We begin this month's ocean fast facts with a question:

During 2007, which United States port handled a combined ocean import / export total of 8.6 million TEUs (twenty-foot equivalent container units)?

1. The Port of Los Angeles
2. The Port of Toledo, Ohio
3. The Port of Norfolk / Hampton Roads Virginia
4. The Port of New York / New Jersey

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The general definition of a commercial invoice: A document identifying the seller and buyer of goods or services, identifying numbers such as invoice number, date, shipping date, mode of transport, delivery, payment terms and a complete listing and description of the goods or services being sold including prices, discounts and quantities. Definitions for customs purposes exist as well to define true transaction values of goods.

Source: Directory of International Trade, Handbook of the Global Community, 7th Edition; Edward G. Hinkelman, 2006.

For April, the "buzz'" word of the month is a very important document used when dealing with international freight transactions. Commercial invoices fulfill a vital role with customs clearance in virtually every country participating in international trade. It is imperative that the commercial invoices are completed for uninterrupted transportation.

Questions about commercial invoices should be directed to your local AIT representative, especially if you're a new importer or exporter.

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The shortage of containers in the United States nears critical levels, especially at USA mid-sections. Some carriers are already reporting equipment shortages at the following ports: New York, Norfolk and Charleston.

Along with the lack of ocean containers, additionally the container chassis supply has been impacted, which is typically readily available for ocean carriers and truckers alike. Carriers are already reporting they do not have booking availability until early May 2008 for Europe and Asia.

As a reminder, AIT ocean export customers should prepare for as much lead time prior to booking and shipping cargo; especially when sourcing single and multiple container shipments from such markets as Chicago, St. Louis, Kansas City, and Denver.

These intermodal markets are often 'demand' areas for ocean equipment. The empty 'turns' for importing occasionally are available fast enough to supply the export booking demands. To avoid delays, plan early to secure ocean container equipment. Contact AIT to assist in scheduling alternatives when your primary routing options no longer exist.

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General Rate Increases

There are several tradelanes that may experience a general rate increases (GRI) into April. To determine how the GRI will impact your freight, contact your AIT Representative. These levels are proposed, but not yet finalized by the carriers.

Increased Fuel Costs and Slower Vessel Speed!

AIT has been advised by several major ocean carriers about 'slowing down' their vessels while at sea. This practice appears to more common on the Trans-Pacific trade between Asia and the United States.

In some cases, carriers are slowing vessel speed to the point that transit time is being impacted up to one day in order to preserve fuel, and thus save on bunker costs. Be aware when booking sensitive cargo, the additional transit time can also affect those shipments.

Ocean Carriers Charging Container / Equipment Pick up Fees

As mentioned, many carriers are suffering from a serious shortage of containers in the USA; this is especially true from inland locations. Some carriers are implementing an export surcharge for equipment imbalance which will be applied to all inland point bookings.

For Example, Mediterranean Shipping Company (MSC) has announced the following charges for cargo:

The surcharge will be referred to as a PICK-UP FEE that will take effective on April 2nd 2008 (delivery at ramp).

Please note this rate will be added in addition to the intermodal charge and fuel surcharge. This surcharge will apply to all EXPORT moves from the following ramp locations (either Rail/Ramp or Rail/Motor moves):

Chicago, Cincinnati, Cleveland, Columbus, Houston Ramp, Louisville, New Orleans Ramp, Kansas City, Indianapolis, St. Louis, and St. Paul.

Hapag Lloyd has also announced similar surcharges.

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As of late March, customs workers in Brazil are striking with only 30% of the workforce operating. Anticipate delays for the clearance of shipments in Brazil. Additionally, customers are advised of the new customs laws, which take place April 1st. The law requires agent registration with port authorities on the master bill of lading for cargo clearing in Brazil.

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Alameda Corridor Surcharge (ACS) Advisory

As of January 1, 2008, the new ACS levels are: $19/$38/$39/$42 per 20'/40'/40'HC/45'. This is for all cargo transiting via intermodal rail corridors to and from the ports of Los Angeles and Long Beach.

Port of Los Angeles / Long Beach

1. Container Handling Fee coming in 2008: The fee is estimated to be $35 per-TEU or $70 per-FEU and the start date has not yet been announced.
2. The Port of Los Angeles / Long Beach has announced it will also add a Container Fee for Loaded Containers effective January 1, 2009. The proposed fee will be $15 per TEU.

