volume 8 issue 7 - usa, inc€¦ · volume 8 issue 7 . volume 8 issue 7 n starting december 3,...

Inside this Issue:

1.TSA to Require 100% Cargo Screening

2. China, Japan & South Korea FTA

3. Southwest Airline’s Expansion

4. Chicago Airport to Open New Hub

5. Spotlight on KWE!

6. Canada & Japan Strengthen Relation

7. Canada & U.S. Restructure Security

8. KWE Posts Profits for FY 2011

9. IATA’s Time & Temperature Label

10. New IATA Labels

11.KWE Spotlight

12.KWE Spotlight

13. Top 10 Cities for Global Trade

14. ILA vs. USMA

15. Russia Joins WTO

16.US Furniture Industry Resurgence//

KWE Holiday Schedule

17. Updated BAF/IFC //Canadian GRI Updates

Volume 8 Issue 7

Volume 8 Issue 7

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Starting December 3, 2012, The Department of Homeland Security’s Transportation Security Administration (TSA) will require passenger air carriers to conduct 100 percent cargo screening on international inbound flights. This effort was mandated as part of the congressional Implementing Recommendations of the 9/11 Commission Act signed by former President George W. Bush in August 2007. According to TSA, this new measure requires all air cargo to be screened prior to transport on a passenger aircraft flights incoming to the United States. TSA officials announced, “The screening requirement builds additional risk-based, intelligence-driven procedures into the prescreening process to determine screening protocols on a per-shipment basis.” Included in this initiative includes TSA’s Certified Cargo Screening Program, which enables indirect Air Carriers (IAC), shippers, and Independent Cargo Screening Facilities (ICSF) to screen cargo for flights originating in the United States. “This process requires enhanced screening for shipments designated as high risk, while lower risk shipments will undergo other physical screening protocol,” TSA states. A portion of this method has already been implemented for the passenger aircraft side for domestic aircrafts since August 2010.

The U.S. Customs and Border Protection (CBP) and the TSA will also jointly collaborate to enhance air cargo supply chain security. Targeted for Air Cargo Advanced Screening (ACAS) will be air cargo shipments inbound to the U.S). ACAS will allow CBP and TSA to obtain prior security filing cargo information on inbound consignments as a means to identify consignments which are perceived to be high risk; and which, therefore, require additional appropriate regulatory screening. Though specific details regarding information filing have not been established, a number of countries with airports that offer direct flights to the U.S., and which have pre-existing air cargo security programs, have already signed mutual agreements with CBP/TSA.

The leaders of the three countries- Chinese Premier Wen Jiabao, Japanese Prime Minister Yoshihiki Noda and South Korean President Lee Myung-bak- have formally agreed to launch trilateral free trade agreement (FTA) negotiations by the end of this year. China, Japan and South Korea, which are Asia’s largest, second-largest and fourth-largest economies respectively, account for about 20 percent of the world’s economy and 18.5 percent of global exports. Trade between all three nations is valued at over US$690 billion (atimes).

photo credit: EastAsia Forum According to an official report by the Xinhua News Agency, the collaboration could raise China’s GDP by 2.9 percent, South Korea’s by 3.1 percent and Japan’s by 0.5 percent. The agreement the possible trilateral pact was reached following seven years of research and two years of governmental studies between all three countries (China Post).

Kintetsu World Express (KWE) will, as always, comply with TSA cargo security mandates, as it maintains strict compliance disciplines with all regulatory agencies and their respective requirements. Maintaining a high level of service and support for our clients is paramount. KWE will be an active participant throughout the ACAS process from its initial stages through implementation to ensure proper security protocols for our valuable customers.

photo credit: Horn Packaging

“Chicago Mayor Rahm Emanuel said the city plans to open a $200 million hub next year, as the city attempts to boost international volume through O’Hare Airport (Journal of Commerce).” The opening of the Chicago O’Hare International Northeast Cargo Center is expected to create approximately “1,200 construction jobs, 1,200 permanent on-site jobs and 10,000 regional jobs related to the development,” said the mayor’s office. According to the Chicago Tribune, Aeroterm, the developer for the project will spend roughly $130 million and the airport kicking in more than $62 million.

