Common Import Sea Freight Problems
WHY SO MANY DELAYS?
Common Import Sea Freight Problems
Importers can tell you that things can go wrong very quickly with ocean shipments. The majority of which are beyond their control.
Things go wrong at the factory, at loading docks, at sea ports both in China and elsewhere. The list of ‘why did this happen’ can be both long and varied. These problems can be suck the life out of margins, result in cancelled ordered, be punitive, financially draining, and be complicated to straighten out. The fix can be as simple as submitting an errant document or as complex as lab testing requirements.
There are so many import controls and regulations to keep up with. You can do everything right and still encounter issues. Failing to comply with regulations causes penalties, delays, unexpected costs and possible confiscation.
12 COMMON ISSUES WHEN SHIPPING SEA FREIGHT:
- Custom Exams: Manifest Hold, Commercial Enforcement Hold, Statistical Validation Hold, CET Hold (A-TCET), PGA Hold
- Per Diem
- Missing/lost Documents
- Custom Clearance Problems
- Overweight / Unevenly distributed cargo
- Lost Containers at the terminal
1) Custom Exams in China and in N. America:
When containers leave China and/or enter the US or Canada, they face layers of potential examination. Custom demands can be made for types of importers or commodities. There are complex algorithms that read your paperwork to determine if something requires a second look.
If you ship LTL (less than a container load) and someone else is of customs-interest, and their goods are bundled in the same share container as yours, you’ll have to wait until their shipment is cleared. Through no fault of your own, your shipment can languish for weeks until all your co-load partners have passed inspection.
There are so many exam types. Once it begins, the process can cascade to include additional testing. Exams are costly, time or money or both, and charged to importers directly and indirectly. Some have associated fees, and then there’s demurrage, per diems and delivery delays. Here are a few of the most common reasons for delay.
Based on data or the lack thereof on the carrier’s manifest, as well as ISF data.
Commercial Enforcement Hold
Any hold for Customs issues. Many agencies regulate imports: FDA, USDA, CPSC, FCC and others.
Statistical Validation Hold
Triggered by declared document discrepancies.
CET Hold (A-TCET)
Anti-Terrorism Contraband Enforcement Team. Drugs and guns.
A number of other Participating Government Agencies (PGAs), e.g., FDA, USDA, CPSC and a host of others regulate products entering the U.S. Any of these agencies may instruct CBP to place a hold on a shipment to ensure that it complies with regulations.
Damage can occur to cargo or container. Improperly securing cargo gets damaged during the transport or by terminal operators. In both cases, claims must be made and in all cases, this delays arrival.
Steamship lines charge Demurrage for containers held longer than the agreed free time. Demurrage is charged for each additional day. Demurrage can be triggered for a variety of reasons from late freight or custom release, long exams, damaged to overweight containers.
4) Per Diem:
Steamship lines charge for equipment use. The charge is from when the container leaves the terminal and when it is returned. Carriers want their empty containers back! You are allotted a specific number of days, late return cause additional charges.
Truckers assess detention charges, billed by the hour, when too much time is taken de-stuffing the container. Normally, 2 hours is free but after that, trucks and drivers charge these fees because they cannot go pick up new cargo.
6) Missing Documents:
The original B/L’s (Bill of Lading) are one of the most important document. When the B/L is lost, the release process is delayed, and it will trigger demurrage and release delays.
7) Custom Clearance Problems:
Importers providing incomplete and inaccurate information are likely to face examination. Custom agents are very suspicious and if they smell something, it’s going to cost. How much? Your costs could go up by thousands of dollars.
8) Overweight / unevenly distributed cargo:
If container weight is higher than stated on the documents or is unevenly distributed, the trucker pick-up and delivery is affected. Container needs to be de-stuffed and repacked. This is costly both cost and time wise.
Strikes can happen anywhere your shipment may touch. From rail, origin/destination/ transshipment port, work stoppages cause stagnation and congestion. The end result being late arrival.
There are many import regulations. Failing to comply causes fines and penalties. If an importer does not file the ISF, US Customs can assess a $5000 fine. This also has a cascading effect. Miss the filing, expect customs examinations at the port of destination. There are also customs penalties assed for incorrect information.
A very common delay caused by different holidays around the world. Delays can happen in China or at the destination port. Post-holiday, ports, truckers, and customs are all trying to catch up. Holidays cause congestion and affects container release and delivery. Worse, importer can be assessed demurrage, and per diems.
12) Lost Containers at the terminal:
After containers arrive and are discharged from the vessel, containers get lost. A port staff search can take several days. Although ports will waive demurrage fees, importer end up with delivery delays.
This article is as a general overview to highlight common sea freight delay issues. The goal is to assist new importers in understanding how extra charges that might occur when containers depart and arrive at the port of discharge.