NRF Urges Expedited West Coast Labor Talks

port of oaklandWashington, DC – The world’s largest retail trade association is urging both maritime management and the union representing dockworkers at US West Coast ports to “expedite pending contract negotiations and reach agreement on a new deal well in advance of the expiration of the current contract this summer.”

According to the National Retail Federation (NRF), speeded-up talks would “strengthen the supply chain and provide shippers and retailers the certainty they need to utilize the West Coast ports” during the critical holiday shipping period, which begins in July.

NRF President and CEO Matthew Shay voiced the organization’s concerns in a letter to the International Longshore and Warehouse Union (ILWU) and the Pacific Maritime Association (PMA), which currently plan to start negotiations in mid-May.

“We urge you to begin contract negotiations now and to attempt to reach agreement on a new contract before the June 30 expiration,” he wrote. “These negotiations are important to all of the import and export and related industries who rely on these ports to move the nation’s commerce.”

In its letter, NRF urged the union and management to publicly commit to remaining at the negotiating table leading up to the June 30 contract deadline and to maintain service at the ports by continuing to negotiate even after the contract concludes.

“We would further ask that you issue a statement committing to the commencement of meaningful negotiations now, and to commit to continue negotiating and working without interruption or reduced productivity even if negotiations extend beyond the June 30th contract expiration,” Shay said.

Both the ILWU and the PMA, he added, “must recognize their role in the global economy and the need to ensure predictability and reliability for the many diverse stakeholders who rely on the ports.”

The pending contract covers nearly 14,000 ILWU jobs at 29 containerized ports in California, Oregon and Washington.

A successful contract negotiation is of critical interest to the NRF as a majority of imported retail goods are shipped through West Coast terminals and gates.

According to NRF’s Global Port Tracker report, the major ports along the US West Coast – Los Angeles, Long Beach, Oakland, Portland, Seattle and Tacoma – handled 11.2 million cargo containers in 2013, or 69 percent of the total at US retail container ports followed by the report.

Given the importance of the West Coast ports, retailers have already begun to develop alternative plans to ensure the proper flow of holiday merchandise.

“NRF’s members, as well as other stakeholders, have already begun contingency planning to ensure their cargo does not get caught in potential disruptions,” said Shay. “Any kind of disruption at the ports would add costly delays to our members’ supply chains and other industries relying on US West Coast ports, and it likely further threatens the fragile economic recovery.”

The last major supply chain disruption to affect the entire West Coast took place in the fall of 2002, when management locked out dockworkers for 10 days.

That prolonged work stoppage, which was ultimately stopped when President George W. Bush invoked the Taft-Hartley Act, significantly impacted the global supply chain and cost the economy between $500 million and $2 billion a day.



UP’s New US-Mexico Border Intermodal Facility

unionpacificOmaha, NE – The Union Pacific has begun operations at its new intermodal rail facility in southern New Mexico, near to both the US-Mexico border and the key rail hub at El Paso, Texas.

Operations at the new terminal at Santa Teresa will focus on the transfer of cargo between trains and trucks, as well as for refueling engines and changing train crews.

According to press reports, the railroad conducted a “soft opening” of the new terminal with operations gradually ramping up to an official “hard opening” in late May.

The facility is on a 2,200 acre tract of land near the border. Only about half of the land is now being used with the other half slated for future expansion as needs are expected to increase, the rail carriers said.

Two mainline tracks heading east and west splay into seven tracks for fueling, oil changes and inspections. In an adjacent area of the sprawling hub, cranes are positioned to lift containers from semi-trailer trucks onto the rail cars.

With the railroad beginning operations, ancillary businesses have followed. Those include Twin Cities Services, which provides logistics services to businesses transporting containers from truck to rail to ship.

“Our decision to move is based on our clientele,” said Ed Hazelton, who is in the processing of transferring his Twin Cities operations, including 17 employees, to Santa Teresa from El Paso. “They want to be by the railroad.”

New Mexico officials consider the facility a major economic-development achievement.

The facility’s opening represents a major step toward making Santa Teresa “the inland port of choice in the Americas,” said Jon Barela, secretary of the state Economic Development Department.

While the Santa Teresa hub is about 800 miles from the seaport of Long Beach, Calif., it could lure logistics businesses from the West Coast, said Davin Lopez, chief executive of the Mesilla Valley Economic Development Alliance.

