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TPEB TRADE OUTLOOK JULY-30-2021

Dear customers,

 

We continue to see a very strong Trans-Pacific eastbound market situation since the first quarter of 2021 to now. Space and equipment continue to be scarce. We’ve summarized some of the current TPEB market updates as below for you.

 

  • US port congestion is still a problem, especially in LA/LB.

 

Because of the strong consumer demand in the states since the COVID-19 situation is getting better and consumer product needs are strong. The import volume dramatically goes up during this peak season for all the importers to have their goods ready for the strong sales. However, the US ports just can’t digest this volume which causes serious congestion, especially Los Angeles and Long Beach port, which covers over 50% of the total TPEB volume. As you might also knew, BNSF also stopped their service to Chicago for weeks in order to digest the backlog at terminals.

 

  • Vessel schedules are affected/delayed or even blanking sailings in late July and August.

 

Owing to this port congestion, all the vessels are lined up and waiting outside of the ports for berth, which seriously affected the schedule. We are seeing the schedule has been unstable, delayed or even cancelled since the ship can’t make it back to Asia in time.

It also makes the equipment shortage in Asia, as the empties on the TP westbound voyage are not able to arrive in time to fulfill the strong demand for TPEB volume.

 

  • Ocean freight keeps increasing and Port Congestion Charge are implemented.

 

Overall, strong demand and supply shortage urges the ocean freight keep increasing and we expect this momentum will continue through September or even after October as the holiday season goods are coming to the market now.

 

We are pursuing all options to minimize the impact to your supply chain.  In order to assist you with your imports, it is crucial you confirm the bookings immediately when sent, so we can work on locking space/equipment as needed for you.   Should you have any question, please contact your CSR or operations PIC.

 

Thank you for your continue support and we are doing all we can do to keep your cargo moving as always.

Port Congestions in North America July-30-2021

Dear Customers,

We are seeing serious port congestions in north America ports, especially for LA/LB, which also affects the vessel schedules unstable recently. Carriers are also filing port congestion surcharges onto the shipment due to these circumstances.

Listed below is the most updated list by Steamship Line of the upcoming Port Congestion Surcharge (as of July 28, 2021).  The Port Congestion Surcharge is based on the discharge date of your shipments.  With all the delays and roll overs, it’s possible that the Port Congestion Surcharge would apply to your current bookings if the shipment arrives at the destination port on/after the effective date. We are following up closely with all carriers and will keep you posted on any updates. Please contact your CSR or operations person, should you have any further questions or concerns.

Carrier Items Quantum Effective Date Corridors Applicable to Remark
ZIM Port Congestion Surcharge (CNS) USD1000/Box 2021/8/1 All export cargo from Asia to Los All kinds of cargo and all equipment types These charges will be collected in US based on Asia gate in date.
USD5000/Box 2021/8/6 Angeles and Tacoma applicable to ZEX, ZX2 and ZX3 lines
USD1000/Box 2021/8/1 Other US  & Canada Port
Destination Delivery Charge (DDC) USD1000/Box 2021/8/1 Los Angeles and Tacoma
WHL Port Congestion Surcharge (PCS) USD100/20’
USD200/40’&40’HQ
2021/7/26 All (except US to HK & HK to US : base on 8/15 POL gate-in date) All kinds of cargo and all equipment types Payable at Hong Kong.
2021/8/15 HK to US
MSC Congestion Surcharge(CGS) USD 800/20′,
USD 1000/40DV,
USD 1125/40HC,
USD 1266/45’
2021/9/1 All China/SEA/S Kore/Japan exports to cargo to and via any US and Canada ports All kinds of cargo and all equipment types The effective date against Discharge Date in POD.
MATSON California Port Congestion Surcharge(PCS) USD 2000/20′
USD 2500/40DV
USD 2813/40HC
USD 3165/45’
USD 2000/R20′
USD 2500/R40′
2021/7/15-2021/8/4 Region for Long Beach,CA & Oakland,CA (Excluding Hawaii, Guam, Micronesia, Republic of Palau, Marshall Islands, CNMI) All kinds of cargo and all equipment types PCS will be collect only charges in the US.
USD 3600/20′
USD 4500/40DV
USD 5063/40HC
USD 5697/45’
USD 3600/R20′
USD 4500/R40′
2021/8/5
HPL On-carriage Congestion Surcharge (OCS) USD350/Ctnr. 2021/8/1 1. All import moves in the U.S. where HL is responsible for the truck and/or rail move;                             All kinds of cargo and all equipment types For all intermodal moves
2. All export moves in the U.S. where HL is responsible for the truck move;                                             Effective upon carrier receipt of cargo on or after August 1, 2021 and is valid until further notice
Pre-carriage Congestion Surcharge (PCS) 3. For Los Angeles (LAX)/ Long Beach (LGB), please note that the existing charge will remain as it is today with the amount increased to USD $350 per container.
Value Added Surcharge (VAD) USD 4000 for all 20′ container types 2021/8/15 Ex China to North America (USA and Canada) All kinds of cargo and all equipment types Need to be paid under collect basis at US and Canada destinations./ VAD count under gate-in date.
USD 5000 for all 40′ container types
CMA Port Congestion Surcharge(PCS) USD 800/20′
USD 1000/40′
USD 1100/40HC
USD 1266/45’
USD 1000/40’NOR
2021/8/7 All Asia (including Far East) Ports of Loading All kinds of cargo and all equipment types EXX svc only.
To: Los Angeles only PCS will not apply to shipment rates to/via Hawaii port of discharge.
The charges will be collected at the U.S. port
Port Congestion Surcharge(PCS) USD 2000/20′
USD 2500/40′
USD 2815/40HC
USD 3165/45’
2021/8/15 South East Asia, Nouth East Asia, Russia Far East, North China, Central China, Hong Kong & South China Ports of Loading All kinds of cargo and all equipment types Including EXX svc(Will charge both USD800/1000/1100/1266/1000 per 20’/40’/40’HC/45’/40’NOR & USD2000/2500/2815/3165 per 20’/40’/40’HC/45′ if under EXX svc).
To: U.S West Coast, U.S Eest Coast, U.S Golf Coast & Dutch Harbor Ports of Discharge. Based upon container arriving date at US.
The charges will be collected at the U.S. port

