14 April 2015

[140415.EN.SEA] US Federal Maritime Commission Probes Alliances From Behind Closed Doors

THE US Federal Maritime Commission (FMC) is holding a closed-door talks to probe the impact of shipping alliances following months of quayside congestion on he east and west coasts that have crippled supply chains, reports Lloyd's List.

Commissioner Richard Lidinsky warned the industry that the FMC would continue to consult its global counterparts, as American regulators prepare for a second summit with their peers in Europe and China "to ensure alliances do not become supra-national forces".

Speaking to the Northeast Trade and Transportation conference in Newport, Rhode Island, Mr Lidinsky said shipping alliances had worsened port delays during the west coast labour crisis, which continues to have west coast harbours seriously congested.

"As ships began to gather at anchor off San Pedro Bay, a group of carriers came to us seeking a green light to impose congestion surcharges they had just published in their tariffs," he said.

Mr Lidinsky said the told them then: "No. You are trying to collect on a condition you caused."

The four big alliances, 2M, G6, Ocean Three, and CKYHE, all have regulatory clearance in the US, but the impact of these partnerships became clearer last winter when Los Angeles and Long Beach containers piled up forced ships to wait at anchor.

"Congestion was severe as many lines have interests in the 13 container terminals in the two ports. With each wanting to use its own facility, containers shipped by the various carriers were scattered across the complex, and had to be repositioned within the ports before being dispatched.

"Much of the port congestion troubles that just took place on the west coast reportedly resulted from alliance cargo, stowed to reflect new alliance ties, rather than previous stowage practices, so it had to be directed to a specific terminal or trucker, thus exacerbating the overall problems," he said.

"At the root of alliance formation are the increasing number of mega ships of such size that they cannot today, and very likely not tomorrow, call at US ports," said Mr Lidinsky.

Bigger ships contributed to the congestion too, he said. "Instead of an organised system in which containers are assembled by destination, the larger alliance ships have left containers randomly on the terminals.

"Getting the right cargo to the right place can involve moving the container an excessive number of times, as opposed to the usual two or three," he said.

Mr Lidinsky said if the US is to get to grips with alliances and how they impact US waterborne commerce, "we must have the regulatory conviction to say to alliance cross-traders, 'enough is enough, and you will serve our importers, exporters, ports, inland transport network and, above all, our consumers with fair rates and efficient vessel practices'."

Source : HKSG.

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