Gemini Shippers Group was chosen to receive the Global Logistics Award for the 2016 World Trade Week NYC. World Trade Week NYC is part of an annual nationwide celebration of international trade observed by business and trade-related organizations across the United States during May. The mission of World Trade Week NYC is to promote the importance of international trade to the New York metropolitan area economy. New Yorkers depend heavily on international commerce for their jobs, standard of living, and the myriad goods and services available to its diverse population. The Global Logistics award is presented to an organization company in the New York metropolitan region for leadership in using logistics to advance business globally. During the awards ceremony held at WTW NYC International Award’s Breakfast, Gemini Shippers Group CEO Sara Mayes commented, “ we are honored to receive this award and the recognition of the work we do on behalf of our over 250 member companies to aid them in optimizing their international transportation. On behalf of our management team, I would like to thank the New York District Export Council Co-Chairs, Chuck Ludmer, Principal, Chief Marketing and Practice Development Officer, Cohn Reznik, and Molly Campbell, Port Director, The Port Authority of NY & NJ, our member companies and our dedicated team at Gemini Shippers”.
Category Archives: Gemini News
Sara Mayes, President and CEO Gemini Shippers Group
Often companies measure the effectiveness of their supply chain with a focus on the need to increase velocity while reducing costs. While cost control and speed are important features of great supply chains, a supply chain that offers a true competitive advantage has to be designed to allow the firm to deal with the known and unknown disruptions we face every day.
Today, importers face a host of challenges; uncertain and fickle consumer demand, the threat of supply disruption in both their raw material and ocean transportation, SOLAS weight requirements, the effects of e-commerce and Omni-channel shoppers, a tepid economy and a looming US presidential election.
Challenges like these require Supply Chain managers to build a supply chain nimble enough to deal with change and resilient enough to overcome disruption.
In 2004, Stanford Professor Hau L. Lee wrote an article in the Harvard Business Review, The Triple-A Supply Chain, where he outlined that a focus on efficient and cost effective supply chains alone did not lead companies to a sustainable competitive advantage over their rivals. Based on Professor Lee’s research, companies that had achieved a true competitive advantage in their supply chain displayed three distinct qualities; Agility, Adaptability, and Alignment.
An agile supply chain is designed to deal with changes in supply and demand efficiently and to respond to external disruptions seamlessly. Picking dependable logistics partners, sharing information among your partners and having a strong forecasting and inventory management system in place are all attributes of an agile supply chain.
Adaptable supply chains are able to adjust to shifting structural trends in the market. Most recently, the effect of growing e-commerce and Omni channel shoppers, the passing of the TPP agreement and the enlarging of the Panama Canal are all examples of changing market dynamics that should be incorporated into supply chain planning. Companies can increase their adaptability by creating a formal monitoring system for changes that will affect their supply chain and creating active listening and feedback loop for input from both their customers and suppliers.
Successful supply chains align the goals and incentives of the firm with their vendors. Importers should provide their partners with clear goals, increased visibility and information and an equitable share of risk and reward to ensure all parties are working together on towards the mutual goal.
While the focus on cost and speed is important as ever, professor Lee’s Triple-A supply chain reminds us that speed and cost control is not enough in today’s disruptive environment.
Hapag-Lloyd AG (HL) and United Arab Shipping Company SAG (UASC) are currently discussing forms of cooperation including a potential combination of their mutual container shipping operations. In case of a business combination, the parties are basing their discussions on a relative valuation of the two businesses at 72% (HL) and 28% (UASC), subject to a mutually satisfactory completion of the negotiations and the mutual due diligence exercise. To date, the discussions conducted between the two carriers have not resulted in any binding agreement and no assurance can be given that these discussions will lead to a definitive agreement.
The South Carolina Ports Authority is able to offer clients powerful tax credits for increasing volume via South Carolina port facilities and/or making certain port-dependent capital investments. Below is a brief summary of these incentives.
VOLUME INCREASE INCENTIVE:
To qualify for the incentive, the client must have employees in South Carolina and be paying payroll withholding taxes or corporate income tax.
After the establishment of a base year of volume, the client could receive up to $200 per FEU or $100 per TEU based on incremental growth. Provisions are in place for non-container clients.
The company can apply for the payroll tax credit any year it grows its volume by at least five percent (5%) via a South Carolina Port.
The origin/destination of the cargo is not a determining factor.
The tax credit is delivered as cash refund from the SC Department of Revenue to be used however the client sees fit.
