June 30, 2021

Entry Into Force of Sewing Thread Requirement for Apparel Goods

Effective July 1, 2021, apparel goods of Chapter 61 or 62 containing sewing thread of heading 52.04, 54.01 or 55.08, or yarn of heading 54.02 used as sewing thread shall be considered originating only if such sewing thread is both formed and finished in the territory of one or more of the Parties.

Sewing thread is considered formed and finished in the territory of one or more Parties if all production processes and finishing operations, starting with the extrusion of filaments, strips, film or sheet, and including slitting a film or sheet into strip, or the spinning of all fibres into yarn, or both, and ending with the finished single or plied thread ready for use for sewing without further processing, took place in the territories of one or more of the Parties, even if non-originating fibre is used in the production of sewing thread of headings 52.04, 54.01 or 55.08, or yarn of heading 54.02 used as sewing thread.

Goods of Chapter 61 or 62 that are produced in Canada using non-originating sewing thread may nonetheless be eligible for duty-free treatment when imported into the United States or Mexico under the CUSMA Tariff Preference Levels (TPLs), regardless of the origin of the yarn or fabric used.

The CUSMA TPLs provide duty-free access for specified quantities of yarns, fabrics, apparel and made-up textile goods that do not meet the applicable rules of origin. Imports into the U.S. under TPLs are also exempt from U.S. merchandise processing fees.

For more information on CUSMA TPLs for textiles and apparel, please visit Global Affairs Canada’s textiles and clothing page.

More information on the sewing thread requirements is set out in Note 3 of Chapter 61 and Note 4 of Chapter 62 in Annex 4-B of the CUSMA and in subsection 2(b) of Schedule 1 of the CUSMA Rules of Origin Regulations (CUSMA Rules of Origin Regulations.) 

June 30, 2021

Navigating Supply Chain Constraints and Trucking Rates

The capacity issue that has been looming over the trucking market for months is showing no signs of being resolved in any way for the remainder of the year. Strong demand has resulted in rates continuing to rise month over month across van, flatbed and reefer.

The ability for carriers to add capacity is limited by parts shortages that are holding back truck, trailer and chassis production, with the demand for trucking volume expected to continue moving forward as retail sales remain high and retailer inventories remain low. But analysts also see demand outside of retail.

“While not as large as retail in terms of overall freight generation, capital goods spending is freight intensive, and the coming capex boom will certainly benefit freight demand in the next few quarters,” says ACT Research’s Vice President and Senior Analyst, Tim Denoyer.

Carson 3PL Ground Transport Services

Carson is now offering FTL, LTL Ground Transport anywhere in North America. Whether moving in a van, flat deck, step deck, we have you covered.

Employee Spotlight: Marty Sarmiento

Marty joined the Carson Freight Team in October 2020 and brought with him over 15+ years of North American Ground Transport experience. He is familiar with all aspects of ground transport, from a simple pallet, to oversized cargo moving on decks that require permits and pilot cars.Although Carson has always offered Ground Transport, with Marty onboard we have been able to expand our offerings, providing clients with competitive pricing and expert customer service.

Whether you are moving freight within Canada, or importing or exporting cross border with the US, we encourage you to reach out to Marty and our ground team at ground@carson.ca to learn more about how our team can provide options to keep your domestic supply chain running smoothly.

June 28, 2021

Webinar: Countervailing & Antidumping Duties: Canada’s Trade Protectionism Tools

Carson International is pleased to partner with Miller Thomson LLP for another instalment in our webinar series addressing Canada/U.S. cross-border trade developments and updates.

The CBSA recently made preliminary determinations under subsection 38(1) of the Special Import Measures Act (Canada) (“SIMA”), that China and Vietnam had been dumping and subsidizing upholstered domestic seating (“UDS”) entering the Canadian market. We will review the specifics of this case and also provide links to all the present SIMA Actions presently in force.

This webinar will discuss the recent action taken by the CBSA as well as the CBSA’s administration of SIMA. In general, the SIMA investigative process takes about 260 days from the time the CBSA receives a complaint until the Canadian International Trade Tribunal (CITT) makes a finding. This webinar will detail the steps that will be taken during this investigative process to determine whether countervailing and/or antidumping duties should be applied.

Join the conversation regarding SIMA in order to optimize duty and tax minimization strategies and reduce customs valuation regulatory risk.

Panelists:

Dave Pentland, Carson International
Dan Kiselbach, Miller Thomson LLP

Webinar Details:

Thursday, July 15, 2021
Time: 11:00 a.m. – 12:00 p.m. PST

Webinar connection details will be provided by Miller Thomson before the webinar.

R.S.V.P. by July 14, 2021 at 4:00 p.m. PST.

Register Today
June 23, 2021

Canada’s Inflation Rate Rises to Highest Level in a Decade

Canada’s inflation rate increased to 3.6% in May, the fastest pace in a decade, Statistics Canada says.