Chicago is a key gateway for air cargo exports to China. The city took Los Angeles International Airport’s spot as the top gateway in 2010.

photo credit: createandflyfree23.tumblr.com

The Houston City Council, in a unanimous 16-0 vote, has approved Southwest Airlines’ request to expand Houston Hobby International Airport. This $100 million plan will lead Southwest routes into Latin America. The federal government needs to now approve necessary Customs clearance facilities and once approved, construction will begin Spring 2013 and is estimated to finish in 2015. Southwest plans on covering all associated costs for this project. Once the expansion is complete, Southwest will allow the City of Houston to claim ownership in return for some benefits. A few perks Southwest requested include “to receive preferential scheduling rights and will be able to use,

rent-free, four gates of the new international wing as well as free use of the new Customs facility (Air Cargo World).” Advantages for the city of Houston will include not accumulating additional debt while expanding its airport. According to a press release, Southwests’ expansion will produce approximately 20 additional daily departures from Houston Hobby International Airport.

photo credit: transglobalexpress

photo credit: thestar

Parliamentary Secretary to Canada’s Minister of Agriculture, Pierre Lemieux, visited Japan to support trade relations between Canada and Japan; as well as promote mutual benefits of an Economic Partnership Agreement (EPA). “Canada’s agriculture producers and processors depend on the Japanese market. That’s why our government continues to make international trade a priority,” said Parliamentary Secretary Lemieux. “Consumers in both Tokyo and Toronto will have more choices for high-quality food as our two countries strengthen our trade relationships (MSNBC).” Japan ranks as the world’s third largest economy and Canada is the second-largest agricultural market in the world. To Canadian farmers and food processors, Japan’s market is worth an estimated $4 billion. Canada’s Prime Minster Stephen Harper and Japan’s Prime Minister Yoshihiko Noda met in March of this year to discuss future EPAs.

The United States and Canada recognize each other’s screening protocols but once an agreement is passed, cargo entering the U.S. or Canada won’t have to be re-screened once it’s uploaded on a passenger aircraft in the other country (Air Cargo World). A press release by Canadian authorities stated their belief that this initiative will reduce delays and lower costs associated with the security screening. Nearly half of all airfreight flown in Canada is transported on a passenger craft.

Canada’s Minister of Transport, Infrastructure and Communities, Denis Lebel, and Deputy Chief of Mission at the U.S. Embassy James Nealon, both believe this new program will strongly impact North American trade. Mutual recognition of each other’s air cargo security will cut costs for both American and Canadian businesses and consumers as well as improving efficiency. This proposed agreement piggy backs off of the agreement between the U.S. and EU in early May where there was a mutual agreement to recognize each other’s known shippers. Once the agreement goes into effect July 1, companies will experience faster Customs clearance without compromising security standards.

photo credit: Cohen.Canada’s Flickr

Kintetsu World Express, Inc. (KWE) posted profits for its 2011 fiscal year. KWE’s net group profit rose 21.1 percent from the previous year, equating to an $119.31 million increase profit, the largest amount ever recorded. KWE is one of Japan’s largest international freight forwarders and a global leader in the industry. The predicted economic outlook for KWE was uncertain for various reasons, including the Japanese earthquake, heavy floods in Thailand, debt crisis in Europe and the recession. KWE states, “Although mainstay air cargo operations were sluggish, it vigorously pushed ahead with cost-cutting efforts, such as abolishing or merging some business offices, resulting in the record net profit.”

Air cargo transportation volume decreased after the Great East Japan Earthquake as a result of a decline in global demand for tech products being exported from Japan. KWE, however, forecasts a profit for the fiscal 2012 year in group operating revenue and profit. KWE consists of 59 consolidated subsidiaries and six affiliates. The group’s main businesses are international and domestic freight contracting including airfreight forwarding, import freight consolidation and international sea freight forwarding using transport provided by airlines and shipping companies. KWE also offers customs clearance, trucking and packing services.

