West Coast Issues & G6 Service Change

CONGESTION SURCHARGE COMES BACK INTO PLAY:
After announcing a surcharge and then suspending it, carriers are again announcing a congestion surcharge for cargo going into West Coast ports with an effective date based on gate-in at origin of November 26, 2014. The surcharge is again being questioned and examined by the FMC as they review the trigger mechanism and the undefined longevity. We are working with other trade groups to pressure the carriers to suspend the surcharge and will keep you all advised as the scenario is changing on a day to day basis.

ILWU/PMA CONTRACT TALKS ON HOLD:
In other news, the ILWU has announced that negotiations will be suspended through the end of Thanksgiving weekend despite resistance from the PMA and general retailers, manufacturers, farmers and consumers. The break in negotiations comes at a critical time in the U.S. economy, with the holidays coming just around the corner. Members of Congress have been made aware of the damaging effects of the work slow down, but at this point, Congress is staying away from any direct involvement in the process.

G6 ANNOUNCES SERVICE CHANGE:
The G6 Alliance (APL, Hapag-Lloyd, Hyundai Merchant Marine, Mitsui, NYK and OOCL) has announced that it will drop the European calls on the Pacific Atlantic 2 (PA2) service between the U.S. East Coast and Europe. The official announcement indicates that this is due to “seasonal changes in market demand”, but unofficial reports indicate that the cancellation is to mitigate deep losses and act as a cost savings measure. As the transatlantic to U.S. East Coast vessels continue to sail at full capacity, we will monitor the effects of this change and resulting constriction in space. Fortunately, we have a few weeks before the final sailing from Europe, planned for December 28 from Rotterdam.

We will continue to monitor these developments and will keep you updated accordingly.