From labor strikes to breaking news, UWL's Logistics Roundup compiles the month's important highlights.
International Trade News
US, Mexico, and Canada Finalize Trade Agreement
The US, Canada, and Mexico have reached an agreement on NAFTA 2.0, now called USMCA - "U.S.-Mexico-Canada Agreement". According to the USTR, "USMCA will give our workers, farmers, ranchers and businesses a high-standard trade agreement that will result in freer markets, fairer trade and robust economic growth in our region. It will strengthen the middle class, and create good, well-paying jobs and new opportunities for the nearly half billion people who call North America home."
What's changed in NAFTA 2.0?
The biggest changes to NAFTA include: Automobiles must have 75% of their components made by Mexico, US, or Canada to qualify for zero tariffs, 40-45% of auto parts must be made by workers who earn at least $16/hr by 2023, US farmers will have more access to the Canadian dairy market, and copyright laws were extended to 70 years beyond the life of the author.
Tariffs and Trade Disputes: Examining the Impact on Global Logistics
Trade disputes and tariffs always have an effect on the global shipping and logistics industry, no matter who is involved. In 2018, however, there have been some big changes that are having potentially huge impacts on the industry. This post we will take a more in-depth look at the tariffs and trade disputes, the impact they have/will have on global logistics, and what led to this moment.
Regulatory & Compliance Updates
Importers: Is Your Continuous Bond Sufficient Enough to Cover Increased Tariffs?
With the constant barrage of updates about Section 301 tariffs, it can be difficult to know what new development will actually affect your business. How can you protect your business from potentially expensive consequences caused by these ongoing trade disputes? A great place to start is your Customs continuous bonds (CBs). Keep reading to learn about how customs bonds are affected by Trump's tariffs, and how you can protect your bottom line.
No waivers allowed for US businesses in latest round of Chinese tariffs
The U.S. Trade Representative is not allowing any exceptions on the latest set of tariffs on $200 billion of imports from China. "Razor-thin margins give retailers very little room to absorb the tariffs without passing some cost on to consumers," the letter from the Retail Industry Leaders Association (RILA) said. "Tariffs must not be an end in and of themselves."
Around the World: Current Events
USA: Hurricane Michael devastates Florida
Hurricane Michael was the first Category 4 hurricane to make landfall in the Florida Panhandle. Michael was the third most intense continental U.S. landfall by pressure and fourth strongest by maximum sustained winds on record.
INDIA: Rising fuel prices cause conflict
The average price of one gallon of diesel in India is currently around $4 compared to an average of $2.9 in the U.S. People in India are really feeling the heat of price inflation, reports FreightWaves.
COSTA RICA: Labor strikes come to a close
CR's government released the following statement: “The labor unions’ strike against the fiscal plan has diluted in the majority of public institutions that joined the movement in the beginning, back on September 10, and currently the protests are limited to workers of the Ministry of Education." Of the 46 public institutions participating in the strike, 45 report working with complete normality.
Shipping & Logistics Industry News
NS Announces Temporary VIG Ingate Closure
An increase in empty and heavy shipments moving from NS origins to the Virginia International Gateway (VIG) has created congestion and impacted capacity. Norfolk Southern Corporation announced, effective 5:00pm October 26, and until further notice, all origin-facility gates will close to empty International shipments and heavy International shipments weighing over 65,000 lbs gross weight billed to VIG. The ingates will remain open to other loaded shipments
Low-sulfur fuel costs will be unclear to shippers until 2019
New low-sulfur fuel is estimated to cost 50% more than the current fuel type, while alternatives, like scrubbers, are costly and take months to implement. To meet the IMO's 0.5% emissions deadline of Jan 1, 2020, industry costs are estimated in the tens of billions of dollars. Container lines have been uniform in saying that these additional expenses will have to be passed onto BCOs, but according to JOC.com, the mandate's true impact on shippers will be hard to predict until 2019.
EGYPT: Berth congestion at ACCHCO Terminal,
No OOG shipments accepted at Alexandria Old Port
ACCHCO Terminal is currently undergoing berth maintenance over the next 9 months and berth congestion is expected. During this period, no OOG shipments will be accepted at Alexandria Old Port, and should be routed to El Dekheila Port instead. Expect substantial delays for any non-OOG shipments to Alexandria Old Port during this time.
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