USPTI-Taiwan Announcement

Please be advised USPTI has officially received our Taiwan business license effective May 6,2021.
USPTI will officially open our USPTI Taiwan office on May 14.2021.

Our office address is:
USPTI Taiwan , Inc.
10F, NO, 289 SEC 4, Zhongxiao E. Rd.
Da An Dist. Taipei City 106450, Taiwan
T : ‪886-2-27789770
F : ‪886-2-27789780

Effective May 6 please contact USPTI Taiwan for all booking, space and customer service needs.
Our new office will serve as our I.T. Hub utilizing the CargoWise Network in Asia. Having this
new office will give USPTI opportunity to continue our growth in the NVOCC market with our carrier partners. I would like to personally invite you to attend this Grand opening as it will be of great value for you as we work to achieve our operating and strategic objectives of our businesses together.

Thank you for your business and we look forward to a continuing relationship of service. We are confident our new Taiwan office will assist in ensuring your international requirements are meet.

TPEB TRADE UPDATED 4-9-21

Dear Client,

 

We are facing a critical time in our industry that has not been experienced for years and it is making it very challenging in regards to the effect on all supply chains.

 

See the below information:

 

  • Equipment shortages in China are being experienced.  Carriers are doing all possible to replenish origins however the imbalance in trade is making this increasingly difficult and it is also very costly to send empties back to Asia.

 

  • Space is extremely short at this time from all China base ports.  The arbitrary origins ports are even worse due to the smaller feeder vessels so trucking from the feeder port to the mainline POL is required in many cases.

 

  • Rates are at an all-time high and continue to increase with premium rates being required in exchange for space.  Even with premium rates there is no guarantee of obtaining space on the requested vessels. 

 

  • The space situation is most critical at this writing to the USEC however the USWC is also problematic.

 

  • For cargo that is needed to the USEC and/or inland locations you may wish to consider discharge on the USWC and then  transloading into domestic trucks to move inland,  as needed,  to keep the cargo flowing.

 

  • We do not expect that this situation will improve in the short term and could last thru August based on all indications at this time.

 

In order to assist you with your imports it is critical that you confirm the bookings immediately when sent so we can work on gaining space as needed.  The space situation changes from day to day due to the overall volume of orders being requested so important to advise ASAP to assist us to gain the space on your behalf.

 

Thanks for your continue support and rest assured we are doing all possible to keep your cargo moving.

 

Sincerely,

Market Update Feb 24,2021

Dear Valued Client,

 

We continue to see a very strong market thru the first quarter of 2021 and beyond.  Space, and equipment continue to be scarce due to strong demand up to and immediately after Chinese New Year.

