MARCH NEWSLETTER 2020

Posted by ORBIT LOGISTICS
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Welcome to this month’s edition of the Orbit Logistics Newsletter.

We are sending out regular updates on Coronavirus as we receive them, please keep a look out for them as they will have the most current information available for both Airfreight and Oceanfreight.

Everyone at Orbit hopes you, your family, loved ones gets through this ongoing and developing crisis

I can personally reassure you that we are ready to work offsite should self isolation be enforced.

Please don’t hesitate to email me or call on 0404444447 should you need any assistance during Coronavirus situation, I am just a call away from finding you a solution or discuss contingencies.

We will keep you abreast of all industry updates that come to light!
Stay safe and together we will get through this.

Glenn Allison
Managing Director

 


March 2020 Void Plan – Update

Please refer to the below updates, which will be void sailings in the coming weeks.

WEEK 8

A3S SERVICE

OPERATOR: ANL / COSCO / OOCL (COUNTED FROM XMN ONBOARD DATE)

VESSEL SIZE: AROUND 5500 TEUS

ROUTING: KHH – XMN – SKU – HKG – SYD – MEL – BNE

ORIGINAL ETD XIAMEN: 22 FEB / ETD SHEKOU: 24 FEB / ETD HONG KONG: 25 FEB

ORIGINAL ETA SYD: 07 MAR / ETA MEL: 11 MAR  / ETA BNE: 15 MAR 

 

NEW PANDA / FA2 / CAE / YOYO (COUNTED FROM XMN ONBOARD DATE)

OPERATOR: APL / H-SUD / MSK /MSC / ONE

VESSEL SIZE: AROUND 4500 – 5000TEUS

ROUTING: KHH – XMN – NSA – HKG – YTN – MEL – SYD – BNE

ORIGINAL ETD XMN: 19 FEB / ETD HKG: 22 FEB / ETD YTN: 23 FEB

ORIGINAL ETA MEL: 8 MAR / ETA SYD: 11 MAR / ETA BNE: 14 MAR

 

WEEK 9

A3S SERVICE

OPERATOR: ANL / COSCO / OOCL (COUNTED FROM XMN ONBOARD DATE)

VESSEL SIZE: AROUND 5500 TEUS

ROUTING: KHH – XMN – SKU – HKG – SYD – MEL – BNE

ORIGINAL ETD XIAMEN: 29 FEB / ETD SHEKOU: 02 MAR / ETD HONG KONG: 03 MAR

ORIGINAL ETA SYD: 14 MAR / ETA MEL: 18 MAR  / ETA BNE: 22 MAR

NEW PANDA / FA2 / CAE / YOYO (COUNTED FROM XMN ONBOARD DATE)

OPERATOR: APL / H-SUD / MSK /MSC / ONE

VESSEL SIZE: AROUND 4500 – 5000TEUS

ROUTING: KHH – XMN – NSA – HKG – YTN – MEL – SYD – BNE

ORIGINAL ETD XMN: 26 FEB / ETD HKG: 29 FEB / ETD YTN: 01 MAR

ORIGINAL ETA MEL: 15 MAR / ETA SYD: 18 MAR / ETA BNE: 21 MAR

 

WEEK 10

NEW PANDA / FA2 / CAE / YOYO (COUNTED FROM XMN ONBOARD DATE)

OPERATOR: APL / H-SUD / MSK /MSC / ONE

VESSEL SIZE: AROUND 4500 – 5000TEUS

ROUTING: KHH – XMN – NSA – HKG – YTN – MEL – SYD – BNE

ORIGINAL ETD XMN: 04 MAR / ETD HKG: 07 MAR / ETD YTN: 08 MAR

ORIGINAL ETA MEL: 22 MAR / ETA SYD: 25 MAR / ETA BNE: 28 MAR

A1X / CA6 SERVICE  (COUNTED FROM QDO ONBOARD DATE) ß Slide one week to week 11

OPERATOR: APL / EMC / HMM / ONE / HPL

VESSEL SIZE: AROUND 3000 – 4000 TEUS

ROUTING: PUS – QDO – NGB – SHA – YTN –  SYD – MEL – BNE

ORIGINAL ETD QDO: 27 FEB / ETD NGB: 29 FEB / ETD SHA: 02 MAR / ETD YTN: 05 MAR

ORIGINAL ETA SYD:  16 MAR / ETA MEL: 19 MAR  / ETA BNE: 23 MAR

WEEK 11

A3S SERVICE

OPERATOR: ANL / COSCO / OOCL (COUNTED FROM XMN ONBOARD DATE)

