Household Goods Shipping Problems

The Federal Maritime Commission voted unanimously June 23 to star a major investigation into complaints from several people who have shipped  household goods and personal property in U.S. to foreign countries via Ocean Freight. This investigation is about the nature, scope and frequency of the problem of potentially unfair, unlawful or deceptive practices of several Shipping Companies and to make recommendations for possible FMC action. An interim report is due no later than Nov. 15 and a final report is due no later than Feb. 15, 2011.

Apparently between 2005 and 2009 the FMC received over 2,500 consumer complaints related to household goods moving companies that were shipping personal effects and vehicles between various locations in the U.S. to various foreign destinations.

Among the complaints were a failure to deliver the cargo and refusal to return the pre-paid ocean freight charges, loss of cargo,  delays in delivery, charges to the customer for marine insurance that was never obtained, wrong information as to the whereabouts of the goods, over pricing, and after some shipments were delivered there have been threats to withhold the shipment unless the increased charges were paid that were not pre-quoted, in some cases the Forwarder refused to pay the common carrier engaged by the company as the intermediary, which resulted in the customer having to pay double for freight. Another problem was that some individuals and companies had falsely represented themselves to perform ocean transportation and accept responsibility for the movement of these shipments without obtaining an ocean transportation intermediary (O.T.I) license which also provides the required proof of financial responsibility.

So in short, BUYER BEWARE.   If you are thinking of shipping your personal goods anywhere from the U.S. to a Foreign country, do your due diligence, as there are sharks out there looking to take advantage of your naivety.  Make sure the Company has references, they are licensed with a good track record.

Or to make things easier just use Universal Cargo Management.

The Future of Your Business Could Be International Shipping

Recently we have seen China come out and say that they will  "further reform the RMB exchange rate regime and enhance the RMB exchange rate flexibility"

We all know that CHINA has undervalued their currency for the greater part of the past decade where they have been the hub of manufacturing for all developed countries in the world. The Chinese government  has had the goal of their  export manufacturing being the engine for economic growth and job creation in China for the past 25 years. The strategy has largely worked, with China putting up better than 10% annual GDP growth for the past 30 years.  By announcing their plans to reform their fixed-rate system, China is finally signaling a willingness to allow supply and demand to determine the value of its currency.  They are following in the vision implemented by Deng Xiao Peng over 20 years ago when they opened up Shenzen and Guangzhou as their “experiment” with FREE ENTERPRISE.   Interesting that it came about the time the Berlin wall was coming down and the whole world had seen not only  that communism doesn’t work, it is a destructive force with Tsunami power in demolishing societies, as it tragically did with China from 1949 until the early ‘90’s when China started to wake up and smell the coffee brewing over in West.

So now if you walk down a major street in Shanghai, you will see at least 3 Starbucks within one block radius.  You first have to pass  a KFC, McDonalds and a few Malls the size of a small town (underground up to 5 floors high) and you would swear you were in Manhattan.

 Given China's trade surplus and all of that foreign investment cash  flowing into China, the consensus is that China's currency should appreciate quite a bit -- with some experts suggesting that their exchange rate will strengthen  to 4 or 5 RMB to the dollar rather than the current 6.8 RMB to the dollar , 25% increase, coming soon !!!

So if you are an average American that has a home filled with about 75% of goods made in China, or worse yet, your business is directly related to imports from China; Importer, Wholesaler, Logistics, Transportation, retail, etc, you have to see the writing on the wall that the U.S. dollar is only going to get weaker.   Besides the China factor, history has proven that recessions always follow with inflation.  

So money will continue to be tight, consumer costs will continue to rise, and let’s not forget about the hidden inflations ; TAXES,( thank you Democrats) ILLEGAL IMMIGRATION (Thank you Ted Kennedy ’64), INTEREST on our National debt, soon 40% of tax revenue to the U.S, Treasury will go towards servicing the debt, and who really pays for this ? (Thank you Progressive movement), the U.S. Bogus system of calculating actual inflation, cooked books (Thank you past Administrations going back 20 years) and then we have the brand new one courtesy of Mr. Obama, the HEALTH CARE BILL.  Health insurance will go up dramatically, forcing employers to pay more in premiums and taxes which will be passed on in the rising costs of goods and services to the public and further increased unemployment.

What we are left with in the coming decade is among other more dire circumstances, which I will not delve into, but one of great significance. That is the U.S. will have to become an economy dependent upon exports.  Not just of Cotton, Lumber, Scrap, waste paper, Agriculture, Rawhide, etc, but actual consumer manufactured goods.

Most people don’t realize that with all the ballyhoo about our trade deficit with China being so huge, is that the U.S. economy is still at least 4- 5 times larger than China’s and our exports still outnumber those of China.  It is mind boggling I know, but now that you see our dollar destined for another WEIMAR REPUBLIC, together with CHINA’s growing middle class (more than the population of the U.S.) with an RMB at 4 or 5 per USD, it doesn’t take a Rocket Scientist to deduce that China as well as other healthy economies (wherever they are) can afford to buy goods made in the Good old YOO ESS OF AYE.

