Month: September, 2019

September 17, 2019 General 294

Lufthansa Cargo lifts Flexport Ban - But The Inside Story Shows Best Practice At Workpermalink

Alex Lennane

The Lufthansa Cargo embargo on three companies over an ‘incident’ involving dangerous goods has been lifted, the carrier has confirmed to The Loadstar. There has been quite some noise over the ban, in part because one of the companies involved was Flexport Asia, the forwarder everyone loves to hate. There have been various and potentially damaging remarks over the ‘incident’, despite the details not being made public.

I was surprised, how everyone kept jumping to conclusions, especially when LH (Lufthansa) had provided little to no information on the incident.

This story also provides hints to freight forwarders to be even more vigilant when handling DG cargo or Li-ion batteries, and shouldn’t rely solely on exporters, who may at times could place incorrect labels on the cargo, which had been the case in this incident. Therefore, forwarders must ensure the proper labels are placed on the cargo according to the MSDS1 before handing over to the carrier.

Li-ion batteries are very commonly used in everyday electronics, such as from our laptops, cell phones to children toys etc, and IATA has a clear instructions on its handling through air cargo, which must be ensured at all times. IATA Li-ion Battery Guide 1MB

12 September 2019
Alex Lennane /
Lufthansa Cargo blacklists vape shipper and forwarders after lithium ion incident
A Chinese vape manufacturer, Shenzhen AbuFan Technology, has been blacklisted by Lufthansa Group carriers for all forms of airfreight, following an incident at Hong Kong Airport. Vapes contain lithium ion batteries, which are highly regulated and must be packaged and correctly labelled.

This entire episode that spanned over a week, began when Lufthansa Cargo Hong Kong (LH HKG) issued a Circular.txt banning a vape manufacturer, and two other freight forwarders involved in the incident of mislabeling of the cargo that contained Li-ion batteries.

28 August 2019
Frank Chen /
Fire on A330 jet may cost Air China 1.7 bln yuan
A preliminary investigation on Wednesday linked the fire to the lithium battery packs inside the main deck cargo compartment, but questions have been raised about if the batteries were part of a consignment or part of the plane’s own power supply system.

However according to what I could gather, this move was triggered by an incident that took place a month ago, where an Air China passenger flight caught fire IMG at the Beijing Airport, and caused to collapse its airframe., the incident was linked to Li-ion batteries in the main deck cargo compartment of the aircraft.

The LH circular instantly stirred up a lot of buzz over the linkedin, because one of the freight forwarders involved was Flexport, a San Francisco based technology startup and freight forwarder.

The embargo however was lifted in a week or so, and most likely Lufthansa Cargo Hong Kong (LH HKG) acted out of extreme caution, in the wake of recent Air China incident.

1. A Material Safety Data Sheet (MSDS) is a document that contains information on the potential health effects of exposure to chemicals, or other potentially dangerous substances, and on safe working procedures when handling chemical products. It is an essential starting point for the development of a complete health and safety program. It contains hazard evaluations on the use, storage, handling and emergency procedures related to that material. The MSDS contains much more information about the material than the label and it is prepared by the supplier. It is intended to tell what the hazards of the product are, how to use the product safely, what to expect if the recommendations are not followed, what to do if accidents occur, how to recognize symptoms of overexposure, and what to do if such incidents occur. Source

September 9, 2019 General 240

Pakistan's Garment Industry Could Become More Competitive Than Bangladesh Due To Massive Currency Devaluationpermalink

Ruma Paul

The government of the world’s second biggest garment exporter behind China said this week it would consider demands for an increase in the minimum wage, after clashes between police and protesters killed one worker and wounded dozens. The government said in September that the minimum wage for garment workers would increase by up to 51 percent this year to 8,000 taka ($95) a month, the first such increase since 2013. But union leaders say that increase will benefit only a small percentage of workers in the garment sector, which employs 4 million in the country of 165 million people. Low wages and trade deals with Western countries have made the sector a $30 billion industry accounting for 80 percent of Bangladesh’s exports.

Pakistan started to devalue its currency beginning from 2017 and until now it has depreciated more than 50% against the US Dollar, triggering a ripple effect across its export sector, and making it more competitive in low-wages industries. PKRUSD

With regard to garment industry, Bangladesh1 had a per month minimum wage of $64 in 2018 versus $136 in Pakistan. However things have quite changed since then in 2019, Bangladesh has raised the wages to $95 and on the contrary Pakistan’s minimum wage per month declined to $1072 due to massive currency devaluation.

