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California calls on FMC to take immediate action on export delays

THE state of California is urging the Federal Maritime Commission (FMC)to take immediate action on port congestion to help agriculture exporters mitigate rising costs and delays amid peak season for some farmers

03 February 2021 - 19:00
THE state of California is urging the Federal Maritime Commission (FMC)to take immediate action on port congestion to help agriculture exporters mitigate rising costs and delays amid peak season for some farmers.

In a letter to US regulators, Lieutenant Governor Eleni Kounalakis, outlined possible steps, including the suspension or reduction of detention and demurrage charges and the cancellation of congestion surcharges.



Other remedies floated by Ms Kounalakis include better communication to exporters and truckers when they can return empty containers and rulemaking related to detention and demurrage practices.



'Immediate steps must be taken to help alleviate the multitude of challenges being experienced at the ports,' she wrote to the five commissioners. 'The current port situation falls within a crucial time frame for California's agriculture sector as it is occurring during a peak shipping period for several commodities.' The export of such commodities account for about US$3.8 billion, or 17 per cent, of California's annual exports.



The FMC is investigating ocean carriers' operational issues and practices that the commission believes are contributing to congestion at the ports of Los Angeles, Long Beach, and New York and New Jersey.



The FMC's November launch of the probe came after a coalition of truckers, shippers, and customs brokers urged an immediate suspension of detention and demurrage charges at the ports of LA, Long Beach, and NY-NJ until congestion at the country's two largest gateways dissipates.



Ocean carriers said they are working closely with truckers and shippers to address congestion issues that are crippling the ports of Los Angeles and Long Beach, but carriers have resisted calls for the suspension of detention and demurrage charges.



Carriers argue the fees encourage shippers and truckers to pick up containers and return equipment, key to helping cargo flow at the marine terminal, and that the disruption is out of their control, reports IHS Media.


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