Beginning July 1, the International Air Transport Association (IATA) will necessitate a mandatory Time and Temperature Sensitive label for transportation of healthcare cargo shipments requiring temperature control service (under the Cargo Services Conference Resolution Manual Resolution 607, Section 1). The Time and Temperature Sensitive label must be purchased through IATA and attached to all shipments in Celsius format. The temperature indicated on the label must match the approved temperature transportation range. It is the responsibility of the shipper, or the shipper’s agent, to provide appropriate labeling for booked time and temperature sensitive healthcare shipments.

According to IATA, the benefits of the new labeling procedures include: better identification of temperature sensitive healthcare cargo shipments and external temperature range required during transportation, faster supply chain transit handling, greater reliability and accuracy to improve operational processes and decreases the risk of mishandling of the product.

. KWE receives the Quest For Quality Award 2012. With an overall score of 47.61, KWE ranks number two out of nine forwarders for this most prestigious award. In terms of service reliability, on-time performance, value, and customer service, KWE scores impressive numbers across all rated categories. While Europe’s various economic challenges are not having a direct impact on the U.S. just yet, Josh Green (Panjiva CEO) cautions that if the uncertainly continues it will most likely begin to impact trade flows across multiple geographies—adding yet another layer of complexity to global logistics management. Global shippers are increasingly becoming reliant upon freight forwarder market leaders to meet their expanding global distribution needs. The nine freight forwarders below have proven this theory and the results of the Logistics Magazine readers are confirmed below.

Logistics Management Magazine has once again named KWE to it’s 2012

“Quest for Quality Award” list

LM’s Quest for Quality is regarded in the transportation and logistics

industry as the most important measure of customer satisfaction and

performance excellence.

KWE proudly placed second in Overall Score.

KWE is pleased to announce that KWE Benelux acquired the EU*AEO standards certification. KWE Benelux is the fifth company within the KWE Europe group to receive this certification. KWE Germany, France, Ireland and UK have already attained the accreditation. The AEO-F ensures that KWE Benelux receives preferential treatment in customs clearance procedures as well as security and safety controls. This will speed up customs clearance procedures for the company’s sales offices in Amsterdam, Rotterdam and Brussels.

photo credit: KWE Benelux

For the third consecutive year, KWE France was presented with the Lufthansa Cargo

Award for 2011.

KWE is pleased to present a restructured KWE USA website! The updated

modernized website is user-friendly, easy to navigate and contains all relevant and

pertinent industry news.

Please visit the new site at:

www.kweusa.com

photo credit: Inbound Logistics

Inbound Logistics is a monthly newsletter distributed for business logistics managers. The magazine publishes an annual list of Top 10 third-party logistics for their July issue by asking their readers cast a

vote for a logistics company that has demonstrated excellence in service.

KWE is asking our readers and valuable customers to cast their vote for us by filling in a short

questionnaire by clicking here or the image below! Thank you!

http://www.kweusa.com/

http://www.inboundlogistics.com/cms/top-10-vote/

http://www.inboundlogistics.com/cms/top-10-vote/

Global trade impacts all, whether in a large city or small, and exporting is a very exciting endeavor that adds value in helping the nation earn much needed foreign exchange. In a recent article featured in Global Trade magazine, the top 50 Cities for Global Trade in the United States were highlighted . Rankings were based upon total export volume as compiled by the International Trade Administration ( ITA). Rather than list all 50 cities, the list was broken down further to reflect the top ten global export cities within the US. Thee order is from Greatest to volume to Least, the Top 10 U.S. Cities for Global Trade are listed below.

1. New York , New York~$85.1billionUSD Major Trade lanes include Japan, China, & Canada . NYC reportedly exports annually 12 million tons of sea cargo, $16.1 billion in miscellaneous manufactured commodities, chemicals at $14.4 billion, and $ 6.6 billion in computers/electronic commodities. In addition, NYC exports $4billion in precious gems.

2. Houston, Texas $80.6billionUSD Major Trade lanes include China, Canada & Mexico. Houston exports majority Chemicals, Petroleum & Coal Products as well as Machinery.

3. Los Angeles, California $62.2 billion USD Major Trade lanes include Mexico, Canada, & China. Los Angeles finds its niche in exporting Computer & Electronic Products, Transportation Equipment, and Misc. Manufactured Commodities.

