News

October 16, 2020

Ontario Proposes Allowing 24-Hour Deliveries

Proposed legislation in Ontario would pave the way for 24-hour deliveries to businesses. The Main Street Recovery Act, 2020, introduced by Associate Minister of Small Business and Red Tape Reduction, Prabmeet Sarkaria, contains measures to help small businesses rebuild, reinvest and create jobs.

The proposal, among other things, would permanently allow 24/7 deliveries to businesses including retail stores, restaurants, and distribution facilities.

The proposed legislation was welcomed by the Region of Peel, which has been piloting off-peak deliveries.

“The Region of Peel has long recognized that the regional economy is dependent on a strong goods movement system,” said Peel Goods Movement Task Force chairman Nando Iannicca.

“Peel also knows that our goods movement system is facing strong growth pressures and businesses are becoming increasingly challenged with delivering goods and services to the community. This Bill, if passed, will allow for a timely and consistent movement of essential goods and supplies, assuring the people of Ontario that essential supplies will be available at their drug stores, supermarkets, and other retailers across the province when needed.”

“The passing of this Bill will be welcomed news and a big win for our local businesses, the environment and residents commuting throughout the Greater Toronto Hamilton Area,” added Caledon mayor Allan Thompson.

“Our supply chain is more important than ever and this flexibility will have many positive spin-offs.”

The Region of Peel’s Off-Peak Delivery Pilot with the University of Toronto, the LCBO, Loblaw, and Walmart Canada, showed goods movements improved by 18.1 percent, and emissions related to congestion fell 10.6 to 15 percent.

(Source: Inside Logistics)

October 14, 2020

Webinar Recording — Avoid Audits and Delays While Increasing Your eCommerce Business

On September 30, we hosted a webinar in partnership with Miller Thomson LLP about ecommerce and the importance of employing a digital-first strategy in the COVID-era.

In case you weren’t able to join us — or just need a refresher — follow the link below to access the presentation and webinar recording.

View Webinar Recording

We also encourage you to download our free ecommerce guide.

Download eCommerce Guide

Please feel free to reach out to Carson at any time if you have any questions.

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October 13, 2020

Global Digital Tax Deal Delayed Until Mid-2021

A deal on how large tech companies like Amazon and Google should be taxed worldwide has been delayed until the middle of next year, amid entrenched political differences over how to rewrite tax rules for the digital age.

Members of the Organization for Economic Cooperation and Development were expected to strike an agreement on the so-called Digital Services Tax by the end of 2020, but Pascal Saint-Amans , who heads the tax policy centre at OECD, told reporters the new rules would now likely be decided by June 2021.

Almost 140 countries have spent several years crafting digital tax proposals after national governments pushed ahead on their own to force some of the world’s largest tech companies to pay more into national coffers.

Saint-Amans said that major political differences, particularly on which companies should be included in the new regime and whether the rules would be mandatory, still must be overcome before any deal could be signed.

Paris and Washington, in particular, have butted heads repeatedly on how these digital taxes should be implemented, and several countries and regions — including the European Union — have warned they will push ahead with their own unilateral plans if a global agreement cannot be reached.

(Source: Politico)

October 7, 2020

Trump Administration Opens Investigation Into Vietnam’s Trade Practices

The Trump administration has opened an investigation into Vietnam’s trade practices, a step that could result in tariffs on the country’s products and potentially open a new front in the Trump administration’s global trade war.

The Office of the United States Trade Representative said it would begin looking into two issues: Vietnam’s importation and use of timber, which it said was illegally harvested and traded, and whether Vietnam has undervalued its currency, making its products unfairly cheap abroad.

The investigation will be carried out under Section 301, the same legal provision that the Trump administration used to start its trade war against China. The agency did not announce a timeline for the investigation, but it appears unlikely to conclude before the presidential election.

Vietnam is a major U.S. supplier of machinery, apparel, footwear and other products. American imports from Vietnam, and the U.S. trade deficit with the country, soared in 2019, largely as a result of Mr. Trump’s trade offensive against China.

After the United States imposed tariffs on more than $360 billion of Chinese goods, many manufacturers sought to relocate their operations out of China to other countries with low-cost labor, including Vietnam and Mexico. Electronics companies like Apple, Nintendo and Foxconn all rushed to secure Vietnamese factory space. The profitability of some of those operations could now be cast into doubt, if the United States chooses to impose broad tariffs on Vietnam.

