Fitch Outlines Risks to Ports from Container Weight Verification Rule; FMC, Coast Guard Schedule Meeting

There's growing uncertainty over the ports' ability to handle coming container weight verification rules, said Fitch Ratings in a news release (here). The regulations could slow trade processing, the ratings company said. "Fitch-rated ports have neither designated facilities for weighing containers nor the systems for the verification of container weights," Fitch said. "This could raise already chronic congestion at the ports that are slowed by chassis management issues, higher cargo loads from larger vessels and inadequate inland or intermodal links." The new rules, set to take effect July 1, are the result of an International Maritime Organization amendment to the Safety of Life at Sea (SOLAS) agreement.

Although "the shipper on the bill of lading will bear responsibility for verifying the weight, the apportionment of logistics and costs of verification among shippers, forwarders, terminals and carriers remains to be seen," the company said. "The exact nature of documentation is also unknown, though forwarders and terminals favor the use of electronic data interchange systems that already communicate bookings and shipping instructions for about half of the 300,000 containers moved in the US daily." Meanwhile, The Federal Maritime Commission and the U.S. Coast Guard scheduled a Feb. 18 public meeting to discuss a coming container weight verification rule. The Coast Guard, which is expected to handle enforcement of the requirement, "will be in attendance to hear concerns and feedback from industry and stakeholders on this issue," it said (here).

Despite the initial concerns, the risks are likely to subside, the ratings agency said. "For smaller ports choosing to offer weighing services to delinquent containers, capital outlays to provide calibrated weighing equipment should be manageable," it said. "Forwarders and larger carriers will likely force the market to move toward an electronic industry standard that may ultimately lead to more efficient data management in terminals. We expect overall port throughput to rise in 2016, driven by industry consolidation favoring larger ships and implementation of operational alliances by shipping lines and ports."

Separately, the World Shipping Council defended the International Maritime Organization process that led to controversial container weight verification rules in response to an Agriculture Transportation Coalition (AgTC) position paper that criticized the IMO (see 1602100034) on the subject. The WSC pushed back on claims that U.S. industry was largely unaware of the requirements and would be uniquely affected. "There is no denying that obtaining an accurate weight of the packed container is associated with a cost because doing so requires that weighing actually be done," said the WSC. "However, the requirement to provide an accurate weight for the packed container is not new – it is an existing requirement under SOLAS." That cost "already should have been built into the supply chain," said the WSC.

Email ITTNews@warren-news.com for a copy of the WSC's response to the AgTC