia.

Vendors of All Sizes at Gen Con

One of the truly remarkable things about Gen Con is its diversity. Not only in the attendees, but in the vendors with packed merchandise booths and tables full of new and classic games. 

d20 dice rolls dungeons dragons catan d4 dice Vendors of all sizes are represented on the convention floor. Popular board game Catan (over 32 million copies sold), Dungeons & Dragons (the best selling game of all time), and Catalyst Game Labs’ new BattleTech: Alpha Strike (who brought an inflatable mech robot to the entrance of Gen Con 2022) are all at home next to small businesses introducing their homespun games for the first time. 

It’s never certain which game will be the next Catan or Dungeons & Dragons, but to reach the largest audience possible, all creators need reliable transportation management services.

Bringing the Global Supply Chain Home

It is an incredibly rewarding experience to view all of the products and merchandise on display at. To see the excitement on fans’ faces as they pore over pins, prints, and other collectibles makes the behind-the-scenes effort to join together the global supply chain all worth it. 

Fortunately, Sheltered International is on the cutting edge of technology that lets us bring the best shipping solutions to all of our clients, large and small. New satellite and deadline tracking features ensure vendors have their goods in time for conventions and the holiday season. Even better, our new mobile app puts the shipper in control at the tap of a finger. 


How SiShips Gives You the Advantage

Sheltered International combines expertise with state of the art software to bring you the highest quality domestic and international shipping solutions. With the world constantly changing, SiShips puts the shipper in control, offering efficient and cost effective ways to ship your product.

To learn more about managed transportation with SiShips, or to view a demo of our software, contact us today.

1 Continue Reading →

East and Gulf Ports Experience Supply Chain Bottleneck

Record Amounts of Cargo Lead to Delays in the Atlantic and Gulf of Mexico

Backlogs of dozens of ships have reached the East and Gulf Ports. Shippers looking to divert their cargo from the highly publicized congestion in Southern California are finding similar supply chain bottlenecks in the eastern ports of New York, Savannah, and Houston. Manufacturers, carriers, retail and more are still discovering the residual effects of the past two years on the global supply chain.

The peak shipping season, coinciding with the upcoming holiday season is expected to bring challenges. However, experts forecast a slowdown soon after.

port empty containers fees fines backlogRetailers Preparing for Holiday Season

Retailers faced many difficulties over the previous two years. Managing inventory was one of the largest. In an effort to avoid empty shelves that ate into profits, orders for physical goods have been placed earlier than usual and in larger quantities. These dual factors have led to the traditional peak season of shipping to shift slightly forward into the summer months. 

Increased orders have also contributed to the record amount of cargo passing through domestic gateways. The Port of Savannah is seeing its busiest year ever. Savannah’s TEU volume year-to-date is already 7% above last year’s numbers—the previous record holder for busiest year. Savannah is accelerating construction on infrastructure projects and hopes to add nearly 2.5 million TEU of berth capacity by 2024. Unfortunately, this is of little immediate consequence to the 40 ships waiting off the coast of Georgia.

Shipments Diverted to East and Gulf Ports

A major reason for the extra cargo in eastern ports is related to the backlogs in Southern California. Last year, everything from Covid-19 regulations to trucker protests to energy crunches in Europe resulted in hundreds of ships just off the coast at the same time, waiting to enter the Ports of Los Angeles and Long Beach. Not only did this wreak havoc on shipping deadlines, fines were issued for containers that sat at the terminal for too long.

Additionally, freight forwarders have been keeping a close eye on the labor negotiations between the ports and the dockworkers union. President Biden stepped in when they failed to reach an agreement in July and postponed a potential strike until at least September. A federal arbitrator was appointed, but there is still a possibility of a union strike that would shut down west coast ports.teu union shipping dockworkers solutions biden freight forwarding

Hoping to avoid these issues, freight forwarders diverted shipments destined for the United States to East and Gulf Ports. Unfortunately, carriers are still faced with backlogs at the new ports. New York and New Jersey currently have over 200,000 empty containers sitting at their terminals. Apart from taking up space for new arrivals, the tight space also slows down the speed at which ships can be loaded and unloaded. Fines similar to those already in place in Southern California could be enacted elsewhere.

Bottleneck Solutions on the Horizon

The silver lining is the bottlenecks are not resultant of a failure at the ports themselves. There has not been a break in the last two years, which have seen record numbers across the industry. Ports are overwhelmed with cargo and simply do not have enough space. Some locations, such as Savannah, are finding extra land adjacent to or near the port as a temporary stopgap while they improve their infrastructure. Projects to dredge more land and build more cranes are ongoing. 

Lastly, it is possible we have already seen the peak of shipping this calendar year. With the holidays fast approaching, retailers have already placed their orders. Hints of this potential slow down have been seen in Southern California. Ports are extending their hours to prevent a further increase in backlogs and are receiving positive feedback from all involved.


How SiShips Gives You the Advantage

Sheltered International combines expertise with state of the art software to bring you the highest quality domestic and international shipping solutions. With the world constantly changing, SiShips puts the shipper in control, offering efficient and cost effective ways to ship your product. 

To learn more about managed transportation with SiShips, or to view a demo of our software, contact us today.

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New Updates to Merchandise Processing Fees

Why You May Notice Different Fees on Your Invoice

Just in time for the upcoming holiday season, U.S. Customs and Borders Protection is modifying their fee structure on cargo. The new Merchandise Processing Fees, first announced on August 1st, 2022, will enter into effect on October 1st, 2022. Keep in mind that duty-free imports are not exempt from paying these fees.