So if you are wondering “ where is the future of my business”….now is a good time to seriously evaluate how manufacturing and exports can fit into the picture.

I would also like to add that it has become “In” and trendy in China to buy goods made in the USA now.  In fact the “Yuppies” of China are willing to pay higher prices for higher end merchandise and anything that reflects the American way of life.   The real truth is that people in China are in love with America and want to emulate our lifestyles.  This is the future. (that and our children better start learning mandarin)

Devin T. Burke
CEO, Universal Cargo

New Air Cargo Inspections Starting August 1st

Lenny P. Feldman and John B. McGowan of Sandler, Travis & Rosenberg, P.A. at www.strtrade.com announced on their website that all air cargo flown outbound or domestic will be screened. This includes bonded cargo transiting the us.

It's anticipated that there will be a period of adjustment as this requirement gets "digested" and for the airport infrastructure to gear-up and staff-up for the additional demand for screenings.

New opportunities open up for businesses with IAC and CCSP after applying for TSA certification.

BOTTOM LINE: Expect delays and/or additional administrative overhead as the Transportation Security Administration provisions this new measure. New oportunities for those in the business of transportation safety. Universal Cargo Management, inc. stands ready assist you in preparing for domestic and international shipping.

5 Tips for 1st Time Cargo and Container Shipping Exporters

Tip #1: Save container transport cost by preparing to load your container in less less than 2 hrs.

When the driver shows up to your site, the first 2 hours are included in your fees. We recommend staffing up and preparing in advance to load the container as quickly as possible to avoid overtime charges.

Tip #2: Prepare Shipping Container Contents for Extremes

Containers are subject to extreme conditions. There are wild swings in temperature and humidity inside the container - they go througth the Panama Canal and sometimes around the Cape. Containers are subjected to triple digit heat and humidity to sub-zero temperatures while in storage or in transport.

Tip #3: Carefully Declare ANY Organic Cargo

Plants, Edible Plants, Vegetables and Fruit are all treated differently depending on the origin and destination of the shipment. If customs finds any undeclared organic cargo, the can quarantine your container and charge you daily holding fees.

Tip #4: Properly Insure Your Cargo 

Plan for “attrition”. All of the contents don’t always make it all of the time.
There will be some "attrition" - containers get inspected, sometimes by unscrupulous dock/deck hands...this isn't REALLY considered stealing, as the items in transit, technically are the property of the shipping company.

Tip #5: Understand that Freight Forwarding both an art and a science.

Many companies and handlers are involved in moving your container, here are just a few possible examples: Trucking company(ies) outbound (your door to the port of origin or train yard), Crane Operations transferring container from truck to train, and train to ship. that's just to get the container to the ship, then the reverse happens on the other side...it's a REALLY rough ride, even in good weather.

Why Universal Cargo Management, Inc.

By contracting with Universal Cargo Management, Inc. you directly benefit from the relationships and reputation for integrity that we have developed trusted relationships with our international shipping, air freight, ocean freight, and logistics service providers over the past 25-years. You benefit from our experience in keeping the freight forwarding process efficient an effective because we know the ropes as well, if not better than anyone.

Tips for Business Travel To Asia

Making sense of ocean freight and air freight rate fluctuations

In trying to make sense of recent sea freight and air cargo rate fluctuations, we've gathered information from several sources and made the following observations:

1) Rates are going up and staying up, not down

2) Space will be an issue probably all year

3) Expect “new” surcharges

IN SHORT: We're all paying for that great 12 months we all had with the lowest freight rates in History between Oct ’08 through Sep ’09.

• Lack of boxes adds to transpacific capacity squeeze, freight forwarders fear new surcharge
• Battle for Space on the Transpacific: Richard Owens, Asia Pacific CEO for DHL’s global customer solutions unit, told IFW that even “a company with DHL’s clout” was being forced to fight for space.

Here's a rate chart showing what we're seeing (as of 29-May-2010) at Universal Cargo Management, Inc.   

CARRIER	EFFECTIVE DATE	2010 PSS				Remark
APL	2010.8.1	320	400	450	505	from China to USA (except Puerto Rico and Virgin Islands)
CMA	2010.6.15	320	400	450	510	from Asia to USA/Canada (East & West Coast, IPI, MLB) - cargo receipt date at origin
Cosco	2010.6.15	320	400	450	506	from Far East and Indian Sub-Continent to USA/Canada
CSAV	2010.6.15	320	400	450		from Asia to USA
CSCL	2010.6.1 ~ 2010.11.30	320	400	450	505	from Far East, Middle East and Indian Subcontinent countries/areas to USA
EMC	2010.6.15	320	400	450	506	from Far East (except India)/S.Africa to USA/Canada
	2010.6.15	360	450	506	570	from India to USA/Canada
Hapag	2010.6.28	320	400	450	510	from Asia and Indian Sub-Continent to USA/Canada, except India - date of cargo receipt at origin
	2010.6.28	300	375	425	n/a	from India to USA/Canada - date of cargo receipt at origin
Maersk	2010.6.15	320	400	450	510	from Far East Asia to USA/Canada (Transpacific Eastbound)
Matson	2010.6.16	320	400	450	506	Transpacific Eastbound (excluding Hawaii, Guam)
MOL (PSC)	2010.6.15 ~ 2011.3.31	400	500	565	635	from Asia to USA/Canada
MSC	2010.6.15	320	400	450		to USEC and US intermodal points via USEC
	2010.6.15	400	500	563		to USWC and US intermodal points via USWC
OOCL	2010.6.15 ~ 2010.11.30	320	400	450	505	to USA/Canada - base on cargo receiving date
Wanhai	2010.6.15 ~ 2010.11.30	320	400	450	510	to USWC