If the refund exceeds the company’s payroll tax liability for the taxable year, the excess amount may be carried forward and claimed against withholding taxes or corporate income taxes over the next five succeeding taxable years.
The client is required to track and report their own volumes.
VOLUME INCENTIVE EXAMPLE:
Client A has several Southeast U.S. facilities including a manufacturing & distribution operation in South Carolina that employs 200 workers. In Year 1 the client moved 10,000 FEU, of which 1,000 FEU moved via the Port of Charleston.
Client A establishes Year 1 as its base Port of Charleston volume.
In Year 2, the client increases its volume via the Port of Charleston from 1,000 to 5,000 FEU. Some of that volume was delivered to the South Carolina facility, but not all of it.
After documenting Year 2 volume via the Port of Charleston, Client A may apply for and receive a payment from the State of South Carolina for up to $800,000 (4,000 FEU increase X $200/FEU = $800,000). If the amount exceeds the client’s annual payroll tax liability the excess may be carried forward to subsequent years.
Client A may apply for the credits again in Year 3 provided its volume increases by more than 5% over Year 2.
Shanghai, April 20, 2016 – CMA CGM, COSCO Container Lines, Evergreen Line and Orient Overseas Container Line today signed a Memorandum of Understanding to form a new Alliance enabling each of them to offer competitive products and comprehensive service networks covering the Asia-Europe, Asia-Mediterranean, Asia-Red Sea, Asia-Middle East, Trans-Pacific, Asia-North America East Coast, and Trans-Atlantic trades.
This is a milestone agreement among four of the world’s leading container shipping lines. Each line will offer best-in-class services to customers with fast transit times, competitive sailing frequencies, and the most extensive port coverage in the market.
“This new partnership will allow each of its members to bring significantly improved services to its respective customers,” member carriers said in a statement. “Shippers will have an attractive selection of frequent departures and direct calls to meet their supply chain needs, including access to a vast network with the largest number of sailings and port rotations connecting markets in Asia, Europe and the United States.”
“The Alliance will also bring service reliability and the most efficient integration of the latest vessels in a fleet of over 350 containerships. Initially the deployment will cover more than 40 services globally mostly connected with Asia, including about 20 services each in the U.S. and Europe related trades.”
Subject to regulatory approvals of competent authorities, the new Alliance plans to begin operations in April 2017. The initial period of the Alliance shall be five years.
Further details about the new Alliance and the transition plans from the four member lines in their current alliances will be communicated to stakeholders and the market in due course.
By Sara Mayes, CEO and President
We often receive inquiries from our member companies questioning how details of their shipments are found in the public domain. Many shippers come to this realization based on unsolicited offers for services highlighting details of past international shipments.
Many shippers are unaware that detailed information of their containerized shipments is available, including importer and/or shipper names and addresses, and description and quantity of cargo, carrier information and ports of load and discharge.
Under US federal law codified in 19 CFR 103.31(a) certain information on inward and outward vessel manifests may be examined, copied and published by accredited representatives of the press, i.e., newspapers, commercial magazines, trade journals and similar publications. Shipment data from Customs ACE system is also aggregated by numerous trade data organizations who sell the data to the public for a fee.
As surprised as shippers are to find this information in the public domain, they are often equally surprised to learn there is a way to stop this from occurring. Under 19 CFR 103.31 (d), an importer or consignee may request confidential treatment of its name and address contained in inward manifests, to include identifying marks and numbers. In addition, an importer or consignee may request confidential treatment of the name and address of the shipper or shippers to such importer or consignee.
Importers and exporters may obtain confidential treatment for certain manifest information by filing a simple letter with US Customs, outlining the trade names they wish to exempt from reporting. The process requires shippers to submit this request every two years.
It a world where data transparency is growing, it may seem futile for shippers to try and protect their data from prying eyes, but with a limited amount of effort, shippers can protect their detailed information from outside parties. If you want some help preparing a request letter, please contact Gemini Shippers Group at info@geminishippers.com, and we will walk you through the steps to complete the process.
Washington, DC – April 13, 2016 – A leading group of business associations and other organizations announced today that the fifth annual “Imports Work Week” will take place on May 9-13, 2016. Imports Work Week is an effort to draw attention to the essential role that imports play in the U.S. and global economy.
This year’s Imports Work Week takes places in the midst of Congressional debate on a series of trade measures, including the recently concluded Trans-Pacific Partnership (TPP) and ongoing negotiations for trade agreements covering transatlantic commerce, services, and environmental goods. During the week, numerous associations and think tanks are expected to take part by publishing commentaries and blog postings, along with other grassroots and social media activities.
