Tuesday, October 8, 2019 General

The Life of A Freight Forwarder

We are capable of calculating quotations for three major projects, making booking for 5 different shipments and answering 12 totally unnecessary calls per hour, all simultaneously. We do not require sleep and are at your service 25 hours a day, 8 days a week. Our home numbers are your numbers.

We are responsible for production delays, traffic jams, mechanical problems with trucks, aircraft and ships and depressed economic conditions overall. We are totally responsible for any lost or damaged freight and will personally replace it upon request.

We have powers which allow us to add unlimited weight and volume to and upon an already overloaded truck. We create miracles by loading unlimited weight and volume into airline/ sea freight containers. Furthermore, we can always motivate drivers to be your free-of-charge temporary employees to help with loading and unloading.

Yesterday’s delivery requirements with cargo loading today are regularly completed the day before yesterday, ten times a day, every day. We know that when you order a truck for loading on Monday that you really needed it on Saturday, but that you only want the overnight load delivered the following Wednesday. You want us to be at the office on weekends & public holidays to unload your goods at 2 am to ensure that your truck returns in time for your normal deliveries.

We are always friendly with a smile, have mastered telepathy, show empathy and gladly act as our customers’ psychiatrists. We embrace the challenge when you cancel the space with the airline and one hour later expect the airline to hold the space for you just in case you require the capacity again, and do this daily.

We embrace the opportunity that you allow us to develop our negotiation skills with airline staff in securing capacity on already overbooked flight and allowing us to freely negotiate a cheap spot rate for the freight as well.

We speak all languages and know the location of even the smallest town anywhere in the world. We are able to obtain a freight rate inclusive of clearance and door delivery to the strangest of places at a moment’s notice. At your request we can comply with any and all additional requirements your company may have. We also repair vehicles and computers!

For undisturbed road traffic, we have clocked our vehicles and if that does not resolve a traffic jam, we are capable of freeing the roads of traffic, upon request, in order to meet cut-offs.

Naturally, payment of our invoices is optional, and if your company has financial difficulties we will gladly advance unlimited funds for as long as you require them.

Our lives have been enriched by the endless opportunities that you have allowed us to experience.

Sincerely,

Your Eternally Grateful.

Tuesday, September 17, 2019 General

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

theloadstar.com

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 / theloadstar.com
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 / www.asiatimes.com
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

Monday, September 9, 2019 General

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

www.reuters.com

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 / www.dawn.com
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.

Saturday, September 7, 2019 General

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

nation.com.pk

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
CEIC / www.ceicdata.com
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 / thefrontierpost.com

Wednesday, September 4, 2019 Informative

What’s 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
Source www.datamyne.com

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 https://rulings.cbp.gov/home

Thursday, August 29, 2019 Informative

What is Third-party Logistics 3PL?

Third-party logistics (abbreviated as 3PL, or TPL) in logistics and supply chain management is an organization’s use of third-party businesses to outsource elements of its distribution, warehousing, and fulfillment services.

Third-party logistics providers typically specialize in integrated operations of warehousing and transportation services that can be scaled and customized to customers’ needs, based on market conditions, to meet the demands and delivery service requirements for their products.

Often, services exceed logistics to include value-added services related to the production or procurement of goods, such as services that integrate parts of the supply chain.

A provider of such integrated services is referenced as a third-party supply chain management provider (3PSCM), or as a supply chain management service provider (SCMSP). 3PL targets particular functions within supply management, such as warehousing, transportation, or raw material provision.

Source en.wikipedia.org  PDF 159KB

 

Thursday, August 29, 2019 Informative

What is an Ocean Transportation Intermediary (OTI)?

An ocean transportation intermediary (OTI) is a company that is licensed by the Federal Maritime Commission (FMC) to operate in the United States as an ocean freight forwarder, non-vessel operating common carrier (NVOCC), or both.

How to Apply for an OTI License. www.fmc.gov

 

What is an OTI Bond?

OTI bonds are required by the Federal Maritime Commission (FMC) from all ocean freight forwarders (OFFs) and non-vessel-operating common carriers (NVOCCs) who wish to become licensed as ocean transportation intermediaries (OTI) and operate in the United States.

The cost of your OTI bond depends on its bonding amount– whether it’s a $50,000, $75,000, $96,000, or $150,000 bond. When determining the rate or surety premium of a bond, sureties base it on the total bonding amount and make it a percentage thereof.

To determine your rate, sureties look at your personal credit score first and foremost, and at other financial and business-related items, such as your financial statements or industry experience.

If you have a high credit score and a solid business history you can expect to receive a standard market rate: from 1%-5% of the total amount of your bond. If your credit score isn’t that high, the surety will typically offer a rate that’s between 5%-10% of the bonding amount.

So, to obtain a NVOCC bond at standard rates for a licensed U.S. entity you would have to pay between $750 and $3,750.

For complete details visit Lance Surety Bonds website. www.suretybonds.org
Complete List of Registered OTIs / NVOCCs 2019 By FMC Records 364KB

 

Thursday, August 29, 2019 General

Google is moving Pixel production from China to an old Nokia factory in Vietnampermalink

www.theverge.com

Chaim Gartenberg / Verge

Google is said to be starting by shifting some of the Pixel 3A’s manufacturing to the Vietnam plant, with the goal of moving production there before the end of this year. New products are still expected to be built in China for now, which likely will include the forthcoming Pixel 4. Google isn’t the only company eying Vietnam for phone production: an earlier Nikkei report notes that Apple may be looking to shift between 15 to 30 percent of iPhone production to Vietnam and India to avoid tariffs, too.

