Dec 10, 2021

Ocean Shipping Reform Act applauded by Western Growers

The U.S. House of Representatives passed H.R. 4996, the Ocean Shipping Reform Act of 2021 on Dec. 8 with an impressive 364-60 vote, making clear its support for U.S. farm exporters that are reliant on maritime shipping transport.

The Ocean Shipping Reform Act of 2021 (OSRA) aims to crack down on unreasonable practices by container shipping lines, bolster U.S. enforcement against uncompetitive carrier practices, and improve transparency for exporters.

Western Growers President and CEO Dave Puglia issued the following statement:

“Western Growers is very pleased to see the House overwhelmingly pass H.R. 4996, which will help ensure fairer shipping practices and standards for our agricultural exports. The ongoing supply chain and marine port challenges are restricting our farmers’ ability to reach overseas opportunities. The Ocean Shipping Reform Act of 2021 provides much-needed improvements to the maritime shipping environment, which has increasingly become too unpredictable and costly for our exporters to remain competitive.

I thank Reps. Garamendi and Johnson for their bipartisan leadership on this issue. We look forward to similar swift action from the Senate, and we will continue to engage federal and state officials on additional relief measures to help alleviate this supply chain mess.”

Among other provisions, OSRA will:

• Ensure that carriers (e.g. container shipping lines) may not unreasonably decline to export cargo if it can be loaded safely, can arrive timely to be loaded, and is destined to a location to which the carrier is already scheduled.
• Require carriers to provide notice of cargo availability, container return locations, and adequate notice of dates when the export container must arrive at the terminal.
• Require carriers to provide the exporter with specific information to justify any imposed demurrage-detention charges, provide a reasonable dispute resolution process, and certify compliance with existing federal regulation.
• Prohibit retaliation by carriers against shippers that file complaints with the Federal Maritime Commission.

Foreign markets are critical to our members, especially those that produce tree nuts and citrus. Earlier this year, Western Growers supported an industry letter that urged the U.S. Department of Transportation to consider its existing powers and determine how it can assist with the transportation needs of U.S. ag exporters in overcoming the current challenges in shipping goods and products.

Since the fall of 2020, U.S. agricultural exporters have faced extreme challenges getting their products onto ships and out to foreign buyers, including record-breaking congestion and delays at ports, shipping lines’ persistent failure to provide accurate notice of arrival/departure and cargo loading times, excessive financial penalties and other fees, and skyrocketing freight rate costs.

Unfortunately, this situation remains fluid with no clear end in sight; based on current projections, we may not see a return to normal until mid-2022, all but guaranteeing tough months ahead for those commodities whose peak shipping seasons fall between September and March.