As part of the Fixing America’s Surface Transportation (FAST) Act of 2015, the Secretary of the Treasury was given the power to adjust Consolidated Omnibus Budget Reconciliation Act (COBRA) fees in accordance with inflation. This decision is made by comparing the average Consumer Price Index from the previous year. If there is an increase of more than one percent, the COBRA fees must be changed, accordingly. These fee increases represent a small percentage of the whole, however, it is important to factor them in while budgeting and preparing calculations for shipments.

ocean cargo shipping freight forwarding u.s. customs inspection fees rates inflation

Notable Fee Changes

The full list of COBRA related fees is available at the Federal Register. For ease of use, we’ve highlighted a few of the fees you are most likely to encounter.

Important to note is the Merchandise Processing Fee rate will not change; it remains at 0.3464% of the cargo value. However, both the minimum and maximum have increased slightly. From the U.S. Customs and Border Protection notice, “The minimum will change from $27.75 to $29.66; and the maximum will change from $538.40 to $575.35.”

  • The Surcharge for Manual Entry/Release (class code 500) will change to $3.56
  • The Dutiable Mail fee (class code 496) will change to $6.52
  • The Commercial Vessel or Commercial Aircraft Passenger Arrival customs fee will change to $6.52 per passenger. Also, the Commercial Vessel Passenger Arrival (from exempt areas) customs fee will change to $2.29 per passenger.
  • The Commercial Truck Arrival fee will change to $6.50. The total single crossing fee will be $14.05, as the Commercial Truck Arrival Fee does not include inspection service fees (which are currently $7.55).

 

international freight forwarding fee structure increase shipping news

Are Any Imports Exempt from Merchandise Processing Fees?

While we mentioned that just because an import is duty-free that does not mean it is exempt from Merchandise Processing Fees (MPF), there are certain Free Trade Agreements that will waive the MPF. For example, the current Free Trade Agreement with Israel provides an exemption. Sheltered International will be able to help you work through and understand whether MPF will apply to your shipment.


How SiShips Gives You the Advantage

Sheltered International combines expertise with state of the art software to bring you the highest quality domestic and international shipping solutions. With the world constantly changing, SiShips puts the shipper in control, offering efficient and cost effective ways to ship your product.

To learn more about Merchandise Processing Fees and possible exemptions, or to view a demo of our software, contact us today.

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Biden Uses Executive Power to Delay US Rail Strike

Possible US Rail Strike Averted by Creation of Presidential Emergency Board

Last week, President Biden created a Presidential Emergency Board via Executive Order to mediate ongoing labor disputes between railroads and railroad unions and prevent a US rail strike. This had been long expected to arrive before the drop date of July 18th, when a national strike would have taken effect. 

“I have been notified by the National Mediation Board that in its judgment these disputes threaten substantially to interrupt interstate commerce to a degree that would deprive a section of the country of essential transportation service,” wrote President Biden. Combined with shipping delays from Russia’s war in Ukraine, rising inflation, and international backlogs, a US rail strike would have pushed the domestic supply chain to the brink.

shipping yard depot train railroad union workers Reasons for Union Frustrations

The Brotherhood of Locomotive Engineers and Trainmen (BLET) are just one of the 13 unions involved in the national labor contract negotiations. The members of BLET voted 99.5% in favor of the strike. The reasons cited by the union range from lack of pay increases over the past three years to shrinking healthcare benefits and a blame on “bad faith negotiations” by the railroads themselves. 

Despite the supply chain issues, railroads have maintained its status as the most profitable industry in the United States. Workers blast the “corporate greed” of railways. “They just simply don’t want to share their record profits with their employees,” says Dennis R. Pierce, the national president of BLET. Unions are frustrated that a large portion of their workforce was furloughed due to the pandemic and have not been reinstated despite the fully restored cargo volume.

Additionally, workers are concerned about the concept of Precision Schedule Railroading (PSR). While railroads explain that PSR allows them to operate more efficiently, workers say that it is costing them jobs. This is not dissimilar to contract negotiations dealing with automation in west coast ports. 

Potential Impact of US Rail Strike

In short, a true strike would be absolutely catastrophic for the United States. Fortunately, the Railway Labor Act (RLA) has certain stopgaps in place to prevent such an event. Neither side of the negotiation table is keen on a strike occurring. President Biden was lauded by the Transportation Trades Department (TTD), another union involved in negotiations, following his creation of the Presidential Emergency Board. shipping logistics railroad railways union strike biden corporate greed

Most importantly, the RLA includes “cooling off” periods following strike votes that enable negotiations to continue before action is taken. A cooling off period occurred after the unions voted overwhelmingly to strike, which gave President Biden the opportunity to create the emergency board. The emergency board has 30 days to draft recommendations for both sides. This will be followed by an additional 30-day cooling off period. Now, the earliest potential for a strike is mid-September. 

While this has certainly given everyone some breathing room, if a strike were to occur it would now take place in the run up to midterm elections and the holiday season.

US Rail Strike Effect on Washington

This is not the first time in recent years that the president has had to intervene. President Obama was forced to act in 2011. During that time, the BLET was the first to authorize a walk out, if necessary.

While there is precedent, this new emergency board comes at a precipitous time politically for President Biden. Famously a booster for rail travel, flexing his executives powers has the potential to backfire ahead of the midterm elections. Alternatively, if the strike cannot be avoided, the political ramifications for President Biden and democrats in general would be calamitous.

Despite the frustrations of many rail workers, there is hope that a unified front by all 13 unions with the assistance of the president will lead to a satisfactory outcome for all parties. 


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