Major Alliances, Port Congestion Next on FMC’s Agenda

The US Federal Maritime Commission is going to discuss congestion at US ports and major carrier alliances at a closed meeting scheduled to take place in Washington on April 13th.

The meeting comes in the wake of raised concerns that the recently established mega-alliances of container lines have been the cause of severe shipping delays.

In March, FMC member Michael Khouri called on the Commission to request all of the four major alliances to provide new information on the steps each is taking to reduce congestion at U.S. ports.

“We have received private reports and seen numerous press accounts that the operations of the four alliances – G6, CKYHE, Oceans 3, and 2M – may be a contributing factor in the chronic congestion at the West Coast ports, and perhaps at other port facilities,” Khouri said.

Reports have alleged that loading practices at Asian ports have significantly increased the homogenous mix of the various alliance members’ containers on each alliance vessel. Consequently, upon arrival at a West Coast port terminal, a significant number of containers need additional intra-facility ground moves to and among each of the local terminals operated by the individual alliance members before the container is dispatched out of the port complex.

Commissioner Khouri called for each alliance to report to the Commission on steps each is taking to ameliorate and eliminate congestion issues at U.S. ports.

The Global Shippers Forum (GSF) called for rigorous monitoring of key performance indicators (KPIs) which would confirm that ocean shipping alliances can deliver tangible benefits in terms of reduced costs, competitive ocean rates and improved services for shippers. In addition, the GSF called EU, US, and Chinese regulatory and competition authorities to share monitoring data and information to prevent potential competition abuses.

The congestion at US ports has been influenced by numerous other factors including nine-month long labor-talks, chassis, and drayage drivers. However, with the approval of the new labour agreement in sight, a question of infrastructure remains to be addressed.

Namely, as stressed by FMC Chairman, Mario Cordero, while speaking at the 2015 Legal Ports Conference in Long Beach, as ships grow in size, bringing increased influx of cargo, the US needs to invest in modernization of its port infrastructure to meet the needs of such trend.

The closed meeting will also include discussions on staff report on rules, rates, and practices relating to detention, demurrage, and free time for containerized imports and exports moving through selected U.S. ports.

World Maritime News Staff