 

It appeared  that there will not be a slow season and the strong consumer demand will continue into the second quarter 2021.  We request that book early and provide forecasts and projections that will assist us to obtain the space and equipment required to service your import requirements.

 

Vessel schedules and service integrity, with all carriers, continues to be a challenge. Terminal and berthing availability continues to be problematic at both origin and destination ports.  Weather has also had some effect on vessels crossing the Pacific Ocean and is currently impacting intermodal rail operations.

 

Freight costs will remain high in view of the space concerns, critical shortages of equipment and overall consumer demand.

 

Please contact your USPTI representative for detailed information or any specific questions

 

Thank you for your support and we look forward to a long term relationship of service.

Trans Pacific Market Update Dec 11, 2020

Dear Valued Client

 

The extremely strong  trading condition, with container volume exceeding available supply, is forecasted to remain strong through Chinese New Year.

 

Equipment shortage throughout Asia will continue to impact the ability to secure equipment necessary for booking.

 

Likewise we note many carriers are now focusing on “mother ports” and eliminating service from smaller/non-direct call ports. You may have to consider utilizing direct call ports to protect the integrity of your supply chain.

 

It is anticipated that ocean freight cost will continue to increase prior to and immediately after Chinese New Year. With the ongoing capacity issues numerous carriers are not in a position to accept any new business.

 

Thank you for your support.

 

Please contact your USPTI representative with any concerns

ONE Line Apus Update Incident Update and Market Impact Dec 9, 2020

Dear Valued USPTI Customers

 

 

ONE Line Apus Update Incident Update and Market Impact

 

ONE Apus is now confirmed to be safely berthed in the Port of Kobe after losing 1,816 containers overboard when it encountered severe weather on Monday, November 30, 2020.

 

A full safety inspection of the vessel and its remaining cargo will now take place with the assistance of local emergency services to ensure that there is no threat to people or the environment posed by the dislodged and damaged containers that remain on deck.

 

Once the vessel and cargo are declared safe, surveyors from the various stakeholders will make their initial assessments whilst stowage planners and stevedores formulate and implement a plan to ensure the safe removal of the remaining units. Then, a thorough evaluation will be made on the exact number and type of containers that have been lost or damaged and damage to the vessel.

 

USPTI anticipates the unloading of containers and vessel assessment to take several weeks. We are still awaiting an actual list of potential USPTI cargo damaged or impacted and will keep you updated on the progress as provide you with additional information as it becomes available.

 

USPTI is still evaluating the  impact to an already space constrained market and anticipates the incident will reduce overall available space for the foreseeable future as demand continues to outpace available container supply. Likewise we anticipate the incident will further erode equipment availability.

 

We will provide additional updated as more info become available.

 

Thank you for your support and we look forward to a long term relationship of service.

 

Should you have any questions or concerns please contact your USPTI representative.

USPTI Market Update Aug 21, 2019

Trans-pacific Import trading conditions are being impacted by uncertainty in duties and in general a concern over general economic conditions.

Although volume is not anticipated to peak as substantially as in the past, carriers are voiding sailing which impacts supply and demand on a weekly base. Although void sailing could be considered an artificial mechanism to impact short term capacity one should note that the new emission standards for ships will be implemented Jan 1,2020. The need to retrofit vessels to meet these standard will dictate that vessels be taken out of service for the needed maintenance. Each carrier will establish individual plans to deal with the new regulations.

Albeit trading conditions are not as strong as we would like due to above noted reason space maybe an issue from/to certain location on certain weeks, thus please allow as much lead time as possible for booking to insure we can secure the services that meets or exceeds  your individual requirements

Since the concern over duties seems to be driving many purchasing decisions please note the below update on import tariffs.

According to the official notice from The US Trade Representative (USTR), they posed an explanation of the effective date below;

 

DATES: Additional duties at a rate of 10 percent ad valorem on the tariff subheadings set out in Annex A to this notice are applicable with respect to products that are entered for consumption, or withdrawn from warehouse for consumption, on or after September 1, 2019. Additional duties at a rate of 10 percent ad valorem on the tariff subheadings set out in Annex C to this notice are applicable with respect to products that are entered for consumption, or withdrawn from warehouse for consumption, on or after December 15, 2019.  

https://ustr.gov/sites/default/files/enforcement/301Investigations/Notice_of_Modification_%28List_4A_and_List_4B%29.pdf

The date should be the fully released date when the imported goods must be actually arrived at the port AND customs are also released without further hold. So the goods are legitimately entered into the US Territories for consumption.

 

Example 1.

