Importers face higher operations costs in New York terminals
Shorter free-time periods and higher demurrage charges at New York shipping terminals are forcing up costs for importers, often because of government-mandated inspections.
'I think it is taking business out of the port,' said David Schlenger, director of business development at American Cargo Express and vice president imports for the New York/New Jersey Freight Forwarders and Customs Brokers Association.
'To be penalized for actions that are beyond your control is not a fair way to do business,' said Donald A. Pisano, vice president of the American Coffee Corp. and board member and chairman of the traffic and warehouse committee for Green Coffee Association, whose members import 60,000 to 70,000 containers of coffee per year.
Schlenger said some terminals in New York charge demurrage after three or four days of free time while containers are waiting to be scanned by Customs and Border Protection, while others do not. He said his association has had discussions with terminals about trying to get demurrage waived while boxes wait for non intrusive inspections or to be taken off site for devanning.
He said some ports do not charge demurrage for boxes waiting to be scanned.
Even at terminals where demurrage is waived on boxes waiting to be inspected, he said some steamship lines continue to charge demurrage on containers or chassis.
Pisano also noted that sometimes CBP will require all the containers listed on a bill of lading to be held at the terminal, even if only one is actually being screened.
The discussion about demurrage and free time was just one topic in a free-wheeling panel discussion arranged by the Traffic Club of New York about heightened cargo security and its fallout.
Participants expressed skepticism about legislation passed earlier this year requiring 100 percent screening of containerized cargo.
While noting that container traffic coming to the United States is expected to double by 2015 and maybe triple by 2025, Schlenger questioned how every box could be screened.
'It's a labor intensive process,' he said. Even if boxes could be driven through a scanning machine, he added that analyzing images of scanned boxes takes time. If it wasn't, he said, 'no one would be delayed as they walk through passenger screening at the airport.'
Adele Fasano, area director for CBP in the New York/Newark area, said the agency currently screens 98 percent of containers with radiation detectors and that will be increased to 100 percent next year.
But she said CBP only conducts non-invasive scans with VACIS machines on five to seven percent of containers today and does not have the equipment to do 100 percent screening.
Suzanne Richer, president of Customs Trade Solutions, suggested that shippers who participate in the Customs-Trade Partnership Against Terrorism should take additional steps to participate in the Importer Self Assessment (ISA) program, which allows companies to monitor their compliance with U.S. trade laws and regulations.
Of 724,000 importers, she noted that only about 12,000 participate in C-TPAT, and only 146 participate in ISA. Companies that are in the C-TPAT program are eligible for ISA, she said, and if they don't participate they are 'leaving half the benefit on the table.'
She suggested, for example, that importers encountering delays with inspections at piers might be able to avoid some problems if they were ISA members.
But Pisano said that might not be realistic for small importers.
'It's quite a chore,' he said. 'It's not to be taken lightly.'