4. Detroit, Michigan $44billion USD Major Trade lanes include Saudi Arabia, Mexico, and Canada. Detroit’s key commodities exported included Transportation Equipment, Machinery, computer & Electronic Products. Detroit sends 71% of its exports to NAFTA ( North America Free Trade Agreement) countries, with transportation equipment topping the city’s list of key commodities at a whopping $28.8 billion. This calculates to 66% of its $44 billion total export volume.

5. Miami, Florida $35.9billion USD Major Trade lanes include Venezuela, Brazil, & Columbia. Top exporting commodities include computer & electronic products, transportation equipment & machinery. Be that Miami is home of the largest concentration of international banks in the United States, the city is considered an Alpha, or Global City as well as a critical cog in the world economy. Much of the trade done in Miami is with South America, thus enabling them to earn the nickname “ Capital of Latin America”.

photo credit: GlobalTrade

6. Seattle, Washington $35.4 billion USD in

export volume. Major Trade lanes include Japan, China, & Canada. Key exporting commodities include, Computer & Electronic products, Fishing, Hunting, & Trapping equipment as well as Manufactured goods. Seattle is one day closer to Asia than other U.S. ports and sending air cargo via the polar route has fueled this cities $35.4 billion export boom. $5.2 billion in exports to China, $3.6 billion to Japan, and $1.6 billion to Korea, Seattle is America’s top city for intellectual capital as well as computers & electronics.

7. Chicago, Illinois $33.7billion USD, Major Trade lanes include Germany, Mexico, & Canada. Key

commodities of export are chemicals, computers, & electronic components. Rated as having the most balanced economy in the U.S., and being the city owning the second-largest labor pool in the country, Chicago export volume has placed it legitimately within the top 10 of the total 50 top export cities in the United States.

8. San Jose, California $26.3 billion USD Major Trade lanes include South Korea, Mexico, & Canada. Key commodities exported are Chemicals, Machinery, Computers & Electronic products. Computer exports ranks at the top of the list for San Jose with $18.6billion in revenue from these commodities alone. In addition, due to existing trade agreements, San Jose exports $5.3billion to NAFTA and $183million CAFTA-DR.

9. Minneapolis, Minnesota $23.2 billion USD Major Trade lanes include China, Mexico, and Canada. Top

exported commodities are agriculture crops, computer & electronic products, and machinery. With 27% of its exports being crops and 13% a combination of computer & electronic products, Minneapolis is a city of diversity.

10. Philadelphia, Pennsylvania $22.7billion USD. Major trade lanes are the United Kingdom, Canada, and New Mexico. Key export commodities are Chemicals, Transportation Equipment, and Computer/Electronics. Philadelphia remains in the top 10 U.S. metro areas by export volume.

photo credit: GlobalTrade

The ILA and the USMA have both agreed to extend the collective bargaining agreement scheduled to expire at the end of September, 2012 for 90 days that will carry through until December 29th 2012. Both parties have agreed that the decision was for the greater good of the country to avoid any disruption in interstate commerce. The meetings are Mediated by the FMCS (Federal Mediation & Conciliation Service)a federal agency that manages the arbitration and mediation of labor disputes. The FMCS is an independent agency charged with minimizing the impact of private-sector labor disputes on commerce through mediation or voluntary arbitration. The agency helped end a 10-day West Coast ports closing in 2002 that cost the national economy an estimated $1 billion a day. Earlier this year talks abruptly ended Aug. 22 due to the ILA’s refusal to discuss management proposals for changes to work rules and overtime pay practices that drive up cargo-handling costs, especially in the Port of New York and New Jersey. Employers wanted to address provisions, many dating back decades, that require high levels of staffing and overtime pay. ILA President Harold Daggett said the proposed changes would undo years of union gains. The ILA has not had a coast wide work stoppage since 1977. In lieu of the earlier confirmations of a sure strike, many shippers have responded to the impending threat of an East and Gulf Coast work stoppage by moving cargo early to pad inventories, or by securing space on West Coast services, where capacity was already limited as the the holiday peak season steadfastly approaches. In an effort to prepare for a possible strike several container ship lines have announced congestion surcharges that would take effect at U.S. ports in the event of a work stoppage. Surcharges in access of $1,000 or more per 40-foot box, are needed to offset costs of ship charters, adjustments to inland transportation, and delays at ports according to the various carriers.

