Jun 15, 2016
Produce shippers face new transportation rules

FDA recently published the Sanitary Transportation of Human and Animal Food Rule. This final rule – which must be complied with by April 6, 2017 (April 6, 2018, for small businesses) – will affect many produce shippers, carriers and receivers.

The goal of the rule is to “prevent practices during transportation that create food safety risks, such as failure to properly refrigerate food, inadequate cleaning of vehicles between loads and failure to properly protect food,” according to Ed Treacy, vice president of supply chain efficiency for the Produce Marketing Association (PMA). Treacy and others discussed new food safety transportation rules during a recent PMA webinar.

Exempted from the rule is on-farm transportation; shippers, receivers or carriers with less than $500,000 in average annual revenue; trans-shipments of food through the United States (from Mexico to Canada, for example); food that is imported for export (not consumed within the United States); and food that is completely enclosed by a container and does not require temperature control for safety reasons (canned peaches, for example), according to Treacy.

Jon Samson, executive director of the American Trucking Associations, said the final rule differs in many ways from the original proposal. The final rule gives the ag industry more flexibility. Operators can put raw food and non-food items in the same trailer, for example, as long as the non-food items have no chance of impacting the raw items.

FDA originally adopted a “one size fits all” approach, but the final rule adopts more of a “if you see something, say something” approach. If someone sees a potential problem (a temperature device that quit working, an equipment issue, etc.), they should hold the food until someone qualified can make a safety determination, Samson said.

Imports, exports

The webinar also discussed upcoming changes affecting produce importers and exporters.

By the end of 2016, U.S. Customs and Border Protection’s (CBP) Automated Commercial Environment (ACE) will become the primary system through which to report imports and exports, and through which the federal government will determine admissibility. As CBP’s “single window,” ACE will streamline and automate manual processes, eliminate paper and allow the trade community to more efficiently comply with U.S. laws and regulations, according to CBP.

Even sooner, by July 1, international shippers must comply with new Safety of Life at Sea (SOLAS) container weight declarations. The new rules will require shippers to certify the weight of both cargo and container as a condition of loading aboard a vessel, according to PMA.

Peter Friedmann, executive director of the Agriculture Transportation Coalition (ATC), said the upcoming SOLAS rules – governed by the International Maritime Organization – have “rocked” the global transportation community and will “dramatically” affect the supply chain to and from the United States. Standard practice has exporters and importers providing the cargo weight only to the ocean carrier, which adds that to the weight of its own container and gives the total to the marine terminal. The new rules will require importers/exporters to provide the weight of both the cargo and the container – even though the container is provided by the carrier, Friedmann said.

Some shippers calculate that the cost to comply with the new rules could be in the millions of dollars, and the cost of shipping from the United States could increase from 11-25 percent, according to PMA.

ATC has fought the new SOLAS rules vigorously because they will “undermine the velocity of the supply chain,” particularly for refrigerated cargo. The ocean carriers have held firm on the new rules so far, but there are indications their position might be weakening, Friedmann said.

The situation is still uncertain, so Friedmann urged cargo interests not to rush into developing electronic systems to comply with a strict reading of the SOLAS rules as presently written, because those rules might change.

There’s another potential solution: Port authorities in the Eastern United States and Gulf Coast have indicated a willingness to weigh both cargo and container, which would let both carriers and shippers off the hook (and lead to more accurate measurements, too). West Coast ports might be moving in that direction, too, Friedmann said.

Speaking of West Coast ports, there have been concerns about their “velocity” – especially the Port of Oakland, which has been “dismally” slow lately. Attempts are being made to improve the situation, but one major ag company has already chosen to divert much of its cargo to East Coast ports. Other companies might follow, a move that could massively shift the entire domestic supply chain – changing truck and rail routes and the location of warehouses and processing facilities. It also would affect worldwide trade routes, moving more cargo through the Suez Canal and across the Atlantic instead of across the Pacific, Friedmann said.

Matt Milkovich


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