As Roberto Azevêdo, Director-General of the World Trade Organization (WTO), has said: “Imports are a good indicator of economic health — they are a sign both of consumer demand and industrial activity. For many American companies, imports provide essential component parts for their goods, often at prices which help them to remain competitive. By supporting companies to grow and export in this way, imports are a critical component of any vibrant economy.”
A study unveiled during Imports Work Week in 2013 found that 16 million U.S. jobs depend on imports. A recent study by HSBC shows that imports save the average U.S. family $13,600 a year. A 2013 study also found that the U.S. value-added for imported apparel equals about 70 percent.
More information about Imports Work Week can be found at www.importswork.com or through Twitter at @importswork.
The Coordinating Committee for Imports Work Week includes the following:
American Apparel & Footwear Association (AAFA)
American Association of Exporters and Importers (AAEI)
Coalition for GSP
Consuming Industries Trade Action Coalition (CITAC)
Emergency Committee for American Trade (ECAT)
Fashion Accessories Shippers Association (FASA)
Footwear Distributor and Retailers of America (FDRA)
Gemini Shippers Group
International Wood Products Association (IWPA)
National Association of Foreign-Trade Zones (NAFTZ)
National Fisheries Institute
National Retail Federation (NRF)
Outdoor Industry Association (OIA)
Retail Industry Leaders Association (RILA)
Toy Industry Association (TIA)
Trans-Pacific Partnership (TPP) Apparel Coalition
Travel Goods Association (TGA)
U.S. Fashion Industry Association (USFIA)
U.S. Chamber of Commerce
U.S. Council for International Business (USCIB)
Washington Council on International Trade (WCIT)
Gemini Shippers and FDRA have launched a strategic partnership which offers FDRA members the full range of benefits of membership in Gemini Shippers Group.
Footwear importers continue to face significant challenges associated with the movement of cargo from overseas factories to the US market, driven by the underlying poor health of the ocean liner industry, and the evolving trend of industry consolidation and carrier alliance restructuring. Today, shippers face constant challenges working with their ocean carrier partners to secure the required space and price options to bring their product to market on time and within budget.
To aid FDRA members in this effort, FDRA and Gemini Shippers Group have formed an alliance. Gemini Shippers Group, one of the largest shippers associations in the United States, offers member companies access to competitive global ocean freight contracts, and long term rates and space allocations by signing global contracts with a wide variety of top tier ocean carriers.
Working with its 200 plus member companies, Gemini Shippers Group helps companies to navigate the complex world of ocean shipping procurement offering members the very competitive stable pricing of a very large BCO with the flexibility of an NVOCC. Relying on strong carrier relationships and the cumulative volumes of the member companies, Gemini is able to offer highly competitive ocean freight rates on the carrier partner of your choice, without an MQC commitment. Shippers can mitigate their contracting risk working through Gemini’s year long, staggered expiration, fixed rate contracts and a host of benefits including:
- No Fee to Join
- No MQC volume commitment
- Over 15 carrier partners to choose from
- Unlike an NVOCC, shipments move on the carriers Bill of Lading for visibility at origin and destination, maintaining complete control and visibility of their carriers and shipments
- Direct carrier sales representation
- Representation in China to assist origin offices and forwarders
- Forwarder and Broker neutral
- Access to Gemini IT portal with track and trace, rate database and analytics dashboard
- All Bills of Lading are audited for rate accuracy
- We advocate on behalf of the member, and consult on all aspects of their logistics needs
Gemini Shippers Group is excited to enter into this strategic partnership with the FDRA and to work with its members on their shipping and transportation needs. To find out more about joining Gemini Shippers Group, FDRA members are asked to contact: Nicole Uchrin, Managing Director, nuchrin@geminishippers.com / 646-741-1962
For more information on Gemini Shippers Group please visit our website www.geminishippers.com
By Sara Mayes, President / CEO Gemini Shippers Group
Last week shippers and carriers came together at two of the industry’s iconic events to discuss a range of issues impacting the supply chain today.
The 16th annual Transpacific Maritime Conference was held in Long Beach. Over two and a half days, carriers and shippers discussed a range of issues affecting the Transpacific trade, supply and demand and operational issues affecting carriers and shippers alike. Concurrently, in Dallas, the Retail Industry Leaders Association (RILA) met for their 2016 Retail Supply Chain Conference. While each conference had its own distinct focus, a number of common themes which highlighted the risks and opportunities shippers and carriers face, were prevalent in both venues.
