candis, Author at Carson International

August 10, 2020

Montreal Longshore Workers Shutting Down the Port With Strike Action

Montreal longshore workers will begin an indefinite strike today, escalating their dispute with employers after two recent four-day strikes that prompted container lines to divert ships from the port.

This indefinite work stoppage will result in the suspension of berthage services normally provided by longshore workers and the handling of goods in the port’s terminals.

Not affected by this situation are liquid bulk handling, the Oceanex service (Bickerdike Terminal) and the grain terminal (Viterra).

The Montreal Port Authority invites clients to contact or consult the websites of operators such as Termont (Viau and Maisonneuve) and MGTP (Cast and Racine) to learn the latest on the situation.

Dockworkers affiliated with the Canadian Union of Public Employees have been joined in their strike actions that will stretch into a third week by the checkers union, an affiliate of the International Longshoremen’s Association. Both ILA Local 1657 and CUPE workers are ending their current strike action Friday morning.

The dispute between port workers and employers centers on the latter wanting more vacation days, equating to higher pay. CUPE is protesting working conditions requiring them to be available 19 of every 21 days. The port longshore workers, who number approximately 1,125, also want greater control of their hiring and how many workers are deployed to work a vessel.

Longshore workers have been without a contract since the end of December 2018, and there have been some 65 sessions of talks to forge a new contract.

Last week, five local employers groups expressed their concern over the economic impact the labour crisis could have on Montreal, and urged the federal and provincial governments to intervene quickly to reduce the fallout a prolonged conflict would inflict.

For any questions about how this may impact your shipments, please reach out to transportation@carson.ca.

(Source: Montreal Gazette)

August 7, 2020

Canada to Impose $3.6B in Tariffs in Response to U.S. Move Against Canadian Aluminum

The federal government will spend the next month consulting with Canadians about which U.S. metals products to target with retaliatory tariffs as a new trade dispute flares up, Deputy Prime Minister Chrystia Freeland said Friday.

The government intends to impose $3.6 billion in punitive counter-measures after spending 30 days consulting with business leaders and other Canadians about potential targets from a preliminary list.

Click here to view the preliminary list

“Canada will respond swiftly and strongly,” Freeland told a news conference.

She made the announcement a day after U.S. President Donald Trump re-imposed tariffs of 10 per cent on certain aluminum products, ending a recent period of calm on the U.S.-Canada trade front.

The products being targeted by the U.S. are used as raw materials in other aluminum-based goods, and comprised slightly more than half of Canadian aluminum exports to the U.S. over the past year.

Freeland said Canada would seek to avoid escalating the dispute. She said the retaliation would be reciprocal and limited in scope.

To submit comments and general inquiries regarding potential targets, Canadians are invited to contact fin.tariff-tarif.fin@canada.ca.

Click here to view the full notice of intent

For guidance on aluminum tariffs, please reach out:

Get in touch

(Source: CBC News)

August 7, 2020

Canada to Impose Retaliatory Tariffs After U.S. Slaps 10% Tariff on Aluminum

Ottawa will impose retaliatory tariffs on U.S. goods in response to President Trump’s decision to restore a 10 per cent tariff on Canadian aluminum imports.

Prime Minister Justin Trudeau and Deputy Prime Minister Chrystia Freeland announced the measures Thursday evening hours after Trump said he would impose the tariffs during a campaign speech at a Whirlpool factory in Ohio, citing national security concerns.

Freeland, in a statement, said Canada “intends to swiftly impose dollar-for-dollar countermeasures” in response.

“Canadian aluminum does not undermine U.S. national security. Canadian aluminum strengthens U.S. national security and has done so for decades through unparalleled co-operation between our two countries,” she said.

Trudeau said, “We will always stand up for our aluminum workers. We did so in 2018, and we will stand up for them again now.”

The United States slapped import tariffs on Canadian steel and aluminum in 2018, before removing them last year as part of a broad free trade deal now in force.

The new U.S. tariff will be in effect as of August 16.