“Union Pacific has always looked at this as an inland port,” Lopez said. “We have an opportunity to relieve congestion at the Long Beach and Los Angeles ports.”



Eligibility Concerns Voiced Over Korea-US FTA

uskoreaftaMiami, FL – Just as the two year anniversary of the implementation of the Korea-US Free Trade Agreement passes, importers are reportedly voicing concerns that the US government may be ramping up its verification reviews, requiring importers to produce extensive documentation proving that goods imported under the agreement are eligible for FTA benefits.

“We’ve seen a definite spike in inquiries from our clients,” says Larry Ordet with the law firm of Sandler, travis & Rosenberg in Miami.

According to Ordet, importers “are reporting an increase in Customs’ requests for information and are anticipating notifications of more intense verification reviews.”

The US-Korea Free Trade Agreement, often referred to as KORUS FTA, took effect on March 15, 2012.

The agreement mandated that the tariffs on almost 80 percent of two-way trade in consumer and industrial products be eliminated as of that date with another 15 percent becoming duty free by January 1, 2016.

A few tariffs will remain in place until 2021, with some being phased out in equal annual stages over either five years or 10 years, and others remaining at their base levels for several years until being eliminated all at once or in annual stages.

“While taking advantage of the KORUS FTA can be a great advantage for global traders, the importance of ensuring that the rules for qualification are followed cannot be overemphasized,” said Ordet.

The time to get ready for a verification review, he cautions, “is before the government comes knocking at your door.”





The “Swiftest” Concert Ticket Sell-Out Ever in China

swiftShanghai, China – Marking the fastest-ever ticket sale in China’s history, Taylor Swift recently sold out Shanghai’s Mercedes-Benz Arena in only one minute.

The record-breaking sale came as a result of Swift’s announcement that she would be taking her “RED Tour” to Asia this summer. Six other Asian dates also sold out in record time, according to media reports. The RED Tour is being promoted by AEG Live Asia.

Last year, the North American portion of Taylor’s The RED Tour played to more than 1.36 million fans over 66 shows in 47 cities in 29 states and 3 Canadian provinces spanning 6 months.

Also last year, the tour went ‘down under,’ performing sold out stadium shows in Australia and New Zealand, becoming the first solo female artist in twenty years to undertake a national stadium concert tour of Australia. The tour has already visited Europe for six sold-out shows in 2014.

Taylor Swift is a seven-time Grammy winner and is the youngest artist to be awarded the Grammy Award for ‘Album of the Year.” She is the No. 1 digital music artist of all time, the only female artist in music history to twice have an album hit the 1 million first-week sales figure, and is the first artist since the Beatles to log six or more weeks at #1 with three consecutive studio albums.

Her album RED, released just over a year ago, has sold more than 6 million copies worldwide to date, including more than 1.2 million copies in the US in its first week, scoring the highest first-week sales debut of any album in over a decade.



Lockheed Martin Expands Presence Into Israel

lockheedBe’er Sheva, Israel – Lockheed Martin Chairman, President and CEO Marillyn Hewson has officially opened a representative office in Israel to support the defense contractor’s growing presence in that region.

The new office “further demonstrates the corporation’s commitment to supporting the Israeli Defense Force and their “Move to the South” campaign,” the company said.

Former Israeli Air Force Brig. Gen. Shelly Gotman was recently appointed as Managing Director – Israel for the company’s Information Systems & Global Solutions (IS&GS) business and will be based out of the new office.

“We are investing here and building our local team to ensure we have the resources required to support our valued customers and trusted partners in Israel,” said Hewson.

“With the opening of this office and the strategic investments being made by the IDF it is clear that Be’er Sheva is on its way to becoming the Silicon Valley of Israel,” she said.

Locating the company’s operations in the capital of the Negev positions the company “to work closely with our Israeli partners and stand ready to: accelerate project execution, reduce program risk and share our technical expertise by training and developing in-country talent,” she said.

Lockheed Martin’s IS&GS business has been a major provider of information technology solutions and services to the US government for the past 19 years and has been growing its presence in major international markets.

The company’s current IS&GS customers include NATO, the  British air traffic management organization NATS, the Australian Tax office, and the UK Ministry of Justice.