photo credit: NJ News.com

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In July, after an eighteen year effort, the Russian Parliament finally approved the country’s entry into the World Trade Organization (WTO). Russia will formally join the 150+ member trade organization. Upon gaining entrance, customs duties on imported manufactured goods such as clothing and consumer electronics will be reduced, thus opening the Russian market to foreign competition. With an economy of about $1.9 trillion, Russia was the largest country not part of the WTO. However, the economic size of the country is perhaps a bit misleading as two-thirds of its exports is oil and about half of the federal revenue is derived from oil. The World Bank has estimated increase exposure to foreign competition will improve Russian business effectiveness and could result in GDP growth of as much as 11%. Although this anticipated growth in GDP would be welcomed, it may be difficult to achieve because Russia is among the least-densely populated countries in the world. In addition, the United States remains as the one exception / holdout to recognition of Russia as a WTO trading partner. The Jackson-Vanik rule enacted in 1974 will prevent normal trade relations between the US and Russia, a status which is required under WTO rules. Even with the above limitations and qualifications, the World Bank is still predicting significant improvement in Russia’s competitive position and will open doors for Russia to receive foreign investors that will help Russia to overcome the challenges presented by its enormous geography.

photo credit: cfr.org

photo credit: en.rian.ru

Now is the season for companies to return to manufacturing, according to Bruce Cochrane a furniture Manufacturer in North Carolina. Today, nearly every North Carolina manufacturer sources components or labor overseas. The emergence of the Chinese middle- class is an economic event that, like the preceding wave of aggressive exporters, has the potential of changing the economic paradigm by sheer dint of its size and appetite. Already, it has helped refuel the U.S. economy, emitting a rare ray of sunshine in what has been a dark, damp and dreary post-recession recovery. As American consumers learn to do more with less, Chinese shoppers have been lining up, shopping bags at the ready. This year, North Carolina’s manufacturers will export about $52 million in furniture to China. While the number is relatively small, it’s growing fast, says Mike Padjen (North Carolina’s point man for promoting furniture exports, and a veteran of many trade missions to China,) up nearly 500 percent over the last three years. That number is probably doubled by furniture manufactured in China or other parts of Asia working for U.S. brands. The fact that many American products are actually made in China, or other Asian countries, does not tarnish the mystique. Says Padjen: “Even American branded or designed furniture, which is made in Asia, has seen a big uptick in sales around the world and especially in China for what I perceive as similar reasons.” China is young, fractionalized and a growth market. Furniture companies in the likes of La-Z-Boy, Ethan Allen, & Bernhardt Furniture are a few brands that have entered into the China market and have seen great results. The resounding premise across all of these organizations is that China is a strong part of the future.

photo credit:mbponline

October Holiday Schedule

1-7 National Day China

3 Unity Day Germany

8 Canadian Thanksgiving Canada

8 Columbus Day United States

12 National Day Spain

26 National Day Austria

WESTBOUND (from USA to Asian destinations)

October 1, 2012 through December 31, 2012

20’ dry 40’-45’ dry 20’ reefer other reefer

BAF – West Coast 563 703 788 984

BAF – East Coast 1120 1400 1480 1850

IFC – Pure truck 101 101 101 101

IFC – Truck/Rail 348 348 348 348

EASTBOUND (from Asian origins to USA)


per 20’ per 40’ per 40HQ per 45’

BAF – West Coast 422 527 593 667

BAF – East Coast 816 1020 1148 1291

IFC-Truck 101 101 101 101

IFC-RIPI 174 174 174 174

IFC-IPI 348 348 348 348

TRANSPACIFIC OCEAN (from Asian origins to Canada)


per 20’ per 40’ per 40HC per 45’

Via West Coast 422 527 593 677

Via East Coast 816 1020 1148 1291

volume 8 issue 7 - usa, inc€¦ · volume 8 issue 7 . volume 8 issue 7 n starting december 3,...

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