With complaints growing over backlogs and congestion in the Port of New York and New Jersey and unfair detention and demurrage charges, Federal Maritime Commissioner Daniel Maffei and Lucille Marvin, who was recently named Acting Director of the Bureau of Enforcement, Investigations, and Compliance at the FMC, visited Port Newark to meet with stakeholders. After seeing conditions first-hand in the port, Maffei called on carriers that have fallen behind to move their empties while turning the tables on carriers and saying they should be compensating truckers for storing the carriers' equipment.
The FMC has been outspoken on the issue of D&D charges and the need to move empties from the ports previously setting forth an incentive principle to clear the backlogs. “When ocean carriers continue to bring thousands of containers per month to a port and only pick up a fraction of that number, it creates an untenable situation for terminals, importers and exporters, trucking companies, and the port itself.”
Citing the growing problems in the Port of New York and New Jersey, two trucking associations, the National Industrial Transportation League and Bi-State Motor Carriers Association, last week appealed to the FMC urging the suspension of demurrage and detention at the port. They raised concerns about equipment availability and D/D charges being imposed on members while port congestion makes it impossible for shippers or truckers to return equipment.
“I will do everything in my power to ensure that carriers do not receive involuntarily subsidized storage for empty containers that belong to them,” said Maffei. “If it can be shown that a shipper or a trucker is not allowed to return a container then – not only should they not be charged per diem but – the carrier should compensate that trucker for the space it takes up.”
Maffei highlighted that the FMC is already been investigating reports of carriers charging per diem container charges even when the shipper or trucker cannot possibly return the container due to terminal congestion. “I will ask that this investigation be broadened and intensified to cover instances where shippers and truckers are being forced to store containers or move them without proper compensation.”
The reforms to the Ocean Shipping Act that became law in June shift the burden on D/D fees toward the carrier establishing new procedures for the fees. The FMC has already reminded carriers that there was no grace period and that they needed to immediately alter the procedures. Even before the changes in the law, the FMC was using its rules to make carriers responsible and promote the movement of cargo to free up chassis and space in the ports.
Earlier this week, the Port of New York and New Jersey announced a new program where it plans to begin charging a quarterly imbalance fee to carriers that fail to remove an amount equal to 110 percent of the containers they offload into the port. This comes as the port works to manage continuing growth in volumes. The port said it is handling a cargo increase of nearly 12 percent year-to-date.
Today, there were 14 containerships at the Port Newark Marine Terminal complex. In addition, another dozen containerships were waiting south of Long Island to enter the Port of New York and New Jersey with another five ships further south near the New Jersey coast. Port officials said volumes are up 34 percent since pre-pandemic in 2019 and despite increasing storage space more needs to be done to move empty containers from the port.