Demand and Growth: Expectations for trade growth in 2016 remain muted. A host of noted economists parsed the global economy along various lines, but a key theme emerged that demand in 2016 will remain modest and in the low single digit range. For carriers, this lack of demand likely means that the current overcapacity, and downward corollary pressure on rates, will continue. For shippers, the need to maximize sales to an increasingly nimble and fickle shopper continues unabated.
Disruption: A number of panels at TPM continued to voice concern over ongoing disruption in the liner shipping space brought on by a host of changes including; global alliances, carrier M&A, port congestion, labor disruption, chassis provisioning, SOLAS weight rules, and the upcoming opening of the enlarged locks at the Panama Canal. The takeaway from all stakeholders was that shippers’ supply chains must remain flexible to deal with this ever changing landscape.
Omni-Channel Shoppers: Both conferences highlighted the changes being felt in the supply chain due to the increase in E-Commerce and the effect that Omni-Channel shopping has on the supply chain. For retailers, the added complexity of multi-channel inventory management, Buy Online – Pick Up In Store, same day delivery and the on demand economy continues to present challenges for network design and inventory management.
Technology: Both conferences highlighted the continued need for all parties in the supply chain to adapt new technologies to improve performance. Numerous speakers noted the transformation of a new digital supply chain network driven by analytics and visualization. Enabled by big data technologies, interconnected networks can provide supply chain executives with real time descriptive, predictive and prescriptive insight that, once established, allows for real-time visibility, customer segmentation intelligence, and planning.
Human Capital & Technology: With so many changes occurring in the Supply Chain today, many speakers emphasized the need for supply chain team members to embrace and become knowledgeable with the new technologies of analytics and data science.
In closing the RILA conference, former Commander of the USS Benfold and bestselling author, Mike Abrashoff, noted that a motivated and well led team was paramount to the supply chain. He called upon supply chain leaders to constantly lead and motivate their teams and embrace a culture of excellence. Commander Abrashoff closed with the compelling call to all supply chain leaders “If you’re not getting the results you’re looking for, challenge the process.”
As each conference highlighted, today we operate in challenging times, and the successful will embrace change and technology with a motivated team of professionals able to adapt and react quickly to the challenges of a changing industry landscape.
The major take away from both conferences was the acknowledgement that we are operating in challenging times and, in order to be successful, we must embrace the change and technology with a motivated team of professionals in order to adapt and react quickly to the challenges of a changing industry landscape.
By J. Michael Cavanaugh | Eric Lee | Holland & Knight
International containership carriers will implement recent amendments to the International Maritime Organization’s (IMO) Safety of Life at Sea (SOLAS) Convention on July 1, 2016, requiring shippers to provide verified gross mass (VGM) certificates to ocean carriers for all containers.
The VGM document requirement is mandatory, although IMO “Guidelines” on methods for implementation are not mandatory.
Key stakeholders are continuing to engage the U.S. Coast Guard in an effort to clarify its position on the U.S. application and enforcement of the SOLAS VGM requirement.
Some confusion and uncertainty has arisen in the international ocean shipping and logistics industry following several public statements and FAQs released by the U.S. Coast Guard in the past few days regarding the impending implementation of the IMO’s SOLAS Convention container weight regulation. Under SOLAS Chapter VI, Regulation 2, effective July 1, 2016, IMO flag-state containership operators and the marine terminals at which their vessels load must receive a shipper-signed weight certificate stating the “verified gross mass” (VGM) for each container before loading to the vessel. Major carrier and shipper stakeholders have interpreted the Coast Guard’s remarks as questioning whether the requirement is mandatory, whether it applies to shippers or will be enforced at U.S. ports, and what the Coast Guard will do to implement the rule. Industry stakeholders are continuing to engage the Coast Guard in an effort to clarify the Coast Guard’s position regarding application and enforcement of Regulation 2, e.g., the World Shipping Council’s March 3, 2016, letter to Admiral Paul F. Zukunft, Commandant of the Coast Guard.
What’s Certain
A review of SOLAS Chapter VI, Regulation 2, the recent Coast Guard statements and Coast Guard FAQs, as well as interpretations of the Regulation 2 amendments by ocean carriers and authorities worldwide, makes it clear that: 1) the SOLAS verified gross mass certificate (VGM) is mandatory for IMO flag-state vessels operating in international trade; 2) the VGM requirement will be implemented by July 1 for such vessels loading at U.S. ports; and 3) IMO “Guidelines” for implementation are not mandatory, so carriers and shippers have some flexibility to work out acceptable procedures. Although the Coast Guard now questions whether the SOLAS regulation applies to shippers or terminals in the United States, and sees little or no enforcement role for itself in the process, there is no dispute that it applies to the IMO flag-state vessels engaged in international trade, and thus the vessel operators may, and presumably all will, implement the shipper-signed weight document requirement as of July 1 at U.S. ports.
