Moving Grain: Shippers Ask FMC To Publish Container Availability Rule

Grain crates ready for shipment.

Shippers Ask FMC To Publish Container Availability Rule

On March 16, a group of 67 trade associations sent a letter asking the Federal Maritime Commission (FMC) chairman to finalize and publish its Proposed Interpretive Rule on Demurrage and Detention. The proposed rule provides guidance on fair and reasonable practices for ocean carriers and marine terminals to assess demurrage and detention fees on shippers.

Shippers maintain that detention and demurrage should not be assessed for a failure (outside the shipper’s control) to return or pick up containers during the free allowance period. In their letter, the shippers assert that current practices on demurrage and detention fees threaten the competitive edge of U.S. exports globally while making imports more expensive to consumers and manufacturers.

Through the proposed rulemaking, FMC aims to clearly define demurrage, detention, and dispute resolution policies and to clarify how ocean carriers and marine terminals should alert shippers when their cargo is available for retrieval.

Agricultural Trade Organizations Call for Increased Truck Weight Limits and Harmonization

On March 30, 62 food and agricultural organizations sent a letter to governors and other State officials requesting States increase truck weight limits to a minimum of 88,000 pounds on U.S. Highways and Federal Interstate Highways for the rest of fiscal year 2020.

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The request aims to optimize capacity of the U.S. food supply chain if fewer truck drivers are available because of coronavirus disease (COVID-19). Section 22003 of the recently enacted stimulus bill clarifies the U.S. Department of Transportation’s authority to allow States to increase truck weight limits on U.S. interstate highways during the COVID-19 emergency.

The States already have the authority to raise truck weight limits on their State roads. The request also seeks to ensure minimum weights are “harmonized” across all States—i.e., all States adopt the same minimum—so drivers will have no impediments when crossing State lines.

FMCSA Expands HOS Waiver To Include Feed and Fertilizer

On March 25, the U.S. Department of Transportation’s Federal Motor Carrier Safety Administration (FMCSA) updated the frequently asked questions for its COVID-19 emergency declaration to clarify that feed and fertilizer are covered. This means drivers transporting feed and fertilizer are currently exempt from federally mandated hours-of-service (HOS) rules.

In response to supply chain disruptions, a group of 53 farm- and food-related associations, including the National Grain and Feed Association, urged FMCSA to include animal food and feed ingredients in its emergency declaration.

Earlier in March, after President Trump declared a nationwide emergency, FMCSA temporarily granted exemption from HOS rules to drivers transporting food or livestock to distribution and retail facilities.

Snapshots by Sector

Export Sales

For the week ending March 19, unshipped balances of wheat, corn, and soybeans totaled 23.6 million metric tons (mmt). This represented a 27-percent decrease in outstanding sales, compared to the same time last year.

Net corn export sales reached 1.814 mmt, up significantly from the past week. Net soybean export sales were 0.904 mmt, up 43 percent from the previous week. Net weekly wheat export sales reached 0.740 mmt, up significantly from the previous week.

Rail

U.S. Class I railroads originated 20,996 grain carloads during the week ending March 21. This was a 5-percent increase from the previous week, 5 percent less than last year, and 8 percent lower than the 3-year average.

Average April shuttle secondary railcar bids/offers (per car) were $25 above tariff for the week ending March 26. This was $50 less than last week and $316 lower than this week last year. There were no non-shuttle bids/offers this week.

Barge

For the week ending March 28, barge grain movements totaled 514,104. This was a 16-percent increase from the previous week and 23 percent less than the same period last year.

For the week ending March 28, 310 grain barges moved down river—37 more barges than the previous week. There were 588 grain barges unloaded in New Orleans, 5 percent higher the previous week.

Ocean

For the week ending March 26, 32 oceangoing grain vessels were loaded in the Gulf—14 percent fewer than the same period last year. Within the next 10 days (starting March 27), 39 vessels were expected to be loaded—7 percent fewer than the same period last year.

As of March 26, the rate for shipping a metric ton (mt) of grain from the U.S. Gulf to Japan was $39.00. This was 5 percent less than the previous week. The rate from the Pacific Northwest to Japan was $20.00 per mt, 6 percent less than the previous week.

Fuel

For the week ending March 30, the U.S. average diesel fuel price decreased 7.3 cents from the previous week to $2.586 per gallon, 49.2 cents below the same week last year.

Full report.




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