In 2019, the Treasury Department included Vietnam on a watch list for its currency practices, along with China, Germany, Ireland, Italy, Japan, Malaysia, Singapore and South Korea. In August, the Treasury Department also said that Vietnam had manipulated its currency in a trade case that the Department of Commerce brought against Vietnam tire manufacturers.

(Source: Business Insider)

October 7, 2020

U.S. West Coast Ports Could Lose Up to 45% of Intermodal Imports to Rival B.C. Ports

A study commissioned by the Pacific Maritime Association warns that high terminal charges, U.S. rail costs and other competitive factors could cause U.S. West Coast ports to lose up to 45% of intermodal import business to rival ports in B.C. by 2030.

The two B.C. container ports, especially Prince Rupert, have cost advantages of several hundred dollars per import FEU-load over both the San Pedro Bay gateway and the Puget Sound gateway for intact intermodal imports from Asia to the mainland metro markets that the Canadian National Railway and/or Canadian Pacific Railway serve.

The U.S. markets most vulnerable to Canadian competition are Chicago, Memphis, Minneapolis, and Detroit, which collectively account for nearly 45% of all intact intermodal volume moving through U.S. West Coast ports.

For intact intermodal cargo, the report found that the two B.C. ports have significant route cost advantages as high as $600 per container over U.S. West Coast ports.

With projects currently under at both B.C. ports that will add significant additional capacity at both terminals, U.S. West Coast ports will face further challenges with respect to volume and share loss.

Click here to read the full report.

October 7, 2020

Liner Schedule Reliability Hits Record Low as Rates Peak

Average global liner schedule reliability hit an all-time low in August, according to a new study from Copenhagen-based Sea-Intelligence.

Reliability in August across all trade lanes stood at 63.7% meaning less than two out of three ships got to their destination on time, despite the fact that clients were paying record high rates for late deliveries.

Sea-Intelligence has detected a gradual decline in global reliability since 2015, but this recent measurement is below the overall long-term trend.

The decline in reliability is likely to cause increased friction between carriers and shippers, after months of mounting tensions.

(Source: Splash 247)

October 6, 2020

Asian Shippers Facing Capacity Squeeze

Shippers in Asia are facing equipment shortages and tight shipping capacity that is driving an aggressive spike in short-term contract rates.

Vessels to North Europe and the US west coast are reportedly “fully booked for two to three weeks after Golden Week”, according to one Shanghai-based NVOCC source.

“Additionally, some of the carriers just do not have any 40ft high-cube containers at their depots, so even if we could get a booking, we can’t get hold of the boxes,” he said.

In its latest Container Availability Index (CAx) update, Container XChange reports container availability “dropping across Asian ports”, and doesn’t see the situation improving promptly.

In addition to ramping up empty container repositioning programs at the expense of backhaul loads, to mitigate the shortages, carriers have also tightened up on the time allowed to pick up equipment before export loading in China, and reduced the free time for restitution in Europe and the U.S.

Carriers have been relatively quiet on vessel utilization levels in past weeks, but a press release from HMM confirms the strength of demand since early May when HMM Algeciras, the first of its newbuild 24,000 teu ULCVs, sailed from China to Europe with a full load of 19,621 teu.

Subsequently, all 12 of the ULCV series, the biggest container vessels by capacity in the world, had departed from Asia on their maiden voyages, fully laden – a scenario that had seemed extremely unlikely at the start of the global pandemic in March.

The delivery of the 12 ULCVs was perfect timing for the embattled South Korean carrier, which had suffered 21 consecutive quarters of negative results. The state-supported line managed to achieve its first quarterly net profit in over five years between April and June, of $23m.

(Source: The Load Star)

October 5, 2020

Trump COVID-19 Hospitalization Obfuscates Trade Agenda

Some trade issues could be left unresolved if the president’s COVID-19 symptoms worsen and he has to cut back on official duties before the election, experts told Politico Morning Trade.

Major executive actions, like new moves on the TikTok or WeChat bans, and issues where the president has taken special interest, like EU aircraft tariffs, could take a backseat if the president has to reduce his workload.

Some trade experts say the White House may be goaded into more protectionist actions — especially against China — to try to change the subject in the coming weeks if Trump’s condition continues to dominate the headlines.