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Currently, the post May 1, 2008 rates for Asia to USA ocean freight contracts have not been negotiated.

The Trans Pacific Maritime results, held in Long Beach California early this March, discussed the general softening import trends in the USA.

AIT will actively participate in the negotiations, which will be communicated as they become available. Aside from the proposed floating fuel surcharges, ocean rates ex Asia to the USA are anticipated to increase at a range of 3 to 5 percent.

ILWU and PMA Contract Discussions Underway: Contract discussions between the ILWU, representing the Longshoremen at 29 United States West Coast Ports and the PMA (Pacific Maritime Association) representing the ocean freight carriers are underway.

This positive sign reflects that both sides have undertaken discussions early to avoid a strike when the current labor contract expires on July 1, 2008.

It appears both sides want to avoid the significant delays that resulted from the strike that occurred during the last contract negation in 2002. At this point, it appears the PMA is clarifying issues on the ILWU demand list. Negotiations will resume on March 31st. More to follow on this topic further progressions take place.

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On behalf of the entire AIT Ocean Systems Team, thank you for your continued support. Spring has sprung and Peak Season is just around the corner, who can believe it?

One item forthcoming in the May 2008 AIT Ocean Systems Newsletter Edition: An Update on Exports!

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Boeing says shifting cargo from air to sea is not a sustainable strategy for shippers of high-end goods.

"While we will never come close to moving the volume of freight carried by (sea) vessels, we continue to outpace their growth every year," said Tom Crabtree, regional director of business strategy for Boeing Commercial Airplanes (BCA).

Sea-going traffic is more geographically concentrated, it's not as flexible to diverse points and a high proportion of container traffic is regional and not intercontinental, he said.

Overall, orders for new Boeing production freighters numbered 74, 81 and 83 for 2005, 2006 and 2007 respectively for a total 258 airplanes, about 14 per cent of total Boeing commercial airplane order value during that time.

"We've been on a great run with three consecutive years of record freighter orders," said Jim Edgar, regional director Cargo Marketing BCA.

"We've been laying the groundwork for a transformation that really takes off in 2008," said Edgar. "We began major assembly of the 777 Freighter in January and will move forward with the completion of assembly, flight test, certification and a fourth-quarter delivery of the first 777 Freighter to Air France, and we'll achieve critical design milestones for the 747-8 Freighter and the start of 747-8F production." These airplanes, he added, will be the key revenue generators for the air cargo industry "for years to come."

The International Air Transport Association (IATA) has called on the air cargo supply chain to coordinate efforts to drive an industry agenda for change that will improve customer service and competitiveness.

"Air cargo is a US$50 billion business that is losing competitiveness. World trade grew 7.5 percent last year and our growth forecast for this year is 4.0 per cent," said Giovanni Bisignani, IATA's director general and chief executive. He was speaking at the association's second World Annual Cargo Symposium attended by 900 air cargo industry leaders in Rome, Italy. "Our sea competitors are gaining market share with faster ships, lower prices and innovative solutions. And new capacity coming into the market - 200 to 300 wide bodies entering the market each year to 2011 - will put even greater pressure on yields. This is a tough business that is only getting tougher. The only way to succeed is to please the customer."

Source: Air Cargo e-News Weekly, March 6, 2008

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IATA claims it is in a unique position to lead change in the cargo industry. With operations in 72 countries, the IATA Cargo Accounts Settlement System (CASS) now handles US$21 billion annually.

"IATA is serious about air cargo. Our network grew by 60 percent in the last four years and we have aggressive plans to expand coverage and diversify services in 2008," said Bisignani.

Bisignani identified an air cargo supply chain agenda 'to please the customer' based on safety, security, quality, efficiency and the environment.

Safety: "Last year there were 16 cargo accidents - 16 percent of the industry total. This is down from the 25 percent recorded in 2006 but it is still not good enough. IOSA plays an important role. 136 airlines are on the IATA Operational Safety Audit (IOSA) registry but cargo is behind with only one airline on the registry. Our goal is to bring all carriers on board by the end of the year," said Bisignani.

