Agricultural exporters in the US urged authorities to impose greater scrutiny on shipping alliances and the behaviour of shipping lines during the pandemic.
As the Agriculture Transportation Coalition (AgTrans) noted, “a system of global alliances dominates global shipping, where nine carriers that have been organised into three alliances control about 80% of the global shipping market, and 95% on the critical east-west tradelanes.”
This lack of competition leaves American businesses at the mercy of just three alliances. Retailers are charged fees for their container remaining on the docks, even if there is no way to move their containers. If the alliances decide to not accept exports, agricultural exporters will not be able to fulfil their contracts, and farmers’ perishable products may be left to rot
However, AgTrans noted that there are improvements at the ports of Los Angeles and Long Beach, mentioning that 60,000 empty containers have now been moved from the two west coast ports. What is more, the number of boxes waiting on he docks for more than nine days has been reduced by one-third in the first two weeks of November.
What is more, the organisation added that the congestion fee imposed on lines by the ports helped shift “long-dwelling containers”.
The ocean carriers have now agreed to clear more of these empties from the docks faster, including bringing in vessels dedicated to empty removal. Based on these new commitments, they have already cleared out 60,000, with commitments to remove another 28,000
However, the coalition believes that “more work is needed”, as the current system raises questions “about fair treatment”. For this reason, AgTranshas called on the FMC to use more tools to scrutinise the carriers.
While the alliances between carriers receive statutory immunity from antitrust laws, the FMC can challenge those agreements if they ‘produce an unreasonable reduction in transport service or an unreasonable increase in transport cost or substantially lessen competition
Namely, tThe FMC said earlier this week that it was establishing ‘six supply chain innovation teams’, to begin meeting on 1 December, to identify where improvements could be made to the processes.
In addition, the White House has also called out the three major shipping alliances that “dominate” the trade critical East-West trade and challenged the FMC to use “all the tools at its disposal” to ensure importers and exporters are not affected with unfair or perhaps even illegal fees.