American business groups largely oppose Trump’s plan, since it will raise costs of the metal for U.S. manufacturers, who will have little option but to pay the tariff and import the metal anyway because the U.S. does not produce enough of the metal to satisfy domestic demand.

Canada supplied about three-quarters of all the aluminum imported into the U.S. between January and May of 2020, said the executive order implementing the tariff on “non-alloyed unwrought aluminum.”

“The administration’s move to reimpose tariffs on aluminum from Canada is a step in the wrong direction,” said Myron Brilliant, head of international affairs for business lobby group U.S. Chamber of Commerce.

“These tariffs will raise costs for American manufacturers, are opposed by most U.S. aluminum producers and will draw retaliation against U.S. exports.”

The president of the industry association that represents U.S. aluminum producers said he is disappointed that Trump did not listen to domestic producers, who have been lobbying against imposing the Section 232 tariffs.

“After years of complex negotiations and hard work by government, industry and other leaders across North America to make the U.S.-Mexico-Canada Agreement a reality, this ill-advised action by a key trading partner undermines the deal’s benefits at a time when U.S. businesses and consumers can least afford it,” said Tom Dobbins, president and CEO of the Aluminum Association.

For guidance on aluminum tariffs, please reach out:

Get In Touch

(Source: CBC News)

August 6, 2020

E-Commerce Demand Stretching Freight Capacity Across Supply Chain

Increased e-commerce volumes are stretching U.S. freight capacity, exacerbating the divide between the largest and smallest shippers.

The cargo of giants including Amazon, Walmart, Target, along with many small and medium-sized e-tailers is soaking up capacity in the truckload and less-than-truckload (LTL) markets, and fueling a surge of Asia imports. With air cargo rates out of China up at least 25 percent from a year ago, according to the TAC Index, emergency shipping to avoid stockouts is even more critical.

The flood of orders for items purchased online rides atop a wave of inventory replenishment further stretching capacity limits. And when space gets tight, it’s the smaller e-retailers that get squeezed. In a July 30 second-quarter earnings call, UPS signaled to small parcel shippers to prepare for higher rates and surcharges as it looks to align pricing with the value it believes it provides.

Equally concerning for shippers are potential delays as planning for peak holiday season revs up and available carrier capacity gets snapped up. Shippers reported delays and volume caps during April, May, and June as FedEx and UPS struggled to meet service commitments. Shippers that do not score enough capacity will end up paying more for shipping and run the risk of delivery delays.

And while the sharp increase in e-commerce volumes may never be seen again due to COVID-19 exacerbating the swing, the surge raises questions on how the freight shipping industry will adapt to goods ordered online making up a much larger slice of total shipments.

(Source: JOC.com)

August 5, 2020

WTO Sees Global Trade Down 13% in 2020 Due to COVID-19

The World Trade Organization forecast global trade to fall 13% this year due to COVID-19 shocks, outgoing chief Robert Azevedo said this week. This is reportedly significantly less than the WTO’s most pessimistic scenario of a 32% slump.

Speaking in an online event hosted by ICC Brasil and the Brazilian Confederation of Industry, Roberto Azevedo said there is growing concern within the WTO about countries moving toward self-sufficiency as a response to the pandemic.

Concentrating production in a country exposes it to a wide range of shocks, Azevedo said. Nations should diversify sources of supply, and the COVID-19 pandemic will see global value chains reconfigured in the coming years, he added.

The WTO has struggled to rein in global tensions and coordinate responses to the COVID-19 pandemic.

(Source: National Post)

August 4, 2020

CBSA Updates Trade Compliance Verification Priorities

The Canada Border Services Agency recently published an amended list of its current compliance verification priorities as of July 2020, to update the status of various goods under ongoing review and include several new additions.

Additions to the list of the CBSA’s compliance verification priorities include:

Spent Fowl, Headings 02.07, 16.01 and 16.02
LED Lamps, Heading 85.39
Batteries, Heading 85.06
Parts of Lamps, Heading 94.05
Other Mountings & Fittings, Suitable for Furniture, Heading 83.02

To view a complete list of all CBSA’s current and ongoing compliance verification priorities, click here.