VESSEL SIZE: AROUND 5500 TEUS

ROUTING: KHH – XMN – SKU – HKG – SYD – MEL – BNE

ORIGINAL ETD XIAMEN: 14 MAR / ETD SHEKOU: 16 MAR / ETD HONG KONG: 17 MAR

ORIGINAL ETA SYD: 29 MAR / ETA MEL: 01 APR  / ETA BNE: 05 APR

WEEK 13

NEW PANDA / FA2 / CAE / YOYO (COUNTED FROM XMN ONBOARD DATE)

OPERATOR: APL / H-SUD / MSK /MSC / ONE

VESSEL SIZE: AROUND 4500 – 5000TEUS

ROUTING: KHH – XMN – NSA – HKG – YTN – MEL – SYD – BNE

ORIGINAL ETD XMN: 25 MAR / ETD HKG: 28 MAR / ETD YTN: 29 MAR

ORIGINAL ETA MEL: 12 APR / ETA SYD: 15 APR / ETA BNE: 18 APR

WEEK 14

CAT SERVICE  (COUNTED FROM NGB ONBOARD DATE)

OPERATOR: YML / SINOTRANS / EMC  / TSL / APL

VESSEL SIZE: AROUND 4200 TEUS

ROUTING: NGB – SHA – SKU – KAO – SYD – MEL – BNE

ORIGINAL ETD NGB: 28 MAR / ETD SHA: 30 MAR / ETD SKU: 02 APR

ORIGINAL ETA SYD: 16 APR / ETA MEL: 19 APR / ETA BNE: 24 APR

NEW PANDA / FA2 / CAE / YOYO (COUNTED FROM XMN ONBOARD DATE)

OPERATOR: APL / H-SUD / MSK /MSC / ONE

VESSEL SIZE: AROUND 4500 – 5000TEUS

ROUTING: KHH – XMN – NSA – HKG – YTN – MEL – SYD – BNE

ORIGINAL ETD XMN: 01 APR / ETD HKG: 04 APR / ETD YTN: 05 APR

ORIGINAL ETA MEL: 19 APR / ETA SYD: 22 APR / ETA BNE: 25 APR

 


Dumping Duty And Facts in Australia

There was a time when the importation of aluminium extrusions was not seen as risky.  Only general duty rates applied and it didn’t really matter much whether the importation was seen as a mere profile or an unassembled structure.  That was before aluminium extrusions from China were subject to dumping duties of over 100%.  The old days are not coming back and there are currently 5 new investigation on foot that may extend the application, or increase the amount, of the dumping duties.

The new investigations and the actions to be taken are set out below.

Five more years of dumping duties on Chinese aluminium extrusions

Dumping duties are in place for 5 years and automatically expire unless an application for continuation is made.  Dumping duties on Chinese exports of aluminium extrusions were due to expire in 2020.  However, the Australian industry has lodged an application for continuation of the duties.  The Anti-Dumping Commission (ADC) has in turn commenced a continuation inquiry.

The ADC will consider whether dumping from China is likely to continue and if so, would that dumping continue to cause injury to the Australian industry.  Given Chinese exports comprise over 50% of the aluminium extrusions exported to Australia and the last review found increasing levels of dumping, a continuation of the duties seems inevitable.  However, what is most important is that the ADC will use the inquiry as an opportunity to review the applicable rates.

A rate review could see a change in rates applying to:

  • specific named exporters (the top 5-6 exporters),
  • residual exporters (those that cooperate but do not receive their own rate); and
  • all other exporters (these are the exporters who currently have a rate of 101.9%).

Importers need to inform their suppliers of this inquiry and be urging their involvement.  Interested parties should also take the opportunity to make submissions regarding how dumping margins are calculated, whether the Australian industry is suffering loss and if so, are dumped imports from China the cause of that loss.

A more detailed update on this inquiry can be found here.

https://www.ftalliance.com.au/news/17580


Peru Australia Free Trade Agreement (PAFTA)

The Free Trade Agreement between Peru and Australia (PAFTA) will come into force on  February 11, 2020.

All information on the PAFTA can be found HERE

A guide has been prepared and explains how to determine whether goods that are imported to Australia are eligible for preferential rates of customs duty under the PAFTA in accordance with the Customs Act 1901 and the PAFTA rules of origin. The Guide to Origin advice referred to in the document can be found HERE.