20 Millionth Honda Rolls Off the Assembly Line

Honda 25 YearsTorrance, CA – Honda Motor Co. achieved a major milestone when its 20 millionth vehicle built in the US recently rolled off the assembly line at its plant in Marysville, Ohio.

The Marysville plant was Honda’s first auto plant in the US and the first US-made Honda Accord was produced there in November 1982.

Tokyo-headquartered Honda has invested more than $1.6 billion in the operations at Marysville and its three other auto assembly plants in Indiana, Alabama and Ohio over the past three years to expand their production output and implement new technologies and manufacturing systems.

The company also produces engines in Lincoln, Alabama, and Anna, Ohio, as well as automatic transmissions in Russells Point, Ohio, and Tallapoosa, GA, to supply to its four auto manufacturing plants.

All four assembly plants contributed to the production of the 20 million vehicles, which include 11 models of cars, trucks and SUVs.

Annual production at the four US plants reached 1,309,917 units last year, a record high and a 7.4 percent improvement over 2012.

Honda also manufactured 23.77 million automobile engines and 18.64 million transmissions at its US facilities in 2013.



GSP Trade Aid for Ukraine Sought on Capitol Hill

Flag_of_Ukraine_(clear)Washington, DC – Several key US lawmakers are conferring with the White House to discuss reviving the lapsed Generalized System of Preferences (GSP) program in an effort to aid Ukraine.

The Senate Finance Committee, which deals with trade issues, is reportedly discussing renewing the program, which lawmakers let expire at the end of last July after failing to find a way to pay for its extension.

The GSP is a program that permits World Trade Organization regulations to be circumvented by reducing or complete eliminating the tariffs on selected imported goods from ‘developing’ countries, including Ukraine, in an effort to assist in their economic growth and competitive position in the global economy.

President Obama signed a bill into law on April 3 that provides $1 billion in loan guarantees and $150 million in direct assistance to the government in Kiev.

Several weeks ago, US Trade Representative Michael Froman has endorsed renewal of the program as a way to provide further assistance to Ukraine, after Russia annexed the nation’s Crimea region in late March. At a recent House Ways and Means Committee hearing in Washington, he stated that renewal of the GSP program “would benefit Ukraine immediately.”

US imports from Ukraine declined 23 percent from $1.3 billion in 2012, the last full year the GSP program was in effect, to about $1 billion 2013, according to Commerce Department data.

Total US trade in merchandise with Ukraine last year was $3 billion, less than 1 percent of the US total with the rest of the world.

A delegation from Ukraine visited Washington last weekend to participate in semi-annual meetings of the World Bank and the International Monetary Fund.



US, Japan in Critical Transpacific Trade Talks

japanWashington, DC – US Trade Representative Michael Froman has traveled to Japan to meet with top-level officials in an effort to persuade Tokyo to increase access to the country’s agriculture and auto markets.

Froman believes that Japan lowering its trade barriers would open the way for a deal on the Trans-Pacific Partnership (TPP), a proposed 12-nation trade pact that would significantly impact the flow of two-way trade between Asia and North America.

The negotiation to forge the TPP are in their fifth year and have bogged down over what the US feels is Japan’s intransigence over the market access issue. The stalemate is critical as the US and Japanese economies dominate the group, which encompasses one-third of global imports and exports.

The US wants Japan to open its rice, beef and pork, dairy and sugar sectors, while the Japanese have countered, demanding that the US must produce a timetable on its promise to eliminate its import tariffs of 2.5 percent on passenger cars and 25 percent on light trucks.

The US had hoped to complete the TPP by the end of last year.

A centerpiece of US President Barack Obama’s push to expand the US trade presence in Asia, the TPP includes Canada, Mexico, New Zealand, Malaysia and several other Asian countries.

The meeting in Tokyo comes on the heels of the announcement of a basic “economic partnership agreement” between Australia and Japan that will increase bi-lateral investment and substantially reduce the import tariffs on a broad menu of products moving between the two countries.

At the announcement of the new pact, Australian and Japanese officials stressed forging closer security ties as Japan seeks tighter relations with regional partners.

Both countries have reportedly agreed to start talks on cooperation in defense technology and equipment, following Japan’s recent overhaul of a decades-old ban on arms exports.



