FTZ’ine September 2023
August 30, 2023
FTZ’ine November 2023
October 31, 2023
Back In Business
Bet you didn’t think that was going to happen.
With only hours left before Uncle Sam’s spending authority expired, Speaker of the House Kevin McCarthy reached a deal with Democrats to keep the government in business for six more weeks. Still no federal budget, and more negotiation will be needed before the Thanksgiving holiday to avoid a repeat of the shutdown threat.
The impact of drought conditions on global trade is expanding. The Panama Canal situation continues to worsen, and major inland waterways in the U.S., Europe, and Asia are also experiencing flow restrictions which will drive up supply chain costs.
The U.S. stock market had a bad month in September. Inflation concerns persist despite rising interest rates, causing stocks to give back most of their summer gains. Downbeat economic news from China clouds the global economic outlook, and the war in Ukraine still seems nowhere close to a resolution.
Top Story: Shutdown Averted, DC Style
Washington and the economy in the DC area sidestepped a disaster after Congress passed a stopgap funding measure to kick off the new government fiscal year.
After weeks of fruitless negotiations within the Republican caucus, House Speaker Kevin McCarthy announced a compromise proposal with Democrats, a move that surprised many and enraged a few. That deal passed the House 335 to 91 with more Democrats voting for it than Republicans. The Senate then quickly approved it by 88 to 9, and President Biden signed the bill late Saturday night.
The bill will keep the government open through November 17 and includes natural disaster aid but not additional funding for Ukraine or border security.
The stopgap bill originally included funding for Ukraine, but the funds were dropped after some conservatives raised objections during negotiations. Democratic Colorado Sen. Michael Bennet briefly held up the vote on objections over the lack of funding for the war effort. Bipartisan members of Senate leadership released a joint statement committing to vote on further funding for Ukraine aid "in the coming weeks."
The bill is not a budget for the new fiscal year, and will only fund the government for 45 days. Congress does not like to be late for Thanksgiving Dinner, so the Speaker may be banking on the calendar to ensure Congress is completely engaged in working out a complete spending plan to avoid a delay to the start of holiday recess.
The rapid Congressional action wasn’t just a fire drill figuratively. There was a real one too.
Representative Jamaal Bowman of New York pulled a fire alarm in the Cannon House Office Building on Saturday as his Democratic party was trying to delay a vote on the stopgap bill, prompting an evacuation of the building and investigations by the Capitol Police and the House Administration Committee.
The alarm was triggered at the same time that leary House Democrats were stalling a vote on the bill that had just been unveiled minutes earlier. Representative Bowman issued a quick statement that the two events were not related and that the fire alarm was an accident he regretted.
Politics makes strange bedfellows. The decision by McCarthy to negotiate with Democrats instead of the hardliners in his own party will put his position as House Speaker at risk.
“If somebody wants to make a motion against me, bring it,” McCarthy told CNN’s Manu Raju at a news conference. “There has to be an adult in the room.”
Tech Tip: Be Sure To Update Your ACE Tool URLs
Did you know that CBP has a number of ACE tools that you can access through the web, without logging into ACE itself? These web pages can be a faster way to access basic and reference information regarding imports. The following applications will transition to a new URL:
• AD/CVD URL: https://trade.cbp.dhs.gov/ace/adcvd/adcvd-public/
• Liquidation Bulletin URL: https://trade.cbp.dhs.gov/ace/liquidation/LBNotice/
• ACE Dashboard URL: https://trade.cbp.dhs.gov/ace/dashboard/public/
• Vessel Confidentiality URL: https://trade.cbp.dhs.gov/aes/external-service/reference-data/
• AES Reference Data URL: https://trade.cbp.dhs.gov/aes/vessel-confidentiality-web/
Be aware of the key dates for the change. From September 19th to October 9th of this year, both the current URL and new URL for each application will be available and supported. From October 10th, the current URL will be replaced with a redirect to the new URL. Finally, after December 12, 2023, only the new URL listed above will be available.
If you have specific questions or comments about ACE and ACE functionality, ask us at Info@iscm.co.
China Export Drop Clouds Global Economic Picture
The Chinese government reported last month that the value of China’s exports to the world dropped 8.8 percent in August from a year earlier, marking the fourth month in a row of declining sales.