Security: "Security is still a US$5.9 billion uncoordinated mess for the air transport industry. Our risk management capabilities are excellent but our stakeholders still want to treat air freight like baggage. It is not. Effective security must involve the entire logistics chain," said Bisignani. "To clean up this mess we need a coordinated effort across the supply chain. The Air Cargo Security Industry Forum, that brings together 27 industry associations, is key to influencing regulators with a common message and coordinated action. We are working on internationally recognized security accreditation standards and a security audit. This includes a global registry of secure supply chain operators, including known shipper details to be used by regulators and the supply chain."

Efficiency and Quality: "Shippers demand quality and efficiency. Cargo 2000 was established over a decade ago to simplify processes and implement effective quality standards from order to delivery. We simplified the supply chain process from 40 to 19 steps and developed common parameters for quality measurement. Now we need to move faster to increase Cargo 2000 participation and implementation. The key is leadership. The most successful Cargo 2000 members have dedicated quality managers to drive the program forward. It is time now to consider giving the process some teeth with an IATA quality audit based on Cargo 2000 standards," said Bisignani.

"Air cargo business processes belong to another age. It's time to modernize and drive paper from the business. E-freight is the answer to our customers' call for lower costs, improved reliability and more speed. Today, e-freight is a reality in six key locations covering 10 percent of cargo volumes. What have we achieved? First, we replaced 12 paper documents with electronic messages and a single point of data entry. More importantly, we have proved that e-freight can work. Our target for 2008 is to expand the benefits of e-freight to another 8 locations," said Bisignani. "But data quality is still an issue. One key benefit for e-freight is time. Fast track customs clearance with e-freight could save up to 24 hours per shipment. But we will only achieve that if data is consistently accurate."

Environment: "Environment is an issue the entire supply chain must address quickly and with a common goal - to achieve carbon neutral growth leading to a carbon-free future. Our first target is a 25 percent improvement in fuel efficiency by 2020. In the last two years, IATA's efforts in shortening routes, spreading best practice and improving operations saved 25 million tons of CO2 emissions," said Bisignani.

"Air cargo is a tough business. The entire value chain must be united to deliver critical solutions against aggressive targets. The priorities are clear: To provide safe and secure transport that is environmentally responsible with consistent quality and lower costs. The only way to do this is by working together with a common vision that meets customer expectations."

Source: Air Cargo e-News Weekly, March 6, 2008

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By John G. Wensveen

Review by Willem-Jan Zondag

This month, we feature a textbook on air transportation. Organizations like the Chicagoland Chamber of Commerce are working with the Mayor's office and local community colleges to create a curriculum for students that cover the transportation, warehousing and logistics field.

Much of what we do is based on hands-on person-to-person training. How, then, do we sustain the transportation industry - who trains the next generation? By working with local schools and industry-interested organizations, municipalities can create jobs and grow infrastructure with the proper training. Advancing that education requires text books that can be used as the basis of any course.

"Text books about civil aviation and air transportation are published rather frequently. John G. Wensveen has added a comprehensive that provides readers with valuable expert views of today's air transportation industry," writes Willem-Jan Zondag in his review of Air Transportation - A Management Perspective.

Source: Aerlines.com e-zine edition 40

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A very interesting "going green" initiative being lead by the United States Government's Environmental Protection Agency is know as the SmartWay Transport Partnership.

The SmartWay Transport program is defined on the website as "a voluntary partnership between various freight industry sectors and EPA that establishes incentives for fuel efficiency improvements and greenhouse gas emissions reductions."

By 2012, the initiative aims to reduce between 33 - 66 million metric tons of carbon dioxide (CO2) emissions and up to 200,000 tons of nitrogen oxide (NOx) emissions per year. Simultaneously, the initiative will result in fuel savings of up to 150 million barrels of oil annually.

The site lists three primary components of the program: creating partnerships, reducing all unnecessary engine idling, and increasing the efficiency and use of rail and inter-modal operations.

We all know that air transportation is only part of the door-to-door supply chain; as we look for efficiency with the air carriers we utilize, it is equally important that environmentally focused companies look at ground transportation as well. A key to this success is creating partnerships.