Los Angeles, Long Beach Port Merger Proposed

Container Ship Cargo, Port Elizabeth, NJ Phil DeggingerLos Angeles, CA – A recommendation by the Los Angeles 2020 Commission to merge the operations of the ports of Los Angeles and Long Beach into a single, massive “megaport” has been rejected out-of-hand by Long Beach city and port officials.

“I find it … mysterious and condescending and disrespectful that they didn’t have the courtesy to call the Port of Long Beach or the mayor of Long Beach before they issued this recommendation,” Long Beach Mayor Bob Foster said in an interview with the Long Beach Press-Telegram.

“It’s an awful idea,” he said. “The two ports have been competing for over a hundred years to the benefit of customers. … Why would we give up our port?”

Long Beach Board of Harbor Commissioners President Doug Drummond said he had asked to speak on the issue “but was never given an opportunity to do so.”

Combining the two ports, said Rich Dines, vice president of the Long Beach harbor board, “is one of the worst ideas I have ever heard of,” said, adding that the competition between the two busiest containers ports in the country “is healthy and necessary.

If the two ports “were on the same team, that team would become complacent and then really begin to lose market share,” he said.

The competitive nature of the two ports – literally divided by a line on the map – “makes each other better,” said Dines. “The collaboration is always going to be there on clean air, clean water, port security, port energy. That’s all good. But we’re two separate businesses.”

While the Port of Los Angeles hasn’t endorsed the proposal, it’s “willing to sit down and see if there’s additional collaborative efforts that would be beneficial to the ports and the region,” said port spokesman Philip Sanfield in an interview on a local radio station.

The report suggests creation of a joint port authority similar to the Port Authority of New York-New Jersey, where both cities have an equal say in future development.

It also cited the 2008 formation of Port Metro Vancouver and the decision earlier this year by the Puget Sound ports of Seattle and Tacoma to share information about operations, facilities and rates.

“Maritime trade is about to get a lot more complex — and competitive,” the report said. “We should be competing with ports in other regions, not with each other.”

The Port of Los Angeles handled 7.9 million TEUs (20-foot equivalent units) last year, down slightly from the 8.1 million that passed through its terminals in 2012. Long Beach, on the other hand, saw a slight improvement in its container volume in 2013 with 6.7 million “cans” moving across its docks, up from the 6.0 million the previous calendar year.

Combined, the ports would be the largest port complex in the Americas and rank as the fifth largest in the world.

The L.A. 2020 Commission was created last year by the Los Angeles City Council to identify the chronic economic and growth issues facing the sprawling Los Angeles region and make recommendations on ways to address them.

The 13-member body is headed by former US Secretary of Commerce Mickey Kantor and is made up of a variety of representatives from the business, labor, political leaders, economic development and non-profit communities.





High-Tech Exports Expected to Soar Through 2030: HSBC

high_tech_trade_onpageNew York, NY – High-tech exports will grow faster than other goods over the next 15 years, as China moves away from its role as a low cost manufacturing center and into making local products, according to research from banking giant HSBC.

By 2030, high-tech goods will comprise more than 25 percent of trade, compared to 22 percent in 2013, says HSBC in its most recent global trade report.

The report asserts that the worth of global goods trade will go up 8 percent annually from 2014 through 2030, while high tech goods will surge 9 percent a year over the same period.

HSBC said much of the future increase in high-tech trade would be driven by the internationalization of supply chains, with parts for high-tech products crisscrossing national borders, but Asian firms would also snare market share from Western competitors.

By 2030, the report said, China will remain the high-tech giant, accounting for more than half the high-tech trade. Hong Kong will rank second, and the United States will rank third, as they do today, but both countries will have a lower market share.

HSBC also predicts that Korea will displace Singapore as the fourth-largest high-tech goods exporter.

The US and the European Union are also pushing China to resume talks on expanding a list of high-tech products covered by a 16-year-old pact that eliminated duties on products including personal computers, laptops and telephones.

The bank report showed China accounted for 36.5 percent of high-tech goods exports in 2013, followed by Hong Kong at 13 percent and the US in third place at 9.6 percent.

In 2000, the US was the world’s biggest tech exporter with a market share of 29.2 percent.