b'AUGUST 23 - SEPTEMBER 5, 2021NORTH AMERICAS TRANSPORTATION & LOGISTICS NEWSPAPER 15WSC statement on the framework for the introduced Ocean Shipping Reform Act of 2021Abillwasintroducedinpenalty,toguaranteetheper- outresponsibilitiesandconse-the U.S. House of Representa- formanceofotherpartiesoverquencesfornonperformance tiveslastweekthatseekstowhom they have no controlforbyallparties.Thelegislation amendtheU.S.ShippingActinstancebyputtingtheburdendoes not take that even-handed asameansofattemptingtoon ocean carriers to ensure chas- approach.Justbecausethe addresssupplychainconges- sis, trucks and rail cars are avail- markethastemporarilyturned tion resulting from the conflu- able from third party providers. under stress from unprecedented enceofrecordU.S.consumerU.S.consumerandbusiness andbusinessimportdemand,i t isa lsoi nfusEdw itH import demand does not warrant coupled with disruptions result- d uEp RocEssv iolations legislatively creating a commer-ingfromtheCOVID-19pan- Forinstance,onceagaincial playing field that is unlevel demic. While text of legislationunderthreatofpenalty,itand which will persist for manyMaersk green shipping plan runs is not yet available, a Frame- requires ocean carriers to makeyears if enacted.work outlining the legislationcertificationsoffactonwhyFinally,Congressshouldup against scarce cooking oilhas been shared with memberscustomers do not return equip- pause and reflect on the impacts of the media. The legislation ismentontime,insituationsinontradepartnerswhomthisA.P.MollerMaersk A/Ssisk A/S. Demand for the product baseduponaflawedDiscus- which the facts are not, and inlegislation,ifenacted,wouldeffortstobecomecarbon-neu- is rising exponentially from a sion Draft that was a wholesalemostcasescannotbeknownincentivizetoenactsimilartralfaceanunusualhurdle:low base, but a bizarre hurdle incorporationofunworkable,tothecarriers.Suchprovi- protectivelegislativeandreg- thereisntenoughusedcook- stands in the way, Skou said.unnecessaryandduplicativesionswillnotresultinsupplyulatoryframeworksintheiring oil to make the biofuel thatPrices for used cooking oil proposalssome of which con- chainimprovements,preciselycountries.Startingaprotec- powers the vessels. arehigherthanfornewcook-tain serious due process of lawbecause they charge parties withtionistracetothebottominThebiofuelissourceding oil in Europe because of the concernsthatwassuggesteddoing the impossible. theregulationofinternationalfrom used cooking oil, but thehigh demand. Maersk cant use by certain shippers and agricul- Supplychainparticipantsoceantransportationisnotaproblem is that the world doesnttheediblevariantbecauseits tural exporter interests. includingports,carriers,labor,winningstrategyfortheU.S.eatenoughfrenchfries,saidcategorized as food and not bio-The Framework carries mostmarine terminal operators, rail,economy.ForU.S.consum- ChiefExecutiveOfficerSorenfuel, the CEO said.of the Discussion Drafts flawstruckers,chassisprovidersanders and businesses, todays billSkou. We cant keep scaling it.Maerskconsumesabout forwardintotodayslegisla- shippersarecollaborativelyrunsaseriousriskofmakingIf our growth rates continue, we12milliontonsofmarineoil tion, and thus warrants an initialworking to find operational solu- transportationcontractslesswill run out of cooking oil in oneperyear,roughlyequaltoall response.Themostsignificanttionstoincreaseefficiencyandflexible,slowingcargoveloc- or two years. the oil produced in the world in oftheseflawsare: Thesug- cargo velocity. ity,andmakingallimportedStill, Skou said the Copen- one day. In its plan to go green, gestionthatoceancarriersareTheseoperationalsolu- andexportedgoodsmorehagen-based carrier, which con- Maerskisusingbiofuelsnow solelyresponsibleforthecur- tionshavebornsomesuccess.expensive. This is because riskstrolsafleetofmorethan700and going forward plans to use rent supply chain congestion isNotwithstandingtheongoingcannotbeefficientlyappor- vessels,isdoneorderingshipsmorelow-emissionshipsthat simply untrue. congestion,U.S.importcargotioned by parties if there are toothatonlyrunonfossilfuel.run on green methanol. First, a suggestion that oceanis moving at historic levels, andmany restraints on freedom ofMaerskhaspledgedtocutitsEarlierthisyear,Maersk carriersaresolelyresponsibleU.S. government statistics indi- contract, and lack of efficiencyowncarbonemissionstonetorderedtheworldsfirstcon-for the current supply chain con- cate that agricultural exports aretranslatesintoadditionalcost.zero by 2050. About 90% of thetainershipthatdoesntemit gestion; moving at or near pre-pandemic,WSCinsteadurgesCongressgoods across the globe are trans- carbon.Thevessel,dueforSecond, the legislation is infusedand in some cases record levels. toallowcommercialsolutionsported by the shipping industry,delivery in mid-2023, has dual-with fundamental unfairness;Todays legislation ignoresandmarketforcestomitigatewith Maersk accounting for one- enginetechnologyenablingit Third,thebillignoresthethese facts, and instead seeks toand balance the current supplyfifth of that total. The industryto sail on either carbon-neutral factthatallsupplychainpar- have the government step in andchainstress,withtheFederalis responsible for roughly 2% ofmethanolortraditionalvery ticipantsareworkingcollab- tilt the market in favor of ship- MaritimeCommissionusingthe worlds CO2 emissions. low-sulfur fuel oil.orativelytofindsolutionstopersincommercialdisputes.its ample existing authority asMaersk uses biofuel in someThere will be more invest-todays problems. Ifthegovernmentisgoingtoabackstoptoinvestigateandvessels for clients who want toments in the coming quarters, Thesupplychainconges- stepin,itmustbetoassureenforceagainstanyunreason- cut emissions, including clothingSkou said in response to ques-tion is widespread. Every link infairness for all parties, and thatablepracticesaprocessthatretailerHennes&MauritzABtions. We will order some ships the supply chainfrom marinemeansthatthelawmustspellthe FMC has already initiated. and drug company Novo Nord- before the end of the year.terminals, to truckers, to rail cars andwarehousesisundertre-mendous strain. It is unrealistic, inequitable,andunproductive totrytoaddressthesesupply chain-wide challenges by regu-lating only one class of supply chain participantsocean carri-ers. It is doubtful that regulating allsupplychainactorsports, marineterminals,labor,truck-ers,railroads,warehouse operatorswould have any dis-cernible positive impact on the current supply chain challenges. What is crystal clear is that reg-ulating only ocean carriersor any other single class of supply chainproviderisdoomed tofail.Thisapproachwillnot improvesupplychainperfor-mance,anditrisksundermin-ingtheregulatoryandmarket structurethathasservedthe nations international trade well for many decades. It is possible to make the situation worse, and this bill would do just that.t HEl Egislation isi nfusEd customs brokers&freight forwardersw itHf undamEntalu nfaiRnEss www . jfmoran.com: 800.944.1041The bill would require ocean carriers,underthethreatof'