If you have any questions about CBSA’s current and ongoing compliant verification priorities, please reach out:

Matt Earish — matt@carson.ca
Tyler Carson — tyler@carson.ca

July 31, 2020

Canada Changes Export Policy Toward Hong Kong After Passage of Security Law

Canada has taken steps in response to the passage of Hong Kong’s Security Law. Exports and transfers of sensitive goods and technology to Hong Kong will now be treated in the same manner as those destined for mainland China. Exports of sensitive military items to Hong Kong will be prohibited.

Under the new policy, all export permit applications for items listed on the Export Control List destined for Hong Kong will be “closely scrutinized”, and permits for exports or technology transfers inconsistent with Canada’s domestic and international legal obligations, foreign policy, or security interests will be denied. Canada currently maintains export controls over a broad range of dual-use goods and technology, including those relating to cybersecurity, information security (encryption), telecommunications, integrated circuits, computers, navigation, avionics, sensors, aerospace and nuclear items, as well as defence and weapons-related items.

The Notice indicates that permits for exports of “sensitive” military items will be denied, but provides no definition for the term “sensitive.” This oversight will likely be addressed by observing the implementation and administration of this policy by Global Affairs.

Hong Kong’s Security Law, which came into effect July 1, 2020, has sparked global controversy. It is widely perceived as a mechanism to suppress Hong Kong’s independence, and human rights activism, by breaking the constitutional arrangement, commonly known as the “one country, two systems” agreement, that made Hong Kong a semi-independent Special Administrative Region of China in July of 1997.

Click here to read the full notice issued by Global Affairs Canada.

For questions about exports to Hong Kong, please reach out:

Matt Earish — matt@carson.ca
Tyler Carson — tyler@carson.ca

July 30, 2020

Canada Agrees to Tax Homegrown Wine in Trade Settlement

B.C.’s wine industry is hoping the Trudeau government can find a solution after Canada agreed to reimpose a federal excise duty on domestic bottles as part of a trade dispute settlement.

The British Columbia Wine Institute (BCWI) estimates that the cost of a case of Canadian wine would rise by about $6, if a new provision in Canada’s trade truce with Australia announced Monday comes to pass, following a two-year grace period.

“That’s pretty material to Canadian wine growers and farmers, and so we’re unhappy about that,” said president and CEO Miles Prodan. “We’re in discussions with the feds as well, how can they help us with that.”

International Trade Minister Mary Ng announced on Monday that Canada had reached a “partial agreement” with Australia over its World Trade Organization challenge against Canada’s treatment of imported wines.

As part of the agreement, Canada agreed to repeal a 15-year-old exemption to the federal excise duty that it had been giving to wine produced in Canada and made from entirely Canadian products.

The change is expected to occur by June 30, 2022, according to Ng’s announcement.

Australia’s dispute was launched in January 2018, and includes other concerns, some of which were addressed on Monday that pertain to policies and regulations in Ontario and Nova Scotia.

But the removal of the excise exemption for Canadian wine affects the industry nationwide, Prodan said, not just the $2.8-billion industry in British Columbia.

While he said he was satisfied that the situation was being resolved through a negotiated settlement, as opposed to a WTO ruling, he said it will be a shock to many younger wineries.

In 2006, the former Harper government, newly elected to power, brought in the exemption for wine made from 100 per cent Canadian-grown products in Budget 2006, meant to give domestic winemakers a competitive edge.

In a statement issued Monday, Wine Growers Canada, the national industry association, said the excise exemption had “supported investment in more than 400 new wineries and 300 winery modernizations” over the 2006-18 period.

Australia’s B.C.-specific concerns had already been addressed, said Prodan, through other trade talks related to the United States-Mexico-Canada Agreement (USMCA).

USMCA, which is the replacement for NAFTA, included a “side letter” where B.C. had agreed to stop restricting the wine sold on its grocery store shelves to provincial wine only, as of last November.