Creating Partnerships

Partnerships with companies and organizations are the foundation of the SmartWay Transport Program. EPA welcomes any company or organization that will improve the environmental performance of their freight operations. Key Partners are companies that ship products and the truck and rail companies that deliver these products. Partners commit to measure and improve the efficiency of their freight operations, using EPA-developed tools that quantify the benefits of a number of fuel-saving strategies.

This is a worthy program deserving consideration and full participation. The SmartWay Transport Partnership under EPA leadership brings like-minded companies together, each committed to do their part in protecting the environment for generations to come.

To learn more, please visit http://www.epa.gov/smartway/index.htm

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Beijing in northern China is the capital of the People's Republic of China (PRC). It is also known in English as Peking (English pronunciation). Beijing is also one of the four municipalities of the PRC, which are equivalent to provinces in China's administrative structure. Beijing Municipality borders Hebei Province to the north, west, south, and for a small section in the east, and Tianjin Municipality to the southeast.

Beijing is China's second largest city, after Shanghai. It is a major transportation hub, with dozens of railways, roads and motorways passing through the city. It is also the focal point of many international flights to China. Beijing is recognized as the political, educational, and cultural center of the People's Republic of China, while Shanghai and Hong Kong predominate in economic fields.

Beijing is one of the Four Great Ancient Capitals of China and will host the 2008 Summer Olympics.

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History

Beijing, or Peking, literally means "northern capital," in line with the common East Asian tradition whereby capital cities are explicitly named as such. Other cities similarly named include Nanjing, China, meaning "southern capital;" Tokyo, Japan, Hanoi, Vietnam, both meaning "eastern capital;" as well as Kyoto, Japan, and Seoul, Korea, both meaning simply "capital."

Peking is the name of the city according to Chinese Postal Map Romanization, and the traditional customary name for Beijing in English. The term Peking originated with French missionaries four hundred years ago.

The city has been renamed several times. The Communist Party of China reverted the name to Beijing (Peking) in 1949 again in part to emphasize that Beijing had returned to its role as China's capital. Beijing took its current shape, and the Ming-era city wall served as the Beijing city wall until modern times, when it was pulled down and the 2nd Ring Road was built in its place. It is believed that Beijing was the largest city in the world from 1425 to 1650 and from 1710 to 1825.

The Forbidden City was constructed (1406-1420), followed by the Temple of Heaven (1420), and numerous other construction projects. Tiananmen, which has become a state symbol of the People's Republic of China and is featured on its emblem, was burned down twice during the Ming Dynasty and the final reconstruction was carried out in 1651.

At the time of the founding of the People's Republic, Beijing Municipality consisted of just its urban area and immediate suburbs. The urban area was divided into many small districts inside what is now the 2nd Ring Road. Since then several surrounding counties have been incorporated into the Municipality, enlarging the limits of Beijing Municipality by many times and giving it its present shape. The Beijing city wall was torn down between 1965 and 1969 to make way for the construction of the 2nd Ring Road.

In recent years, the expansion of Beijing has also brought to the forefront some problems of urbanization, such as heavy traffic, poor air quality, the loss of historic neighborhoods, and significant influx of migrants from poorer regions of the country, especially rural areas.

Early 2005 saw the approval by government of a plan to finally stop the sprawling development of Beijing in all directions. Development of the Chinese capital would now proceed in two semicircular bands just outside of the city centre (both west and east) instead of being in concentric rings.

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Location & Climate

Beijing is situated at the northern tip of the roughly triangular North China Plain, which opens to the south and east of the city. Mountains to the north, northwest and west shield the city and northern China's agricultural heartland from the encroaching desert steppes. The northwestern part of the municipality, especially Yanqing County and Huairou District, are dominated by the Jundu Mountains, while the western part of the municipality is framed by the Xishan Mountains. The Great Wall of China, which stretches across the northern part of Beijing Municipality, made use of this rugged topography to defend against nomadic incursions from the steppes. Mount Dongling in the Xishan ranges and on the border with Hebei is the municipality's highest point, with an altitude of 2303 m. Major rivers flowing through the municipality include the Yongding River and the Chaobai River, part of the Hai River system, and flowing in a southerly direction. Beijing is also the northern terminus of the Grand Canal of China which was built across the North China Plain to Hangzhou. Miyun Reservoir, built on the upper reaches of the Chaobai River, is Beijing's largest reservoir, and crucial to its water supply.