Some points to note in the new agreement, as reviewed by Russell Wiese, Principal at Hunt and Hunt Lawyers, and myself are as follows

  1. A claim for preference under PAFTA must be supported with a Certificate of Origin (COO) (self certified) .However at present there is no prescribed format for that COO.Also note that PAFTA does not require third party certification.An authorised representative of the exporter or producer may complete a PAFTA COO and need not follow a prescribed format but must contain the prescribed data elements at Annex 3-A of the Agreement and cross referenced at page 42 and 43 of this Guide.The content of Attachment B to the PAFTA Guide on the DFAT website provides examples that producers, exporters and authorised representatives may use, to assist in meeting PAFTA Certificate of Origin requirements, but they are not prescriptive.
  2. For importers that are Trusted Traders, the Australian Border Force (ABF) has waived the requirement for the production of a COO.  However, it is still of utmost importance that the importer have a reasonable basis for its belief that the goods meet the requirements of PAFTA; and
  3. Like many FTAs, the consignment rules mean the FTA does not apply where the goods enter a third country and do not remain under customs control.  This needs to be carefully considered if the goods have travelled from Peru to a different South or Central American port and not remained under Customs control.

 


Asbestos Risk Management – A simple declaration?

During the recent Compliance Advisory Group (CAG) meeting I had the opportunity to spend considerable time discussing this matter with the Australian Border Force (ABF)

The ABF will not generally accept a simple declaration from the importer as sufficient due diligence that goods are asbestos free, especially if they are goods or from an origin listed HERE.

The ABF expects importers to be able to demonstrate that they have undertaken adequate risk assessment measures for their goods that are known to be at risk of containing asbestos, or are supplied from countries with asbestos producing industries.

The nature and level of information within the supporting documentation may provide adequate assurance depending on the risk of the goods containing asbestos. Several types of documentation may be necessary to demonstrate a sufficient level of assurance. A non-exhaustive list of examples of supporting documentation could include:

  • Declarations which state that the goods have nil asbestos content (supported by evidence);
  • Documentation outlining the level of assurances taken throughout the supply chain;
  • Invoices demonstrating the supplier of the goods;
  • Information about the supply chain and possible quality assurance processes in place;
  • Illustrative Descriptive Material;
  • Ingredient lists;
  • Test certificate or laboratory report;
  • Material Safety Data sheets.

Solely relying on a declaration that states the goods have nil asbestos content from an importer and/or supplier may not provide adequate assurance.

When a customs broker receives a declaration from an importer stating the goods have nil asbestos content, the customs broker should ensure they have an understanding of what assurances/supporting evidence the importer is able to provide to support the declaration, if requested by the ABF.

Identified risks of asbestos in a supply chain should be mitigated by testing of the goods through an accredited laboratory, prior to shipment to Australia. A laboratory certificate showing test results to Australian requirements, should be obtained. This may assist in expediting border clearance.

Useful Links

https://www.agriculture.gov.au/import/goods/food/notices/ifn02-20


Reminder of Accurate Verified Gross Mass (VGM) Submission

According to the official notice of (Circular No. 92) released by Ministry of Transport of People’s Republic of China, effective from 1st July 2016, a packed container will no longer be allowed to be loaded on board vessels unless the shipper name in the Bill of Lading has provided its Verified Gross Mass (VGM) to the ocean carrier and/or the terminal representative.

The SOLAS amendments require shippers to verify the gross mass of the packed containers and undertake the duty and obligation of verifying the gross weight of its packed container before it can be loaded onto a ship.  The discrepancies between the verified container gross mass declared by the shipper and the verified gross mass obtained by marine management agencies, vessels, carriers or terminal operators must be within +/-5% or 1 ton (the smaller value applies).  Meanwhile, the weight should be within the container payload.

To improve the safety of shipping, we kindly remind all our customers to submit VGM strictly prior to VGM cut-off deadline and ensure the accuracy of the VGM data.  Any consequence of VGM misdeclaration or concealing, including but not limited to penalty for damage, direct and indirect economic loss, will be borne by the shipper.  The shipping line will reserve the right to pursue its legal responsibility.


