An ambitious plan to further reduce greenhouse gas emissions at two of the busiest ports in the United States could add billions of dollars in supply chain costs and make the ports less attractive to shippers and cargo owners, according to the National Industrial Transportation League.

In a letter to the environmental directors of the Port of Long Beach and the Port of Los Angeles, the League joined with roughly 70 other associations in expressing concern that a Clean Air Action Plan drafted by the ports, while “laudable and well intentioned,” will reduce the competitiveness of the ports and further erode their share of freight commerce.

“While the ports and stakeholders must continue to build upon the successes achieved so far, we
are significantly concerned with several aspects of the Draft Clean Air Action Plan Update,” the letter states. “These include the lack of information with respect to the commercial availability of specified technologies, the uncertainty of the draft plan’s cost, the absence of any analysis regarding the ports’ future competitiveness, the exclusion of certain technologies and fuels, and the lack of a cost benefit analysis on the air quality benefits that would result from this program. Ironically, these are issues which are identified within the report, but for the most part deemed unimportant.”

The action plan, announced by port officials on July 19, proposes short- and long-term strategies to further reduce air pollution from port-related sources and ultimately achieve zero emissions for trucks and terminal equipment. Although they have made great strides in reducing pollution in recent years, the ports are the largest source of smog-forming pollution in Southern California.

The Federal Maritime Commission has agreed to hold public hearings on a petition signed by NITL and several other groups that seeks to clarify when and why ocean freight lines and terminal operators can assess demurrage, detention, and per diem charges when ports are congested or otherwise inaccessible.

In December 2016, the League and 25 other trade associations—known collectively as the Coalition for Fair Port Practices—filed a petition with the FMC asking the agency to initiate a rulemaking proceeding “to clarify what constitutes `just and reasonable rules and practices’ with respect to the assessment of demurrage, detention, and per diem charges by ocean common carriers and marine terminal operators when ports are congested or otherwise inaccessible.”

Today, the FMC met in open session to receive updates on supply chain innovation teams, London International Shipping Week, and the agreement review process. The commission then went into closed session for a briefing about the many comments submitted in response to the coalition’s petition. The commission agreed that, given the wide range of port business practices disclosed by the comments, a public hearing was indicated.

“We are delighted to see the FMC’s consideration of the petition brought forth by the Coalition for Fair Port Practices, and are especially pleased to see that the agency will hold hearings to hear directly from affected stakeholders,” said NITL Executive Director Jennifer Hedrick. “NITL is joined in the coalition by over 20 associations, collectively representing hundreds of shippers and transportation providers who seek fair detention and demurrage practices at our nation’s ports. We look forward to working with the FMC and others to pursue workable resolutions to issues that have created penalties for beneficial cargo owners due to delays and disruptions outside of their control.”

Trade and shipper associations, individual importers and exporters, customs brokers, freight forwarders, logistics companies, trucking and drayage companies, ocean carriers, port authorities, marine terminal operators, and other stakeholders will be invited to testify at the hearings. Hearing details will be published as soon as arrangements are finalized.

A key Senate committee is asking the Federal Maritime Commission to give high priority to an NITL-backed effort to clarify when and why ocean freight lines and terminal operators can assess demurrage, detention, and per diem charges when ports are congested or otherwise inaccessible.

In December 2016, the League and 25 other trade associations—known collectively as the Coalition for Fair Port Practices—filed a petition with the FMC asking the agency to initiate a rulemaking proceeding “to clarify what constitutes `just and reasonable rules and practices’ with respect to the assessment of demurrage, detention, and per diem charges by ocean common carriers and marine terminal operators when ports are congested or otherwise inaccessible.”

Yesterday, John Thune, chairman of the Senate Commerce, Science, and Transportation Committee, sent a letter to acting FMC Chairman Michael Khouri urging the commission to “prioritize” this issue and take actions as warranted.

“Agricultural producers, manufacturers, retailers, and transportation service providers have questioned the fairness of detention and demurrage charges in situations involving port congestion and other circumstances,” Thune wrote. “They assert that such charges have implications for one of the Commission’s critical responsibilities—to ensure a common carrier or marine terminal operator does not fail to establish, observe, and enforce just and reasonable regulations and practices when receiving, handling, storing, or delivering property.”

On August 31, NITL filed comments with the U.S. Surface Transportation Board urging the STB to resume its “normal process” for completing rulemaking proceedings. The comments were submitted in response to a petition filed by the Western Coal Traffic League asking the STB to terminate its regulatory freeze and move forward on four pending proceedings.