At the same time, imports fell 7.3 percent, China’s General Administration of Customs said, reflected a steady downturn in the world’s #2 economy.
China’s total trade surplus fell to $68.36 billion from $80.6 billion in July. China relies heavily trade surpluses to support jobs, which is now particularly important as youth unemployment has surged in the country.
Growth in China has lagged since the spring as home prices have suffered, shaking consumer and investor confidence.
While the numbers themselves were not encouraging, economists had expected the data to be worse, and the figures were actually an improvement from the month before.
Therefore it is possible that the Chinese economy is finding the bottom of its difficulties. Further, exports of some products began to stabilize: Overseas sales of household appliances like refrigerators and washing machines rose 11.4 percent in August, though both had fallen in July.
Imports of agricultural products (China relies heavily on food from abroad as it improves the diet of its citizens) were down 7.9 percent from a year earlier, while imports of crude oil were up half a percentage point.
From another perspective, while China’s exports have been weak this year, they are coming down from historic levels achieved during the pandemic.
Drought Woes Continue to Hamper Global Trade
From the Mississippi Delta to Europe, Asia and Panama, drought conditions around the world are hampering transportation via inland waterways.
The Mississippi River is used to transport more than 500 million tons of freight a year, but last year record low water levels were estimated to have cost $20B in additional supply chain costs on alternate lanes. The lack of fresh water in the river has now gotten to the point that tidal flows threaten to put salt from the Gulf of Mexico into the water supply for the City of New Orleans.
In China, parts of the Yangtze River, whose surrounding provinces produce 45% of the country's economic output, were closed to ships because water levels were more than 50% below average.
Europe typically transports more than 300 million tons of goods a year by riverboats on the Rhine River, which flows for almost 800 miles from Switzerland to the Netherlands. Record low water levels there mean some vessels are able to carry just 25% of their usual load.
Riverboat cargo ranges from temperature-sensitive fresh produce and pharmaceuticals, to raw materials like chemicals, and car and machinery parts.
In the wake of the drought, rail and truck routes had to be used to make up the missing capacity to keep European industrial centers connected to the ports of Rotterdam and Antwerp.
Rather than swapping to land transport, one designer and operator of cargo riverboats, Germany's HGK, is now introducing vessels that can continue to sail in very shallow waters.
"Our shallow-water tanker, Synthese 18, can transport 300 tons of cargo in water just over 3 feet deep," says Anke Bestmann, managing director HGK Gas Shipping.
Closer to home, the Panama Canal Authority announced last week it will again reduce the maximum number of ships travelling the waterway to 31 per day, from 32 in August, due to a drought that has reduced the supply of fresh water needed to operate the locks.
That compares to daily averages of 36 to 38 ships per day under normal operation, or approximately a 20% reduction in capacity.
Nine ships per day will be allowed to use the new, bigger NeoPanamax locks and 22 per day will be handled through the older Panamax locks. The Canal Authority guaranteed a draft of 44 feet for ships.
Can The Port Of Savannah Unseat The King?
For years the Port of Miami has been the undisputed king of trade between the United States and South America.
Now though, the ocean carrier ZIM has launched a first-of-its-kind direct service between the Port of Savannah and the West Coast of South America (WCSA).
The direct service on the ZIM Colibri Xpress intends to take advantage of Savannah’s expanded refrigerated cargo infrastructure that can support agriculture inspections, cold treatment/retreatment services, fumigation and repacking.
Flavio Batista, Vice President of Sales and Marketing at Georgia Ports Authority (GPA), said: “We’re excited to be the first US port of call on this new ZIM service. Fresh produce from the West Coast of South America is a major growth target for Georgia Ports, with citrus, avocados, grapes and blueberries gaining traction through our gateway.” (more)
Judd Bare, GPA Regional Sales Manager, stated: “Our ecosystem of cold storage warehouse space continues to expand with the recent addition of a Lineage Fresh less than 6 miles from our gates. This brand new, state-of-the-art facility is dedicated to fresh produce.”
The ZIM Colibri Xpress rotation is: San Antonio (Chile) — Callao (Peru) — Guayaquil (Ecuador) — Kingston (Jamaica) — Savannah — Philadelphia — Miami — Kingston — Balboa (Panama) — Buenaventura (Colombia) —Guayaquil (Ecuador) — Callao (Peru)
Migrant Surge Interrupts Trade Flow From Mexico
The Defense Department is ramping up resources at the US-Mexico border as officials try to control a surge in border crossings in places including Eagle Pass, Texas, where the mayor has declared a state of emergency.