Customer Advisory – Yang Ming’s Statement regarding media reports on YM Eternity Arrest Incident

Yang Ming Marine Transport Corp. (Yang Ming) is aware of a number of media reports circulating regarding Yang Ming’s vessel YM Eternity was arrested in Sydney on February 9th, 2020. To avoid any further misleading to the public, we would like to make the following statement in response to media reports on the incident:

1. Yang Ming would like to confirm that YM Eternity has been released from arrest on February 10th, 2020 and normal cargo operations has been resumed immediately.

2. Yang Ming regrets any inconvenience to Australians and apologizes for the conduct of Australian Maritime Safety Authority (“AMSA”) in arresting the YM Eternity in a way that caused unnecessary and maximum inconvenience to Sydney customers on a Sunday and without any notice.

3. With regard to the YM Efficiency incident happened in June 1st 2018, Yang Ming and our insurer responded quickly and effectively to the incident with the immediate allocation of very significant resources and manpower to the loss of the containers and their contents. Yang Ming has been ever since committed to keeping the Hunter Coast pristine and working with the New South Wales Government to ensure all debris that could possibly be associated with the incident is cleaned up within hours of its being reported – even if it was not actually from cargo on the ship. These clean-up operations were at very large expense, all paid by Yang Ming and our insurer.

4. Yang Ming, in association with New South Wales Government and AMSA, organized for sonar scanning of the sea floor commencing after the incident and that has continued subject to weather and safety considerations since.

5. All of the containers lying on the sea floor are in deep water (about 120 meters) with most of the containers lying outside of the Australian territorial sea. Expert reports obtained by Yang Ming conclude that attempting to remove the containers will cause more risk of environmental damage than leaving them in place. The operations to remove the containers shall result in plastics within the containers being released into the ocean. As a consequence, these experts have recommended, considering all the environmental factors, the containers are best left on the sea floor pending further monitoring off the release of plastics from the containers.


Indonesia Ratifies Australian Free Trade Agreement

INDONESIAN politicians have officially ratified the Indonesia-Australia Comprehensive Economic Partnership Agreement (IA-CEPA).

The vote occurred last week.

“This agreement should really boost Indonesia’s export performance so that it could positively affect the country’s trade balance,” said House of Representatives Commission VI chairman Martin Manurung, quoted in The Jakarta Post.

The IA-CEPA is expected to bring tariff cuts on commodity exports between the two countries and offer various investment privileges.

Australia previously ratified the agreement late last year.

The vote occurred ahead of a visit to Australia this week by Indonesian President Joko Widodo who addressed the House of Representatives in Canberra.

According to the Department of Foreign Affairs and Trade, Australia’s two-way trade with Indonesia was worth $16.8bn in 2017-18, making Indonesia Australia’s 13th largest trade partner. According to DFAT, agricultural products are among Australia’s key merchandise exports to Indonesia, while crude petroleum and manufactured goods are key imports. Indonesia was Australia’s largest market for wheat ($950m) and live animals ($575 million) in 2017-18.


2019 Worst Year for Air Freight Demand Since 2009

Geneva – The International Air Transport Association (IATA) released full-year 2019 data for global air freight markets showing that demand, measured in freight tonne kilometers (FTKs), fell by 3.3% compared to 2018 while capacity (AFTK) rose by 2.1%. This was the first year of declining freight volumes since 2012, and the weakest performance since the global financial crisis in 2009 (when air freight markets contracted by 9.7%).

In the month of December, cargo volumes contracted 2.7% year-on-year while capacity rose 2.8%.

Air cargo’s performance in 2019 was dampened by weak growth in global trade of just 0.9%. The sector’s underperformance was also due in particular to slowing GDP growth in manufacturing-intensive economies. Softer business and consumer confidence, along with falling export orders, also contributed to air freight struggles.

There are signs that confidence and orders could pick up in 2020. It is too early to say what long-term effects will be seen from the impact of restrictions associated with combatting the coronavirus outbreak.

“Trade tensions are at the root of the worst year for air cargo since the end of the Global Financial Crisis in 2009. While these are easing, there is little relief in that good news as we are in unknown territory with respect to the eventual impact of the coronavirus on the global economy. With all the restrictions being put in place, it will certainly be a drag on economic growth. And, for sure, 2020 will be another challenging year for the air cargo business,” said Alexandre de Juniac, IATA’s Director General and CEO.

Regional performance

All markets except Africa suffered volume declines in 2019. Asia-Pacific retained the largest share of FTKs, at 34.6%. The share of freight traffic increased modestly for both North America and Europe, to 24.2% and 23.7%, respectively. Middle East carriers’ traffic share held steady at 13%. Africa and Latin America saw their shares lift marginally, to 1.8% and 2.8%.