If goods actually arrived on 08/31/2019, customs entry filed on 08/27/2019 and customs released on 08/29/2019. No additional 10% duty in this case.

 

Example 2.

If goods actually arrived on 08/31/2019, customs filed on 08/27/2019 but customs put on hold for review or exam until 09/04/2019. It still have an additional 10% duty.

 

Making Customs entry before 9/1/2019 will not avoid the chance of getting the additional 10% duty.

Please review the below links for specific information.

https://ustr.gov/sites/default/files/enforcement/301Investigations/List_4A_%28Effective_September_1%2C_2019%29.pdf

 

https://ustr.gov/sites/default/files/enforcement/301Investigations/List_4B_%28Effective_December_15%2C_2019%29.pdf

Requirements for First Sale Valuation

The First Sale rule could offer significant tariff savings for US importers.

However, few companies have adopted this rule in practice, as the legal requirements, documentation headaches, and practical problems involved can be daunting at the beginning.

Firstly, the multi-tier transaction generally must meet the following requirements by CBP:

  • Bona Fide Sale: The transaction – which is the first sale – between the manufacturer and the intermediary must be a bona fide sale, complete with a transfer of title.
  • Arm’s Length: The Chinese manufacturer and the intermediary must be unrelated or, if related, conduct their transactions at “arm’s length”.
  • Clearly Destined for Export: At the time of the “first sale”, the merchandise must be clearly destined for export to the US. For example, the goods are shipped directly from the supplier to the US, or the goods are specially designed or labeled according to the standards of the US market or according to the requirements by the US importer.

Secondly, to prove that the initial “first sale” price is accurate, the manufacturer, the intermediary, and the US buyer have to be prepared to submit the following documents:

  • Purchase orders with copies of terms between all parties;
  • Confirmations;
  • Invoices;
  • Written contracts or sales agreements;
  • Bills of lading for final products and materials;
  • Proof of payment (e.g. letters of credit);
  • Production orders and/or manufacturing instructions and other unique specifications of the merchandise to conform to the buyer’s standards;
  • Examples of labels, logos, stock numbers, bar codes, and other unique merchandise or carton marks; and
  • Examples of country of origin marking on finished goods, hang tags, etc.

Why don’t more companies take advantage of the First Sale rule?

There are various reasons why more companies haven’t employed the First Sale rule, but the main reason is that businesses need to expend a considerable amount of time and resources to ensure a given transaction meets compliance and internal control requirements.

Since the information as mentioned above is often kept by different partners in the supply chain, cooperative relationships and responsibilities need to be developed between the manufacturer, the intermediary, and the importer.

Importers need to persuade other partners to disclose the “first sale” price and ensure only the right people see the sensitive documentation and data, which requires tight control over the process.

In addition, there are risks of errors and non-compliance, and failure to comply with the requirements of the First Sale rule could be construed as a lack of reasonable care and may result in a fine.

What are the experts saying?

A growing number of foreign firms are studying the applicability of the First Sale rule, as they look to offset rising costs stemming from the trade war.

Our CHB  explained, “In the case of a Chinese good sold through a wholesaler in Hong Kong to a US buyer, the good would still be subject to US import tariffs set for China but the value of the Chinese good, on which taxes are calculated, would be lower.”

While this strategy has clear benefits, experts caution that not all businesses qualify to use it.  Our CHB warned, “The First Sale rule is subject to a strict assessment by US Customs, so it is not possible for all firms to use this strategy.”

“Firms that are seriously considering using the First Sale rule should closely study whether they are eligible,” Our CHB said, “or else they risk being overturned by US Customs at a time they are likely paying closer attention to the rule.”

Besides legal eligibility, Our CHB also said that the rule is not suited to all types of businesses. “The ability of companies to leverage the First Sale rule in the context of the US-China trade war will depend on the presence and markup of wholesalers between a Chinese manufacturer and US buyer.”

 

Our CHB continued, “If wholesalers are not present in the supply chain or the First Sale rule is already being applied, there will be little benefit in exploring this option as a trade war mitigation instrument.”

Although it is not a universal solution for all companies hit by the trade war, it can still be an effective tool for those whose business model and legal status fit. “If wholesalers are present and the First Sale rule is not being applied, larger wholesaler markups will provide greater room for maneuverability,” .

With businesses on both sides of the Pacific feeling the impact of eight months of US-China tariffs, affected businesses are eager to explore any solution to minimize their costs.

In this regard, the First Sale rule could be an effective option for businesses to lower costs without sacrificing operational inputs or significantly altering pre-existing supply chains.