Regulation 2 Mandatory Requirements
Regulation 2, which is mandatory for IMO flag-state vessels (the U.S., most major shipping nations and international registries, e.g., Panama, Liberia, Marshall Islands, Bahamas), requires that shippers must verify by a reliable method the weight of each container tendered, that shippers must timely provide to the vessel’s master and the terminal a “shipping document” signed by the shipper’s representative verifying such weight, and that no container may be loaded to an IMO flag-state vessel for international carriage unless the shipper has provided the vessel operator and terminal with such document. Fully parsed out, the three short paragraphs of Regulation 2 covering this topic require the following:
- The shipper must verify the gross mass of each container
- The container gross mass must be stated in a “shipping document”
- The document must be signed by the shipper’s representative
- Weight cannot be estimated, and must be obtained by using one of two “Methods”:
- Method 1 – weigh the loaded container using equipment that is calibrated and certified per local requirements at point of weighing
- Method 2 – weigh goods and packing/dunnage using a certified method approved by competent authority at weighing location, and add to tare weight of container (printed on the container’s door)
- The document must be provided to the master and terminal prior to loading
If all the above are not done, then the carrier shall refuse loading. Note that Regulation 2 does not state the time by which the document must be provided. That may be established by the terminal or the carrier.
IMO Guidelines
Possibly leading to some of the current confusion is uncertainty regarding the IMO’s “Guidelines Regarding the Verified Gross Mass of a Container Carrying Cargo” issued June 9, 2014. The Guidelines are not mandatory, but they provide a more detailed discussion and definitions, and are “intended to establish a common approach for the implementation and enforcement of the SOLAS requirements regarding the verification of the gross mass of packed containers.”
Flexibility Allowed
Taken as a whole, Regulation 2, the IMO Guidelines and the Coast Guard’s statements and FAQs indicate that international shippers must provide signed VGM documents meeting the minimum procedural and content requirements of the regulation, and that vessels engaged in international trade will not load containers for which no such signed document has been provided prior to loading. Beyond this, however, the exact manner and arrangements by which carriers, shippers and regulators will implement and enforce Regulation 2 is flexible. Parties can cooperate to use any methods or procedures, as long as they satisfy all of the clear requirements of the regulation.
Additionally, note that Regulation 2, paragraph 6 states that “if the shipping document, with regard to a packed container, does not provide the verified gross mass and the master or his representative and the terminal representative have not obtained the verified gross mass of the packed container, it shall not be loaded on the ship.” If a container scheduled for loading has no document, paragraph 13 of the Guidelines suggests that the carrier or terminal themselves, or a subcontractor, could weigh it using Method 1 (weighing the loaded box) and proceed to load. In such a case, the carrier or terminal likely would impose a charge, which could be billed to the shipper if the parties had an arrangement in place, or the carrier or terminal might have the ability to charge the cargo based on a tariff, a bill of lading or other applicable terms.
Furthermore, paragraph 5.1.2.1 of the IMO Guidelines states that sealed packages arriving for shipment that have accurate weights marked on them do not need to be reweighed. Thus, a carrier receiving LCL items could rely on the package weight and use Method 2 to determine VGM prior to loading.
In addition, some ports, such as Charleston, have announced they will have weighing equipment available.
Coast Guard Position
In more recent statements, the Coast Guard questions whether Regulation 2 applies to shippers or terminals in the U.S. However, on its face, Regulation 2, which the Coast Guard confirms is mandatory, expressly states that shippers must determine container weight by Method 1 or 2, and must provide the weight document to the vessel master and terminal before loading. The World Shipping Council, which represents containership operators and participated along with the Coast Guard in the IMO process leading to adoption of the recent amendments, has sent a strong letter to the Coast Guard demanding further clarification of the agency’s interpretation.
For now, the Coast Guard’s position appears to mean the agency itself will not act to enforce the SOLAS regulations, and will not impose fines or take other regulatory action as to missing or inaccurate shipper weight certificates. However, this controversy may not have any material effect on shippers’ weight certificate obligations at U.S. terminals. The vessel operators – which the Coast Guard agrees are subject to the mandatory SOLAS regulations – are on track to implement the requirement on July 1, with or without Coast Guard compliance activity.
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