Making up lost shipping and ocean freight revenues

Container Transport News: Furniture Exporting Gaining Momentum..

Changes in demand for global freight logistics

 ...Can an Importer from Shreveport, Louisiana Partner with an Exporter in Louisville, Kentucky?

Changes in demand for global freight logistics have opened new opportunities for collaboration. It doesn’t take an expert on global trade or economics to see that America is beginning to export more and import less. This is good news for American business, but does present some unprecedented challenges in moving goods overseas.

    “...carriers don’t like to move cargo inland as they want their containers in the ports to save the cost of repositioning.” - Devin Burke, CEO, Universal Cargo Management, Inc.

Although most of the growth in shipping traffic is still bulk items, such as scrap, produce, lumber, rawhide, cotton, etc, this country is growing in exports of such items such as used vehicles, construction equipment, as well as new manufactured goods such as building materials, medical equipment, sporting goods, high endfurniture. You couple that fact with the weak dollar, an Obama administration pushing to “double our nation’s exports in 5 years”, a growing middle class Chinese population developing an acquired taste for goods “made in America”, and other aggressive trade policies between America and countries like South Africa and Australia you would have to see there is a growing trend in exports. So what we are experiencing on the logistics side of exports are a steady increase in space and equipment shortages for anything being shipped out of America. Therefore if you are an exporter you not only face a space problem, where you may have to wait 3-6 weeks to get on board a vessel, depending upon the port,you are also experiencing shortages of actual equipment, especially in interior cities. So you may have to wait 2-3 weeks before equipment arrives before the carrier will accept booking.

On the import side, while there has been a decline in volume because of the decline in the American consumer’s buying power, retail decline, weak dollar, unemployment and other factors that severely slowed down the amount of cargo coming into this country from Asia in the past 2 years, there exists strangely enough since the 4th quarter of last year a severe space problem on ocean freight carriers from Asia, especially China.

The Big Disconnect: Import / Export Challenges
Now most of us all know the cause of this space problem to be manipulated by the carriers themselves when they decided to dock many of their vessels in ports like Singapore.(If you fly into Singapore you will see an ocean of between 6-700vessels sitting there empty, it’s quite a sight). This was done to “save” the lives of carriers because of the billions they lost last year (I heard Maersk lost $2 bill, wow, they supposedly have never lost money, ever, but who knows with creative accounting what the truth is, but still, wow). Well this capacity constraint actually worked for the carriers, as if you are an importer you will know the freight rate shave gone up from $700/40 from China to the west coast during the summer of’09, to now most importers are looking at paying around $2500/40 this summer. But even with the increase in revenue for the carriers, they are cleverly withholding their vessels in order to continue the space crunch, so they can maintain their high ocean freight rates for inbound freight to the USA.

The Federal Maritime Commission is investigating this matter and urges anyone wishing to participate in these hearings or offer information relevant to the development of the record in this proceeding to contact her office at (202) 523-5715.

So, What Are We Looking At?
We have a shortage of equipment for exports, and a shortage of space because of too many containers coming into America ? So why the disconnect ? One obvious answer is the fact the carriers don’t like to move cargo inland as they want their containers in the ports to save the cost of repositioning. However if an importer in say, Shreveport , Louisiana cannot get space for cargo coming from Shanghai and now has to pay freight somewhere in the range of $4500 or more (up about$1300-1500 from a year ago) uses a carrier like Maersk, or MSC that also has an exporter customer in a nearby town in Northern Louisiana of lumber, waste paper,or cotton who cannot get equipment and space for their exports for 3-4 weeks, why doesn’t MSC or Maersk put these two needs together to solve each others' problem? It would seem to me that either the people running these carriers are too shortsighted, or maybe the cargo moving out of this country is just too far away and costly to match with the destinations of imported cargo, I don’t know for sure, but I would bet on the former.

Bottom Line
In the past, carriers essentially subsidized the inland distribution of containers; now, with some homework on the part of American businesses, collaboration with May 22, 2010 to save container distribution costs can be leveraged in negotiating for space on outbound ships.Universal Cargo Management, Inc. has over 25 years experience assisting customers and partners in freight logistics internationally and domestically.