The city's climate is a monsoon-influenced humid continental climate, characterized by hot, humid summers due to the East Asian monsoon, and harshly cold, windy, dry winters that reflect the influence of the vast Siberian anticyclone. Average temperatures in January are at around 19 to 24 °F, while average temperatures in July are at 77 to 79 °F. Highest temperature ever recorded is 42°C and lowest recorded is -27°C. Annual precipitation is over 600 mm, with 75% of that in summer.

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Economy

In 2006, Beijing's nominal GDP was 772.03 billion RMB (about 97 billion USD), a year-on-year growth of 12% from the previous year. Its GDP per capita was 49,505 RMB, an increase of 8.8% from the previous year and more than twice as much as in 2000. In 2005, Beijing's primary, secondary, and tertiary industries were worth 9.77 billion RMB, 210.05 billion RMB, and 461.63 billion RMB. In 2006, urban disposable income per capita was 19,978 Yuan, a real increase of 12.9% from the previous year. Per capita pure income of rural residents was 8,620 RMB, a real increase of 9.6%. Per capita disposable income of the 20% low-income residents increased 16.7%, 11.4 percentage points higher than the growth rate of the 20% high-income residents. The Engel's coefficient of Beijing's urban residents reached 31.8% in 2005 and that of the rural residents was 32.8%, declining 4.5 percentage points and 3.9 percentage points, respectively, compared with 2000.

Beijing's real estate and automobile sectors have continued to bloom in recent years. In 2005, a total of 28.032 million square meters of housing real estate was sold, for a total of 175.88 billion RMB. The total number of cars registered in Beijing in 2004 was 2,146,000, of which 1,540,000 were privately-owned (a year-on-year increase of 18.7%).

The development of Beijing continues to proceed at a rapid pace, and the vast expansion of Beijing has created a multitude of problems for the city. Beijing is known for its smog as well as the frequent "power-saving" programs instituted by the government. Citizens of Beijing as well as tourists frequently complain about the quality of the water supply and cost of the basic services such as electricity and natural gas. The major industrial areas outside of Beijing were ordered to clean their operations or leave the Beijing area in an effort to alleviate the smog that covers the city. Most factories, unable to update, have moved and relocated to other cities such as Xi'an, China.

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Air Transportion

Beijing's main airport is the Beijing Capital International Airport (PEK) near Shunyi, which is about 20 km northeast of Beijing city centre. Most domestic and nearly all international flights arrive and depart at Capital Airport. Capital Airport is the main hub for Air China. It is linked to central Beijing by the Airport Expressway and is a roughly 40-minute drive from the city centre during good traffic hours. In preparation for the 2008 Olympics, another expressway is being built to the Airport, as well as a light rail system.

Other airports in the city include Beijing Liangxiang Airport, Beijing Nanyuan Airport, Beijing Xijiao Airport, Beijing Shahe Airport and Beijing Badaling Airport. However, these are primarily for military use and less well-known to the public.

Source: Wikipedia

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The comment period for the proposed "10+2 rule" ended March 18th. CBP received hundreds of filings commenting the Notice of Proposed Rulemaking relating to 10+2. Many of the major private sector import organizations sent comments criticizing the NPRM and suggesting a wide range of alternatives.

The Nation Customs Brokers & Forwarders Association of America (NCBFAA) mentions the duplicative nature of the 10+2, security filing with existing programs, including the 24 Hour Rule, FDA Prior Notice Requirement, and Customs Entry.

The American Association of Importers and Exporters calls for CBP to withdraw the rulemaking in order to again evaluate the methods, processes, and benefits of the current approach.

For those who are interested in reviewing comments from the entire filed visit: http://www.regulations.gov/. Paste "USCBP-2007-0077" into the search field.

NCBFAA full comments:
http://www.regulations.gov/fdmspublic/component/main?
main=DocumentDetail&o=09000064803fbbf6

The American Association of Importers and Exporters full comments:
http://www.regulations.gov/fdmspublic/component/main?
main=DocumentDetail&o=09000064803fb4c4

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As previously noted, Customs Informed Compliance Publications are available at:

http://www.cbp.gov/xp/cgov/toolbox/legal/informed_compliance_pubs/

These topics cover a spectrum of issues. While not all publications are useful to everyone, these publications are available to remain compliant with Customs requirements.

