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Black Sea Grain Corridor Faces Backlog of Ships, Third Largest Rail Union Rejects Labor Deal, TikTok Looking to Enter eCommerce Fulfillment Market as Amazon Competitor.

Oct 13, 2022

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Black Sea Grain Corridor faces backlog of ships. The renewal of Ukrainian grain shipments under the Black Sea Grain Initiative has made a tangible impact, adding 6.5 million tons of agricultural commodities to the supply in Europe, Africa and Asia since August 1. According to a new report from the Financial Times, the ship inspection process built into the multiparty safe corridor agreement has turned into a bottleneck. A backlog of about 120 bulkers has built up on both sides of the route, and each must be inspected by Ukrainian, Russian, Turkish and UN inspectors before it can proceed in or out. According to Maritime Executive, the inspection team has been processing about seven ships a day at a designated anchorage in the Sea of Marmara, but the waiting time per vessel is now in the range of two weeks as a result of the backlog.

FMC Proposes New Demurrage and Detention Billing Requirements. The Federal Maritime Commission (FMC) announced that it is proposing a new rule that seeks to “bring more clarity, structure, and punctuality to the demurrage and detention billing practices of vessel operating common carriers (VOCCs), non-vessel-operating common carriers (NVOCCs), and marine terminal operators (MTOs).” The FMC is proposing that “a properly issued invoice is only issued to the person that has contracted with the billing party for the carriage of goods or space to store cargo and the billed party is responsible for the payment of any incurred demurrage or detention charge.” From the NPRM, the FMC is specifically interested in receiving comments on whether it would be appropriate to include the consignee named on the bill of lading as another party who may receive a demurrage or detention invoice. Read the full notice from the FMC here. For information on implementation or to submit comments, click here.


Imports see steepest drop since 2020 in September. September imports were down 11% year on year and 12.4% compared to August, according to Descartes. September’s 313,311-TEU decline versus August was the steepest month-to-month drop since the 364,454-TEU plunge in February 2020 versus the month before, when Chinese authorities first locked down Wuhan towards the beginning of the pandemic. A decline in warehouse orders leaving storage and heading to retailers is another signal of the pullback in consumer demand, according to CNBC. The latest data from WarehouseQuote shows that outbound orders from customers shipping to retailers is down by one-third (-33%) year over year.


U.S. Department of Labor announces proposed rule on determining employment status for independent contractors. A proposed rule from the Biden administration could raise costs for trucking companies and gig transportation that rely on independent contractors. The U.S. Department of Labor’s Wage and Hour Division (WHD) revealed the 184-page proposed rule on Tuesday, which would reinstate guidance similar to that used under the Obama administration that is considered less favorable to classifying workers as independent contractors, according to FreightWaves. “Through our enforcement in the wage and hour division, we know that misclassification is occurring in many industries and sectors,” said Principal Deputy Administrator of WHD Jessica Looman during a media briefing Tuesday. “We believe the proposed regulation would better protect workers from misclassification, while at the same time providing a consistent approach for those businesses that engage or wish to engage with independent business contractors.”


Third largest rail union rejects labor deal. On Monday, the Brotherhood of Maintenance of Way Employees Division of the Teamsters said in a statement that 56% of its members had voted against the tentative agreement brokered by the Biden administration last month to avert a nationwide railroad strike. The union is the third largest in the rail sector, representing more than 11,000 workers. “Railroaders are discouraged and upset with working conditions and compensation and hold their employer in low regard,” union President Tony D. Cardwell said in a statement. “Railroaders do not feel valued. They resent the fact that management holds no regard for their quality of life, illustrated by their stubborn reluctance to provide a higher quantity of paid time off, especially for sickness.” The union will reportedly delay any strike until five days after Congress reconvenes in mid-November to allow time for additional negotiations.


International Civil Aviation Organization votes for net-zero emissions by 2050. Last week, member states at IMO’s sister body at the United Nations, the International Civil Aviation Organization (ICAO), voted to adopt a collective long-term global aspirational goal (LTAG) of net-zero carbon emissions by 2050. “States’ adoption of this new long term goal for decarbonized air transport, following the similar commitments from industry groups, will contribute importantly to the green innovation and implementation momentum which must be accelerated over the coming decades to ultimately achieve emissions free powered flight,” said the president of the ICAO Council, Salvatore Sciacchitano.

Delta invests in air taxi startup. Delta is investing $60 million in startup Joby Aviation, and will also have an exclusive five-year partnership with the company. Joby Aviation is planning to build and operate an electric vertical takeoff and landing aircraft, or eVTOL. These eVTOLs are essentially air taxis. Joby and Delta will initially target eVTOL service to and from airports in New York City and Los Angeles, though the companies “envision the service growing to other airports around the country and eventually overseas,” according to CNBC.


Shipping traffic stops after Crimea bridge attack. Last weekend, shipping from the Sea of Azov to international markets came to a stop after a bombing attack that took out a large chunk of the bridge linking the Crimean peninsula with mainland Russia. The 19 km bridge crosses the Kerch Strait, which links the Sea of Azov with the Black Sea. The strait usually sees traffic from 15 to 16 tankers from the south or north on a daily basis.


PayCargo awarded $11 Million in case against CargoSprint. On Tuesday, federal court ruled that PayCargo competitor CargoSprint conducted “willful, pervasive and relentless” infringement and awarded PayCargo more than $11 million plus prejudgment interest and attorneys’ fees. The judge in the United States District of Florida found CargoSprint liable for “willful, pervasive and relentless” infringement of PayCargo’s federal trademarks and breach of contract. Read Paycargo’s statement here.

TikTok looking to enter ecommerce fulfillment market as Amazon competitor. TikTok is reportedly planning to build its own product fulfillment centers in the U.S. and establish itself as an e-commerce supply chain system, indicated by over a dozen new job openings posted to LinkedIn by TikTok. “By providing warehousing, delivery, and customer service returns, our mission is to help sellers improve their operational capability and efficiency, provide buyers a satisfying shopping experience and ensure fast and sustainable growth of TikTok Shop,” the company wrote in one job listing. It does not appear that TikTok plans to build out its own transportation unit like shipping giant Amazon as of yet. The job postings so far imply that TikTok would work with vendors to handle shipping, parcel consolidation and transportation, according to Axios.

Intel plans to cut thousands of jobs this month. Intel Corp. is reportedly planning mass layoffs in order to cut costs and “cope with a sputtering personal-computer market,” according to people with knowledge of the situation, Bloomberg reports . The layoffs, which will likely number in the thousands, will be announced as early as this month. The company is planning to make the move around the same time as its third-quarter earnings report on Oct. 27, said the source, who asked not to be identified because the deliberations are private. As of July, the chipmaker had 113,700 employees.