The data agency said in a news release Wednesday that the cost of just about everything is going up at a much faster pace than usual, from shelter and vehicles, to food, energy and consumer goods.

The cost of shelter increased by 4.2% in the year up to May, the fastest rise in the cost of putting a roof over one’s head since 2008. And the cost of filling a home with furniture and appliances also went up, by 4.4%. That’s the fastest pace of an increase for so-called durable goods since 1989.

Furniture prices in particular rose by 9.8% in the past year, their biggest jump since 1982. Last month the government slapped tariffs of up to 300 per cent on some types of upholstered furniture from China and Vietnam.

Gasoline prices have risen by 43% in the past year, a figure that looks especially high because it’s being compared to May of last year, when demand and prices for gasoline cratered. But even on a monthly basis, the cost of gasoline went up in May by 3.2% compared to April’s level.

Gas isn’t the only part of driving that’s getting more expensive either, as the price of new cars increased by 5% in the past year. That’s the biggest jump in vehicle prices since 2016, and the biggest reason for it is an ongoing shortage of semiconductors, a global trend that has jacked up the price of anything that uses microchips.

And the price of traveller accommodation rose by 6.7%. That’s the highest rate seen since the pandemic began and demand for hotel stays plummeted.

Canada’s economy is, indeed, starting to kick into high gear after stalling out during COVID-19.

Economist Avery Shenfeld with CIBC says that while the annual price increases are eye-popping, it’s important to remember that May’s numbers are being compared to the situation in May 2020, when just about every facet of the economy was in the doldrums.

“Prices look elevated compared to where they were a year ago, but that’s because prices a year ago were rock-bottom levels … in the throes of the first wave of COVID,” he said in an interview with CBC News. “We really haven’t had that much inflation if you measured prices relative to where they were in the spring of 2019.”

(Source: CBC News)

June 23, 2021

Canada to Reopen Border in Phases

Prime Minister Justin Trudeau’s government is ending mandatory hotel quarantines for vaccinated Canadian residents arriving by air.

Health Minister Patty Hajdu announced that Canadian citizens, permanent residents and essential workers who are fully vaccinated will no longer have to spend three days isolating in a government-approved hotel. Instead, they’ll be permitted to quarantine at home while they wait for the results of a test on arrival.

The exemption won’t apply to tourists or foreign business travellers that aren’t essential workers, and they will still need to complete a hotel quarantine if arriving by plane. The government plans to roll out the measures by the first week of July, the health minister said Wednesday.

The change comes as pressure grows for Trudeau to ease COVID restrictions for fully vaccinated travellers in time for the summer season, especially along the U.S.-Canada border. The two countries have created a working group to determine how to reopen the border safely after beginning discussions on the issue earlier this spring.

To qualify for the exemption, a person must be inoculated with one of the four vaccines approved in Canada: Pfizer Inc.-BioNTech SE, Moderna Inc., AstraZeneca Plc-Oxford University or Johnson & Johnson. Radio-Canada was the first to report the policy shift.

The easing of the hotel rule is part of the first phase of the government’s multistage plan to open the border, Hajdu said alongside Intergovernmental Affairs Minister Dominic Leblanc. Further restrictions will be lifted once more Canadians are vaccinated.

Canada closed its borders to non-essential travel in March 2020 to stop the spread of Covid-19.

(Source: Financial Post)

June 21, 2021

Canadian Softwood Lumber Industry Wants U.S. Refunds

Canada’s softwood lumber industry wants the Biden administration to refund billions of dollars that companies have paid since 2017 to cover anti-dumping and countervailing duties.

British Columbia Lumber Trade Council President Susan Yurkovichshe contends that the tariffs were unwarranted and should never have been imposed.

Any reimbursement would likely come as part of a broader agreement on softwood lumber between the U.S. and Canada. Canada has repeatedly asked the U.S. to come to the negotiating table — most recently during a G-7 summit confab between Canadian Prime Minister Justin Trudeau and Biden.

“The United States is open to resolving our differences with Canada over softwood lumber, but it would require addressing Canadian policies that create an uneven playing field for the U.S. industry,” says Adam Hodge, a spokesperson for the U.S. trade representative. “Unfortunately, to date, Canada has not been willing to adequately address these concerns.”

Lumber is not the only point of contention. Ottawa has also requested a dispute settlement panel under the United States-Mexico-Canada Agreement to address the 18% tariff the U.S. has in place on the country’s solar products.

The tariffs, introduced in the twilight of former President Donald Trump’s term in office, have so far been maintained by the Biden administration. “These tariffs are unwarranted and damaging to the global competitiveness of our long-established, secure, and deeply integrated supply chains,” Canadian Trade Minister Mary Ng said in a statement.

(Source: Politico)

June 21, 2021

Container Shipping To See Extended Peak Season

Container shipping is expected to see an extended peak season this year, with no signs of a slowdown in demand, believes Hapag-Lloyd CEO Rolf Habben Jansen, warning that if demand picked up in the traditional third-quarter peak season it would extend beyond the traditional Golden Week slowdown. 