Customs is constantly updating older publications and adding new ones to their site. Since the beginning of the year, almost two dozen publications have been reviewed, revised, and/or added to the list.

These topics include: Caviar, Classification & Marking of Watches & Clocks, Buying & Selling Commissions, Agricultural Actual Use Provisions, Household Articles of Base Metal, and Classifications and Entry Requirements of Alcoholic Beverages & Spirits.

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The process for amending an entry prior to liquidation is the PEA. Importers should be aware that the entries for their merchandise are not finalized until Customs liquidates the entry. For most entries, this will occur within one year from the date of entry (usually about 10 months). If an error or omission on the entry occurs, the entry can be amended by filing a protest with Customs within 90 days after the liquidation date. The PEA is a less formal procedure, and since it can be filed any time up to two weeks before liquidation, it can greatly decrease the waiting time for potential Customs refunds.

Customs has recently updated their PEAs FAQ:
http://www.cbp.gov/xp/cgov/import/cargo_summary/general_pea/pea_faqs.xml.

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Nearly one hundred Longshore Caucus delegates voted on February 8th to support a resolution calling for an eight hour "stop-work" meeting during the dayshift on Thursday, May 1st. This action would be a protest calling for the immediate and safe return of U.S. troops from Iraq. It would take place in California, Oregon and Washington ports.

According to a release from Long Beach Press-Telegram on March 14th, dockworkers plan to stop working for eight hours during the May 1st dayshift by invoking a clause to their contract that allows for a monthly "stop-work" membership meeting.

Marine terminal operators claim the proposal violates the clause, because it would occur during the busy day shift.

At last report, representatives of the International Longshore and Warehouse Union were reviewing their options.

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Located in Houston, Texas, AIT is proud to highlight the energy division as a growing vertical market. Energy is an exciting and dynamic commodity with a strong focus on project cargo capabilities and customer service. The goal of the division: to identify customer needs and operational requirements, while proactively reacting throughout the supply chain with creative transportation solutions.

A majority of 2007 was spent building AIT's name in the marketplace, and establishing a solid and competitive reputation. During that time, a level of successes was reached by establishing a diverse customer base for the division.

A sizeable investment is being devoted to further expanding the division, especially in with the C2C WMS (Warehouse Management System). This system contains distribution models, particular tracking needs and location management, which is imperative for securing additional global targets.

In a global world, language presents tall barriers. However, Japanese, Spanish, Russian, and German are fluent languages at the Houston office.

The energy market is exciting and offers tremendous opportunity. The expertise of the Houston office extends across the nation to all AIT offices. As a resource, www.rigzone.com is a reliable source to learn about drilling as well as active companies in your area. Documents, detailing the markets and clients, are available upon request by contacting the Energy Division.

Introducing the Energy Division:

Jeff Caruthers - Business Development Manager
With roughly 20 years in the oilfield, Jeff began with Barton Valve as a valve/wellhead technician. He concluded with Diamond Offshore Drilling as the Materials & Logistics Manager. While working in 23 countries around the world, Jeff and has extended knowledge of equipment, as well as international shipping facets.

Jason Hakala - Operations Manager
With 12 years in the Special Forces Air Force, Jason ran the Diamond account alongside Jeff Caruthers. He also handled Varco, National Oilwell, and Expro. Jason has comprehensive understanding of the products being transported and customer expectations. Jason's expertise extends to AIT's C2C customer technology.

Bob McKenzie - Energy Sales
Bob's previous job was with Fluid Systems, where his entire career was spent in oilfield sales and consulting. An excellent source of knowledge, Bob's expertise extends to oilfield, mining and refinery. Fun fact: Bob was a U.S. Navy tennis champion.

Richard Hakala - Operations
Richard, a retired Air Force Officer, is an excellent resource for C2C customer technology and international shipping. Overseeing the Expro account, his responsibilities extend to the onsite employee at Clarks Packing in Houston. He also has handled air charters and actually accompanies an Antonov into Baku. Fun Fact: Richard Speaks fluent Russian.

The Houston staff extends to include Antonio Alvarez, Rita Gray and Cindy Nevares in operations along with Josh Mell and James Ruberti in sales.

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