Further Reading
Nasir Jamal /
Textiles languishing by the wayside

However, the chances of the textile and clothing exporters increasing their share in international trade — both in terms of export value and quantity — despite emerging global opportunities are minimal because of the shrinking size of the industry. The industry’s capacity to produce exportable surplus has contracted substantially because of factory closures on the back of crippling energy shortages that hit the economy in the second half of 2000s, the previous government’s obsession for an overvalued rupee, lack of investment in new more efficient technologies and capacity, the controversial free trade agreement with China and so on.

However lower wages alone are not going to help Pakistan increase its global market share, due to lack of the production capacity as the above article stated. Government must work toward attracting foreign investment in the textile and garment sector., as well as encourage local industrialists by facilitating them with cheaper energy prices, and waiving duties and taxes on the import of textile machinery and its parts altogether.

1. A historical fact, Bangladesh was known as East Pakistan until the 1971 fiasco that led to division of the two parts. West Pakistan is now simply referred to as Pakistan.

2. The data is based on the source Renaissance Capital and adjusted to open market exchange rates, it may not be 100% accurate nevertheless provides a reasonable guidance.

September 7, 2019 General 277

Pakistan's Exports To US Increased by 6.11% YoY and 24.1% Overall in May 2019permalink

The total exports to the USA during July-February (2018-19) were recorded at $2684.394 million against the exports of $2529.610 million during July-February (2017-18), showing an increase of 6.11 percent during the period, according to State Bank of Pakistan (SBP). This was followed by United Kingdom, wherein Pakistan exported goods worth $1171.950 million against the exports of $1161.099 million last year, showing growth of 0.93 percent. China was the at third where Pakistan exported products worth $1150.523 million during the current fiscal year against the exports of $1107.004 million during last fiscal year, showing increase of 3.93 percent, SBP data revealed. Among other countries, Pakistani exports to Germany stood at $869.763 million against $909.251 million during last year, showing decline of 4.34 percent while the exports to Afghanistan were recorded at $777.292 million against $1008.555 million last year, the data revealed.

I guess, it most likely would be due to trade war and tariff on the chinese goods as well as over 30% currency depreciation1 against the US Dollar in the past year, rather than our Govt., doing anything to help the local industries.

Difference in % YoY Monthly Basis. Exports started to trigger after 2017, when Govt decided to devalue Rupee against US Dollar over 50% since 2017. PKRUSD

Further Reading
Pakistan Total Exports Growth

Pakistan’s Total Exports expanded 19.1 % YoY in Jun 2019, compared with an increase of 24.1 % YoY in the previous month. Pakistan’s Total Exports Growth data is updated monthly, available from Dec 1988 to Jun 2019, with an averaged rate of 12.9 %. The data reached an all-time high of 53.4 % in May 1991 and a record low of -19.2 % in Sep 2015. CEIC calculates Total Exports Growth from monthly Total Exports. The Pakistan Bureau of Statistics provides Total Exports, FOB, in local currency.

1. The devaluation of economy /

September 4, 2019 General 262

What is an HS or HTS Code?

An HS or HTS code stands for Harmonized System or Harmonized Tariff Schedule. Developed by the World Customs Organization (WCO), the codes are used to classify and define internationally traded goods. In most cases, in order to import or export a product internationally, the traded good must be assigned an HTS code that corresponds with the Harmonized Tariff Schedule of the country of import1.

The difference between an HS code and HTS code is the number of digits within the code. A code with six digits is a universal standard (HS Code) and a code with 7-10 digits (HTS Code) is often unique after the 6th digit and determined by individual countries of import.

These codes are important because they not only determine the tariff/duty rate of the traded product, but they also keep a record of international trade statistics that are used in nearly 200 countries. For example, the United States Census uses these codes to determine the value, quantities, weights, countries traded with, and more, of every product that the United States imports and exports.

Definition & Example for U.S HTS Code
Chapter 09 Coffee, Tea, Matte and Spices
Heading 0901 Coffee, Whether Or Not Roasted Or Decaffeinated; Coffee Husk, and Skins Coffee substitutes containing Coffee.
Sub Heading 0901.21 Coffee, Roasted, Not Decaffeinated
subheading 0901.21.00 No Distinction
Statistical Suffix 0901.21.0010 Coffee, Roasted, Not Decaffeinated, Certified Organic


1. In rare cases an item may need a clarification or ruling from the customs to properly assign it the correct HS/HTS code, due to an ambiguity. In US, Customs Ruling are available online at