Some 800 new active-duty personnel are being sent to the border, where 2,500 National Guard members already serve.
As an additional measure, CBP’s Office of Field Operations temporarily suspended rail and vehicle processing operations in Eagle Pass in order to redirect personnel to assist with taking migrants into custody.
CPB officials eventually resumed operations at the international railway bridge in Eagle Pass, but only part of the bridge was reopened for vehicle processing. The trade is bracing for the impact additional diversions of resources could have on trade flows from Mexico via truck and rail.
More than 142,000 migrant encounters were reported in the first half of September alone.
It was widely reported that the number of migrants apprehended in a single day by the U.S. Border Patrol reached over 8,500 last month. Rural areas of southern Arizona, including the greater Tucson region and south Texas have seen large increases in migration.
That number is up dramatically from around 3,500 daily border arrests in May.
FTZ Staff Activity
- FTZ Board Staff processed a Minor Boundary Modification (S-164-2023) in FTZ 84 on behalf of McLane Global Logistic, LLC, Houston, TX on August 24, 2023
- FTZ Board Staff processed a Minor Boundary Modification (S-165-2023) in FTZ 74F on behalf of Sazerac Company, Inc., Halethorpe, FL on August 24, 2023
- FTZ Board Staff processed a Minor Boundary Modification (S-166-2023) in FTZ 94 on behalf of Crane Worldwide Logistics, LLC, Laredo, TX on August 28, 2023
- FTZ Board Staff processed a Minor Boundary Modification (S-167-2023) in FTZ 281 on behalf of Pegasus Logistics Group, Inc., LLC, Hialeah, FL on August 28, 2023
- FTZ Board Staff processed a Termination (S-168-2023) in FTZ 75I on behalf of American Italian Pasta Company, Tolleson, AZ on August 30, 2023
- FTZ Board Staff processed a Minor Boundary Modification (S-169-2023) in FTZ 94 on behalf of Bruni Supply Chain Solutions, Inc., LLC, Laredo, TX on August 31, 2023
- FTZ Board Staff processed a TSF Subzone Expansion (S-170-2023) in FTZ 49W on behalf of Getinge Group Logistics Americas, East Windsor, NJ on September 1, 2023
- FTZ Board Staff processed a Termination (S-171-2023) in FTZ 32 on behalf of BrightCell Logistics, LLC, Miami, FL on September 6, 2023
- FTZ Board Staff processed a Minor Boundary Modification (S-172-2023) in FTZ 64 on behalf of Primark US Corp, Jacksonville, FL on September 7, 2023
- FTZ Board Staff processed a Termination (S-173-2023) in FTZ 29 on behalf of Arvato Digital, Louisville, KY on September 8, 2023
- FTZ Board Staff processed a Minor Boundary Modification (S-174-2023) in FTZ 32 on behalf of Electricas BC Corp, Hialeah, FL on September 15, 2023
- FTZ Board Staff processed a Minor Boundary Modification (S-175-2023) in FTZ 32 on behalf of Leading Logistics, LLC, Doral, FL on September 15, 2023
- FTZ Board Staff processed a Minor Boundary Modification (S-176-2023) in FTZ 277 on behalf of Ball Metal Beverage Container Corp., Goodyear, AZ on September 15, 2023
- FTZ Board Staff processed a Traditional Minor Boundary Modification (S-177-2023) in FTZ 168D on behalf of Samsung Electronics America, Inc., Coppell, TX on September 18, 2023
- FTZ Board Staff processed a Minor Boundary Modification (S-178-2023) in FTZ 122Y on behalf of Aransas Terminal Company, Aransas, TX on September 18, 2023
- FTZ Board Staff processed a Minor Boundary Modification (S-179-2023) in FTZ 241 on behalf of Universal Marine Center, Inc., Fort Lauderdale, FL on September 19, 2023
- FTZ Board Staff processed a Traditional Minor Boundary Modification (S-180-2023) in FTZ 176 on behalf of the Greater Rockford Airport Authority, Rockford, IL on September 20, 2023
- FTZ Board Staff processed a Minor Boundary Modification (S-181-2023) in FTZ 45H on behalf of Lam Research Corporation, Sherwood, OR on September 19, 2023
- FTZ Board Staff processed a Termination (S-182-2023) in FTZ 75S on behalf of Rinchem Company, LLC, Surprise, AZ, Colonial Heights, VA on September 20, 2023