NITL Executive Director Jennifer Hedrick participated in a “listening session” with the Surface Transportation Board’s Regulatory Reform Task Force on July 25. The purpose of the session was to hear stakeholders’ views on streamlining STB regulations. Hedrick presented recommendations to the task force on how to eliminate outdated or burdensome regulations. A number of shipper organizations were present, as were several railroads.

Members of the National Industrial Transportation League (NITL) elected Mary Pileggi their new chairman on January 31 during the association’s annual business meeting.

Pileggi is sourcing and logistics manager for the fluoroproducts business of the Chemours Company, an independent, publicly held company formed in 2015 from the separation of the performance chemical businesses of DuPont. She manages global raw material purchasing and logistics interactions supporting the fluoropolymers and fluorochemical businesses of Chemours. She has more than 30 years of experience in logistics and previously worked for DuPont and for Consolidated Rail Corporation (Conrail).

Pileggi was elected chair of NITL at the association’s 2017 Transportation Summit in San Diego. The Summit brought together more than 150 leaders from highway, rail, and maritime freight transportation to discuss the challenges facing the transportation industry as well as issues around energy, the multi-generational workforce, and leadership.

In addition to Pileggi, NITL members elected the following professionals to the League’s Board of Directors:

• Randy Brown (First Vice Chairman), Cargill
• Thomas Jensen (Second Vice Chairman), UPS
• Bruce Ridley (Third Vice Chairman), Packaging Corporation of America
• Michael Regan (Treasurer), TranzAct Technologies
• Erik Bohn, OMYA, Inc.
• Gary Burns, LyondellBasel Industries
• Sandra Dearden, Highroad Consulting
• Matt Ehlinger, NCH Corporation
• Robert Kemp, DRT Transportation
• Richard Kloster, AllTranstek
• Doug Kratzberg, ExxonMobil Chemical
• Travis Krous, Nestle Purina Petcare
• Chip Lidicker, CF Industries Sales
• Todd Lindhorst, Jones-Hamilton Company
• Bill Lovick, Georgia-Pacific
• Meredith Neizer, Armada
• Thomas Pellington, David J. Joseph Company
• Don Pisano, Green Coffee Association
• Curt Warfel, AkzoNobel Sourcing
• Rick Webb, Watco Companies

The 2017 chairs of NITL’s modal committees are as follows:

• Highway Transportation Committee: Jeff Tucker, Tucker Company Worldwide
• Ocean Transportation Committee: Julie Alsup, International Paper
• Rail Transportation Committee: Frank De Castro, Solvay Chemicals

On January 13, the League joined with nine other trade groups in submitting reply comments to the Surface Transportation Board (STB) regarding the board’s proposed rule on competitive rail switching.

The 10 organizations, known collectively as the Shipper Coalition for Railroad Competition, represent thousands of companies that ship goods ranging from fertilizer to fruits and vegetables. In October 2016, the Shipper Coalition submitted opening comments in support of the STB’s proposed rule, which was published in July 2016. The Association of American Railroads (AAR) and individual Class I railroads, as well as the American Short Line and Regional Railroad Association (ASLRRA), also submitted opening comments, but in opposition to the STB’s proposed rule.

The Shipper Coalition’s reply comments responded to the opening comments submitted by the railroads and reiterated key points contained in the coalition’s opening comments.

“In these reply comments, the Shipper Coalition cuts sharply through the noise and obfuscation of the railroads’ comments and makes clear that change to the 1985 Switching Rule is badly needed, and that the board’s proposed switching rule is lawful, rational, justified, and workable,” the introduction to the reply comments states. “The Shipper Coalition also debunks the railroads’ exaggerated claims that the proposed rule will wreak havoc on the rail network and discourage investment, and summarily dispatches multiple inchoate attacks based on vagueness, environmental, labor, and constitutional grounds.”

An overview of the League’s activities pertaining to the STB’s competitive switching rule is here.

The Federal Maritime Commission (FMC) has now officially acknowledged the League’s petition to the agency aimed at combating unfair demurrage and detention charges.  As previously announced, the League is leading a coalition of two dozen associations representing importers and exporters across a full spectrum of American industries.  The coalition is challenging the common practice of shippers and truckers being charged high fees for late pickup or redelivery of containers when adverse port conditions prevent them from acting within allowable free time.

The FMC issued a “Notice of Filing and Request for Comments” on Petition No. P4-16 on December 20^th and set a February 28, 2017 deadline for comments.  League members are strongly encouraged to file comments with the FMC, and the League will provide guidance and assistance for members wishing to share their views with the agency.

This important initiative will be discussed in detail at the League’s Summit in San Diego, CA January 30-February 1, 2017. If you haven’t made plans to join us there, register now to ensure your seat at the table for updates on this initiative and many others.