The situation is getting worse. Since November 19, 2023, 40+ vessels have been attacked in the Red Sea. Several steamship lines have suspended service to major Middle Eastern ports, and others are rerouting around the Cape of Good Hope, but this is adding significant transit time of roughly two weeks.
Panama Canal
The Panama Canal Authority announced that it will increase the number of daily slots available in the Panamax Locks on March 18th from 24 to 27 vessels per day.
Container Spot Prices
Spot pricing is declining but still prevalent in the market due to the rebalancing of equipment thrown awry by the Red Sea Crisis.
East and Gulf Coast Ports Labor Contract Negotiations
As we approach contract negotiations for East Coast and Gulf Coast ports, the landscape appears distinct from recent West Coast discussions. Previous cargo bottlenecks have eased, and ocean carriers are experiencing a decline in record earnings from the previous years. The International Longshoremen’s Association (ILA) aims to leverage recent wage gains by other transportation unions, such as the recent ILWU Local 13 contract ratification, signaling a potential strike threat if a new multiyear contract isn't settled before the current one expires in September.
Harold Daggett, the ILA’s president, promises unprecedented benefits in the forthcoming contract to the rank-and-file union workers, which represents around 45,000 workers.
There are heightened concerns for retailers preparing for holiday sales amidst the looming possibility of a strike during the peak shipping season.
Speculation arises about the likelihood of a coast-wide strike, particularly given its timing before the U.S. presidential election.
Despite the optimism expressed by some industry officials, reconciling the ILA's demands with carriers' financial constraints poses a significant challenge, setting the stage for complex and pivotal discussions in the coming months.
Bonds are required for a wide range of transactions and activities, and are the primary tool used by U.S. Customs and Border Protection (CBP) to safeguard U.S. revenue and ensure compliance with applicable laws and regulations.
What's New?
The Office of Trade’s Trade Policy and Programs has worked with public stakeholders, the Office of Finance, Office of Field Operations, Office of Chief Counsel, and Regulations and Rulings since 2020 to update CBPs’ internal directive on Monetary Guidelines for Setting Bond Amounts, first issued in 1991, to reflect current policies and procedures. The updated directive is one of several sources used to create this guide.
Extensive changes have occurred over the last 30 years. This includes the transition of customs functions from the Department of Treasury to the Department of Homeland Security, creation of CBP, changes to CBP’s internal handling of various aspects of bond policy and procedure, the introduction of new, and termination of unnecessary, bond requirements, and the creation of the Automated Commercial Environment (ACE) eBond test. Due to these changes, publication of this guidance is an important step along the way to updating and standardizing CBP’s bond policy and administration across the agency. It serves to address gaps, to clarify what CBP and the trading public are responsible for when setting and maintaining sufficient bond coverage, and make clear what factors are considered by CBP in setting a required bond amount in particular cases.
The collaborative nature of this program presents a unique opportunity for CBP and the trade community to continually maintain and advance the bond program in support of CBP’s priority to facilitate lawful trade and protect U.S. revenue.