- FTZ Board Staff processed a Minor Boundary Modification (S-183-2023) in FTZ 35K on behalf of AstraZeneca Pharmaceuticals, LP, Bensalem/Philadelphia, PA on September 21, 2023
- FTZ Board Staff processed a Minor Boundary Modification (S-184-2023) in FTZ 50 on behalf of Valbruna Stainless, Inc., Chino, CA on September 21, 2023
- FTZ Board Staff processed a Termination (S-185-2023) in FTZ 138 on behalf of Specialized Bicycle Components, Inc., Groveport, OH on September 22, 2023
- FTZ Board Staff processed a Termination (S-186-2023) in FTZ 78 on behalf of Under Armour, Inc., Mt. Juliet, TN on September 25, 2023
- FTZ Board Staff processed a Minor Boundary Modification (S-187-2023) in FTZ 22 on behalf of Kuehne + Nagel Inc., Bensenville, IL on September 26, 2023
- FTZ Board Staff processed a Minor Boundary Modification (S-188-2023) in FTZ 138 on behalf of Specialized Bicycle, Columbus, OH on September 26, 2023
- FTZ Board Staff processed a Minor Boundary Modification (S-189-2023) in FTZ 32 on behalf of IGlobal Express LLC dba Dosan Cargo USA, Miami, FL on September 27, 2023
- FTZ Board Staff processed a Traditional Minor Boundary Modification (S-190-2023) in FTZ 21F on behalf of Volvo Car US Operations, Inc., Ridgeville, SC on September 27, 2023
Foreign-Trade Zone Board Activity
- PolyVisions Holdings, Inc. received authorization of production activity for plastic resin compounds within Foreign-Trade Zone 147 in Manchester, Pennsylvania. MORE
- Getinge Group Logistics Americas LLC submitted an application to expand Subzone 49W in East Windsor, New Jersey. MORE
- Findlay's Tall Timbers Distribution Center LLC dba Southern Tier Logistics received approval to operate their Village of Horseheads, New York facilities as Subzone 37G within Foreign-Trade Zone 37. MORE
- Dorel Juvenile Group Inc. received authorization of production activity for child strollers, walkers, and car seats within Foreign-Trade Zone 72W in Columbus, Indiana. MORE
- Epson Portland Inc. received authorization of production activity for inkjet ink cartridges and bottles within Foreign-Trade Zone 45F in Hillsboro, Oregon. MORE
- LEGO Manufacturing Richmond, Inc. received authorization of production activity for LEGO® Bricks and Toy Sets within Foreign-Trade Zone 207 in Chester and Colonial Heights, Virginia. MORE
- The Louisville & Jefferson County Riverport Authority received approval to expand the Alternative Site Framework service area of Foreign-Trade Zone 29 to include Christian, Todd, Logan, Simpson, Warren, Allen, and Barren Counties, Kentucky. MORE
- Toyota Motor Manufacturing Kentucky, Inc. submitted a notification of proposed production activity for dual fuel cell modules within Foreign-Trade Zone 29E in Georgetown, Kentucky. MORE
- Patheon Pharmaceuticals Inc. submitted a notification of proposed production activity for additional components and pharmaceutical products within Foreign-Trade Zone 46K in Cincinnati, Ohio. MORE
Back In Business:
Bet you didn’t think that was going to happen.
With only hours left before Uncle Sam’s spending authority expired, Speaker of the House Kevin McCarthy reached a deal with Democrats to keep the government in business for six more weeks. Still no federal budget, and more negotiation will be needed before the Thanksgiving holiday to avoid a repeat of the shutdown threat.
The impact of drought conditions on global trade is expanding. The Panama Canal situation continues to worsen, and major inland waterways in the U.S., Europe, and Asia are also experiencing flow restrictions which will drive up supply chain costs.
The U.S. stock market had a bad month in September. Inflation concerns persist despite rising interest rates, causing stocks to give back most of their summer gains. Downbeat economic news from China clouds the global economic outlook, and the war in Ukraine still seems nowhere close to a resolution.