Honestly I had been skeptical of Vietnam’s production and infrastructure capabilities. But it seems like they can still produce / assemble high-end consumer electronics too. Along with Malaysia, Taiwan and India to avoid tariffs. However as the article noted, the next iteration of Pixel Phones 4, still to be built in China.

Further Reading
Lauly Li / asia.nikkei.com
Apple weighs 15%-30% capacity shift out of China amid trade war

Apple has asked its major suppliers to evaluate the cost implications of shifting 15% to 30% of their production capacity from China to Southeast Asia as it prepares for a fundamental restructuring of its supply chain, the Nikkei Asian Review has learned.

 

Monday, August 26, 2019 Statistics

Top 50 Container Sea Ports 2014-2018

Yearly Volume in Million of TEUs.

Rank Port 2018 2017 2016 2015 2014
1 Shanghai, China 42.01 40.23 37.13 36.54 35.29
2 Singapore 36.6 33.67 30.9 30.92 33.87
3 Shenzhen, China 27.74 25.21 23.97 24.2 24.03
4 Ningbo-Zhoushan, China 26.35 24.61 21.6 20.63 19.45
5 Guangzhou Harbor, China 21.87 20.37 18.85 17.22 16.16
6 Busan, South Korea 21.66 20.49 19.85 19.45 18.65
7 Hong Kong, S.A.R, China 19.6 20.76 19.81 20.07 22.23
8 Qingdao, China 18.26 18.3 18.01 17.47 16.62
9 Tianjin, China 16 15.07 14.49 14.11 14.05
10 Jebel Ali, Dubai, United Arab Emirates 14.95 15.37 15.73 15.6 15.25
11 Rotterdam, The Netherlands 14.51 13.73 12.38 12.23 12.3
12 Port Klang, Malaysia 12.32 13.73 13.2 11.89 10.95
13 Antwerp, Belgium 11.1 10.45 10.04 9.65 8.98
14 Kaohsiung, Taiwan, China 10.45 10.27 10.46 10.26 10.59
15 Xiamen, China 10 10.38 9.61 9.18 10.13
16 Dalian, China 9.77 9.7 9.61 9.45 10.13
17 Los Angeles, U.S.A 9.46 9.43 8.86 8.16 8.33
18 Tanjung Pelepas, Malaysia 8.96 8.38 8.28 9.1 8.5
19 Hamburg, Germany 8.73 8.86 8.91 8.82 9.73
20 Long Beach, U.S.A. 8.09 7.54 6.8 7.19 6.82
21 Laem Chabang, Thailand 8.07 7.78 7.22 6.82 6.58
22 Tanjung Priok, Jakarta, Indonesia 7.64 6.09 5.51 5.2 5.77
23 New York-New Jersey, U.S.A. 7.2 6.71 6.25 6.37 5.77
24 Colombo, Sri Lanka 7.05 6.21 5.73 5.19 4.91
25 Yingkou, China 6.5 6.28 6.08 5.92 5.77
26 Ho Chi Minh City, Vietnam 6.33 6.16 5.99 5.31 6.39
27 Bremen/Bremerhaven,Germany 5.42 5.51 5.49 5.48 5.78
28 Manila, Philippines 5.05 4.82 4.52 4.23 3.65
29 Jawarharlal Nehru Port (Nhava Sheva), India 5.05 4.83 4.51 4.49 4.45
30 Piraeus, Greece 4.91 4.15 3.73 3.37 3.59
31 Algeciras, Spain 4.77 4.39 4.76 4.52 4.56
32 Lianyunguang, China 4.75 4.72 4.7 5.01 5.01
33 Tokyo, Japan 4.57 4.5 4.25
34 Mundra, India 4.44 4.24 4.8 2.99 2.7
35 Savannah, U.S.A 4.35 4.05 3.64 3.74 3.35
36 Jeddah, Saudi Arabia 4.12 4.15 3.96 4.19 4.2
37 Santos, Brazil 4.12 3.85 3.6 3.78 3.68
38 Rizhao, China 4 3.24 3.01
39 Colon, Panama 3.89 3.89 3.26 3.58 3.29
40 Felixstowe, U.K. 3.85 4.3 4.1 4 3.74
41 Seattle-Tacoma NW Seaport Alliance, U.S.A. 3.8 3.7 3.62 3.53 3.43
42 Dongguan, China 3.5 3.91 3.64
43 Tanger Med, Morocco 3.47 3.31 2.96
44 Barcelona, Spain 3.42 2.97 2.23
45 Vancouver, Canada 3.4 3.25 2.92
46 Salalah, Oman 3.39 3.94 3.32 2.57 2.96
47 Fuzhou, China 3.34 3.01 2.66
48 Marsaxlokk, Malta 3.31 3.15 3.08 3.06 2.9
49 Nanjing, China 3.23 3.17 3.08 2.94
50 Cai Mep, Vietnam 3.2 3.07 2.56

Rank No. 1 Shanghai, China. 2014-2018 Volume in Millions of TEUs. We shall find out after the end of FY 2019, If Shanghai could maintain its volume increase YoY post the tradewar.

Top 10 Container Seaports in terms of Yearly Volume in Millions of TEUs from 2014-2018

 

Top 50 Container Seaports 2014-2018 57KB

Source data: The Journal of Commerce annual Top 50 World Container Ports, Lloyd’s List annual Top 100 Ports, AAPA World Port Rankings, Drewry World Container Traffic Port Handling and individual port websites, American Journal of Transportation Top 100 ports.