Asia-Pacific carriers in December posted a decrease in demand of 3.5% compared to the same period a year earlier. Capacity increased by 2.8%. The full-year 2019 saw volumes decline 5.7%, the largest decrease of any region, while capacity increased by 1.1%. As the world’s main manufacturing region, international trade tensions and the global growth slowdown weighed heavily on regional air freight volumes in 2019.  Within-Asia FTKs were particularly affected (down 8% compared to a year ago).

North American airlines saw volumes fall by 3.4% in December, while capacity grew by 2.1%. For 2019 in total, the region’s cargo volumes declined by 1.5%, compared to a capacity increase of 1.6%. Trade tensions and cooling US economic activity in the latter part of the year have been factors in the decline. The 5.6% fall in international year-on-year volumes in December was the weakest monthly growth outcome for the region since early 2016.

European airlines experienced a 1.1% year-on-year decrease in freight demand in December, with a capacity rise of 4.9%. The fall in December was typical of the performance for 2019 as a whole, where volumes fell 1.8%, but capacity increased by 3.4%. Softer activity, including in the manufacturing-intensive German economy, combined with ongoing Brexit uncertainty, contributed to the 2019 result, which in international freight volume terms was the weakest since 2012.

Middle Eastern carriers’ freight volumes decreased 3.4% year-on-year in December and capacity increased by just 1.9%, the lowest of any region. This contributed to an annual result of a decline in demand of 4.8% in 2019 – the second greatest decline in growth rate of all the regions. Annual capacity increased just 0.7%. Disruption to global supply chains and weak global trade, together with airline restructuring in the region, were the chief drivers of the weaker freight outcome.

Latin American airlines suffered the sharpest fall in demand of any region in December, of 5.3%. The region was also the only one to see a reduction in capacity (-3.1%). Although the region was the second strongest performer across 2019 as a whole, limiting its decline in volumes to just 0.4%, social unrest and economic difficulties in several key countries led to the weakest international FTK outcome since 2015. Annual capacity increased 4.7%.

African carriers’ saw freight demand increase by 10.3% in December 2019, compared to the same month in 2018. This was reflected in the strong 2019 full-year performance, which saw Africa freight volumes expand 7.4%. Capacity in December grew by 10% and for 2019 in total, increased by 13.3%. Over the year, air cargo volumes have been supported by strong capacity growth and investment linkages with Asia.

Read the Air Freight Market Analysis report for December 2019 (pdf)


Australian Customs Notice No. 2020/08 – Rates of Exchange and the day of exportation

There is a new determination of the correct date of valuation in accordance with the legislation, which has been an intense discussion with the Australian Border Force (ABF) since 2016, with prolonged debates at Compliance Advisory Group and other consultative body meetings.

The Valuation Date is important because that is the date used for currency conversion, which impacts the calculation of duty and taxes payable. The legislation provides at CA s.161J that it is the date that the goods departed from the place of export, which is defined in s.154(1) for containerized freight as the place where the goods were packed in a container OR, where that date is not known, “the place where the goods are placed on board a ship or aircraft for export”.

The long-standing policy and practice as outlined in ACN 2002/01 and the valuation “Instructions and Guidelines” was to use the “on board” date on the bill of lading, which is in accordance with the requirements of the legislation. Then it changed, with no pre-advice, and error rates on Formal Import Declarations (FIDs) skyrocketed because officers began to require that brokers determine the date the container passed through the gate at the terminal (time consuming and not always possible to determine of course). Too often as brokers we pick our fights and make commercial decisions to not pursue disputed matters further and that is what happened here. We needed to get the cargo off the wharf and the FID cleared and so we amended the dates.

This requirement was neither a fast nor a realistic suggestion of course, especially when the net difference in duty payable as a consequence of varying exchange rates over a day or two was small.  It also was not in accordance with the provisions of the Customs Act and the Department’s own published guidelines or trade facilitation agenda.

As a whole the industry is delighted to advise that the ABF have now agreed and that after years of discussion have agreed with our position and issued Australian Customs Notice No. 2020/08 – Rates of exchange and the day of exportation

It is important to note that where the date the goods left the packing place is not known, the date on the Bill of Lading can be used. The ACN also confirms that there is no requirement to try and determine the first date if it is not known at the time of entry.