That policy, which had been brought in by the B.C. Liberals in 2015, forced international wines into “stores-within-a-store.” Monday’s agreement addresses similar issues.

Ontario, for example, agreed to eliminate the tax difference between provincial and non-provincial wine sold at wine boutiques.

“The agreement reflects Canada’s strong commitment to the rules-based international trading system, which is incredibly important for our businesses during these challenging times,” said Global Affairs departmental spokesperson Ryan Nearing.

(Source: National Observer)

July 28, 2020

North America Container Imports From Europe Slow As Capacity Tightens

Container freight rates from Europe to North America have fallen 15 percent in the past five weeks as carriers struggle to match capacity to the lower volume being booked by cautious shippers, according to forwarders on the trade.

The spot rate from Rotterdam to New York on July 23 was $2,213 per FEU, down $364 per FEU from mid-June and 7 percent year over year, after reaching a 2020 high of $2,592 per FEU on May 14, according to Drewry’s World Container Index (WCI). Last year, the WCI westbound trans-Atlantic rate never exceeded $2,400 per FEU.

The trans-Atlantic trade is dominated by automotive goods, parts, and machinery, especially on the westbound headhaul routes, with the “peak season” traditionally beginning at the end of July. However, lockdowns aimed at slowing the spread of COVID-19 in the second quarter and rising infection rates across the US have deeply impacted US demand for imports from Europe.

“The peak is definitely not coming, and we are hoping for a rush before Christmas, but our customers are being very cautious,” said Helge Neumann-Lezius, the Europe, Middle East, and Africa vice president of product and capacity management for DHL Global Forwarding.

“All production in Europe is at a low level at the moment, so volumes that are usually strong during the year are still down,” Neumann-Lezius explained. “We are seeing some shippers have orders to replenish existing products, but new orders and new production is still limited. We are expecting to run with a low-volume second half of the year.”

The trans-Atlantic operations manager for a Germany-based forwarder, who asked not to be identified, said shipment volume and shipment sizes were both shrinking, with a significant increase in demand for consolidation of cargo into less-than-container-loads (LCL).

“Customers are starting to come back after the coronavirus, but only with small orders. We are seeing 10 percent fewer orders but 50 percent less volume. For instance, before COVID-19 on one of our busiest routes from Europe to the US East Coast, we regularly had 200 consignments consolidated in 18 FEU per week. Last week, we had 180 consignments that only loaded nine containers.”

The forwarders also did not report an increase in front-loading to move cargo ahead of potential new US tariffs on a range of European-made goods. The US Trade Representative has just completed a call for public comment on new tariffs on $3.1 billion of goods from the UK, France, Germany, and Spain.

(Source: JOC.com)

July 27, 2020

Government of Canada Announces Creation of Essential Services Contingency Reserve Through Safe Restart Agreement

To ensure that essential service organizations have access to key supplies needed to keep members safe throughout the COVID-19 pandemic, last week the Honourable Anita Anand, Minister of Public Services and Procurement, announced that, as part of the Safe Restart Agreement, the Government of Canada is establishing the Essential Services Contingency Reserve, to which essential service organizations can apply for temporary, urgent access to personal protective equipment (PPE) and other critical supplies.

The Contingency Reserve complements existing PPE support being provided to frontline health care workers by the Public Health Agency of Canada. It helps other essential service organizations bridge urgent, short-term gaps in their supplies to avoid any significant disruptions in services to Canadians. This includes all critical infrastructure sectors, including the food sector.

Starting August 3rd, the ESCR will be accepting applications for PPE and will assist essential services providers, outside the health sector, that urgently require PPE to obtain supplies and continue operations. PPE including N95 and KN95 respirators, surgical masks, and gloves will be available.

Industry associations are encouraged to apply on behalf of their respective sectors.

Eligible associations and organizations will be able to apply online for a range of equipment, available for purchase at cost. Support provided to provincial or territorial governments will not be cost recovered. Full details on the Contingency Reserve, including the application process and eligibility criteria, are available on the Essential Services Contingency Reserve web page.