“People will start to ship early and it will probably last longer than usual,” he said, noting that demand was still strong, and unlikely to change soon. “Inventories are low, which is why people are eager to get stuff shipped; but even once we are beyond the pandemic, it’s not unlikely that people will want more inventory.”

He expects demand “will stay robust for an extended period of time”, exacerbating the current delays in the supply chain. “The theme remains congestion,” he notes. “The US is improving a little bit, but there are still ships waiting and we have not made the progress we wanted to in the second quarter. We need to have a not too strong peak season there to get out of the difficulties, which is not what we foresee at the moment.”

On top of the current demand was a “backlog of growth” from the decline in volumes shipped in the past year that still needed to catch up.

(Source: Lloyd’s Loading List)

June 16, 2021

How Bad are Global Shipping Snafus? Home Depot Has Contracted Its Own Container Ship As Safeguard

Home Depot is one of the largest importers in the country. Yet with congested ports, container shortages and Covid-19 outbreaks slowing shipments, the company made a decision: It was time to get its own boat.

“We have a ship that’s solely going to be ours and it’s just going to go back and forth with 100% dedicated to Home Depot,” President and Chief Operating Officer Ted Decker said in an interview. It marks the first time that the company has taken such a step.

Decker said the contracted ship, which will begin running next month, is just one example of the unusual measures that the company is taking as it copes with challenges that have ricocheted across the global supply chain.

Other retailers have also had to go to great lengths to try to stock stores and distribution centers and keep up with consumer demand as the economy recovers from the pandemic. For shoppers, retailers’ logistical woes are playing out in the form of out-of-stocks, long delays before a purchase’s arrival and higher prices.

(Read full article via CNBC)

June 16, 2021

Port of Los Angeles Surpasses 1 Million Container Units in Single Month

The Port of Los Angeles processed 1,012,248 Twenty-Foot Equivalent Units (TEUs) in May, a leap of 74% compared to last year. It was the busiest month ever in the Port’s 114-year history, the 10th consecutive month of year-over-year increases and the first time a Western Hemisphere port has handled more than 1 million TEUs in a month.

“The historic level of cargo that we’re managing reflects our commitment to reach new heights by working with our partners to further enhance our productivity, throughput and velocity,” said Port of Los Angeles Executive Director Gene Seroka. “Much credit goes to our longshore workforce, truckers, terminal operators, ocean carriers, railroads and other stakeholders for scaling up to meet this extraordinary demand.”

Last week, the Port of Los Angeles set another Western Hemisphere record, processing more than 10 million TEUs in a 12-month period that will end June 30th.

(Source: Port of Los Angeles)

June 14, 2021

Container Rates Continue to Skyrocket

The sharp upward increase in container freight rates appears to have no end in sight, much to the alarm of shippers.

Delays, congestion and container availability problems are increasing at ports and terminals, largely due to the continued impacts of COVID-19.

While premium charges on top of spot rates are now so high that index rates are no longer able to capture the true cost of ocean shipping, here are approximate rate jumps for the following regions:

Asia-East Coast

The Freightos Baltic Daily Index for Asia-East Coast surged by around 20% in just the past few days. As of June 10, the Freightos rate reached $9,317 per FEU, its highest point ever and up 224% year on year (y/y).

The Drewry weekly assessment for the Shanghai-New York route was $8,251 per FEU, up 9% week on week (w/w) and 203% y/y.

S&P Global Platts provides daily assessments of Freight All Kinds (FAK) rates. Its North Asia-East Coast FAK assessment, as of Thursday, was $6,800 per FEU, up 152% y/y.

Asia-West Coast

Freightos put Thursday’s Asia-West Coast spot rate at a record-high $6,341 per FEU, up 194% y/y. Drewry’s weekly Shanghai-Los Angeles index is at $6,313 per FEU, up 6% w/w and 199% y/y.

S&P Global Platts’ North Asia-West Coast North America FAK rate was $4,200 per FEU on Thursday, almost triple the FAK rate a year ago.

Asia-East Coast

Asia-East Coast rates have been rising faster than Asia-West Coast rates, according to Freightos’ data.

Freightos’ East Coast-West Coast spread — the premium importers pay to take the long route via the Panama Canal — hit $2,976 per FEU on Thursday, a record high. It has spiked in recent days.

Trans-Atlantic Westbound

Freightos’ Europe-East Coast assessment for Thursday was $5,193 per FEU, a new record and up 164% y/y. 

Underscoring how different indexes come up with different figures, Drewry’s number is much lower than Freightos’. Drewry put Rotterdam-New York rates at $3,988 per FEU, up 66% y/y.

Trans-Pacific

Rates for U.S. exports out of the West Coast to Asia have also jumped, albeit off a far lower base. Freightos assessed rates on this route at $1,208 per FEU on Thursday, up 154% y/y.

Drewry’s weekly rate is lower: $808 per FEU, up 61% y/y.

(Source: American Shipper)