Some U.S. exporters have had to wait as long as a month to secure space on foreign-flagged ocean carriers compared to earlier wait times of about a week, according to Senate Agriculture Committee Chairman Blanche Lincoln (D-Ark.) and ranking member Saxby Chambliss (R-Ga.).
In a letter to Federal Maritime Commission Chairman Richard Lidinsky, the two senators point out that "These service interruptions, along with frequent rate hikes, are occurring despite the fact that most U.S. shippers enter into 12-month service contracts with the ocean carriers for fixed rates during the period. These contracts are supposed to ensure that the carriers will provide the necessary weekly equipment and vessel space consistent with each individual agreement. Unfortunately, it has come to our attention that carriers are now routinely failing to honor these contracts. Such breaches lead to increased costs for U.S. agricultural exporters and, in some cases, lost export opportunities."
Lincoln and Chambliss say they are optimistic that the situation will turn around once a global economic recovery is underway and there are improvements in fleet capacity. In the meantime, they say, "we are keenly interested in the steps the Federal Maritime Commission is now taking to address these issues.
They also ask Lidinsky to provide his views on whether the commission has the tools needed to ensure the that ocean carriers honor their service contracts with U.S. shippers, including the ability to penalize carriers for egregious practices. "If you lack such tools, we would welcome a discussion of ways to potentially strengthen the commission's authority with the carriers," they say.
Lidinsky earlier this year announced the commission was undertaking an investigation into space and equipment shortages. Results of that investigation have not yet been released.