“He is a master of distraction and changing the subject, so I definitely would expect something,” said Bill Reinsch, a former Clinton trade official now at the Center for Strategic and International Studies. “Since both candidates are accusing each other of being soft on China, I can see him being tempted to do something to show he’s tough, however counterproductive it might be.”

Former officials and trade experts say his lauded Maine lobster, Wisconsin dairy and Florida seasonal crop deals — to name a few — could help him garner support from voters in the states he needs for reelection.

“The advantage of incumbency is you can do things and take action and enact your policies that have positive political impact for you,” said Tim Keeler, a former USTR and Treasury Department official. “It can’t hurt him.”

While he’s failed to deliver on some of his bigger promises including a full-on Japan deal, phase two China deal or breakthrough with the European Union or India, experts suggest a strategy to showcase the small wins and anticipated benefits of USMCA.

(Source: Politico Weekly Trade)

October 2, 2020

North American Supply Chains Continue to Feel Impact of Port of Montreal Strike

Following a strike by dockworkers that lasted for one month and paralyzed operations at the Port of Montreal in August and September of this year, Resilience360 research indicates that major ports both on the west and east coast of Canada continue to experience disruption ranging from port congestion to rail car shortages.

Click here to review the Port of Montreal strike.

“While the strike ended more than four weeks ago, ocean and rail dependent supply chain operations across Canada are unlikely to fully normalize before November 2020,” says Neža Kričaj, Supply Chain Risk Analyst, Resilience360. “Supply chain managers are therefore advised to adjust their routes and shipments accordingly, and explore options to divert cargo to alternative modes of transportation wherever possible.”

“At Montreal, some shippers are reportedly using truck delivery instead of rail to reach Toronto faster and terminals are also offering short-sea services to Toronto,” she said.

She added that the impact has yet to felt by U.S. West Coast supply chain managers.

“In the short term, there might be some expedited ocean services that bypass the Canadian ports, but most large vessels on West coast rotations call first at the Canadian ports after crossing from East Asia so the big volumes will continue to go through there. Vessels delays might actually trickle down into US ports such as Tacoma and Seattle as well,” she said.

In the long term, however, Canadian ports will not only have a cost and time advantage, but also more capacity as they expand terminals and could actually divert more cargo from U.S. west coast ports, she added.

On the east coast, large amounts of container backlogs continue to be cleared and port operations are expected to return to normal by early October.

The imbalance of rail cars in the network, coupled with large incoming volumes and labor shortages, have also caused severe congestion at ports on Canada’s west coast since last month. The rail car imbalance was partly caused by vessel diversions to east coast ports due to the strike at the Port of Montreal. Carriers expect the situation to normalize by October.

We encourage you to reach out to us for guidance around how to navigate these complex freight issues as we continue to move through the COVID-19 pandemic.

We will continue to provide updates as they become available, and are always available to answer any questions or concerns.

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(Source: Logistics Management)

September 30, 2020

Canada Not Benefitting From CETA

Canada’s Minister of Agriculture Marie-Claude Bibeau admits the country is not benefiting from the Comprehensive Economic and Trade Agreement (CETA) with the European Union.

Expected to reach $1.5 billion in new agri-food exports, the deal has fallen short of those targets since being implemented in 2017.

In a September 21st letter to Prime Minister Justin Trudeau, five former premiers wrote the deal has “failed to deliver on its promises for Canada’s agri-food exporters.”

“This outcome results from the EU Commission and EU member states continuing to impose a wide range of trade barriers for pork, beef, canola, sugar and grains, or failing to reduce those that were to be lowered or eliminated altogether through CETA,” reads the letter penned by former Saskatchewan premier Brad Wall and others.

During her virtual appearance at Politico’s Agriculture and Food Summit on September 25, Bibeau emphasized Canada’s commitment to advocating for rules and science-based trading with its partners, including the EU.

During her appearance at the Politico event, Bibeau highlighted Canada’s work to reform the World Trade Organization (WTO), saying it’s important that the international body “is strong and functioning well.”

She didn’t close the door on including agricultural subsidies as part of the discussions to succeed in that reform. Developing countries, particularly some in South America, have contended subsidies offered by the EU, the United States, Canada and other create an unfair global agri-food trading environment.

(Source: The Western Producer)