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Featured Headlines:

AD/CVD Served Up on a Paper Plate Platter

CBP Starts Loving a New Version of 5106 As of February 1

FinCEN Issues Red Alert!

Rearranging Rail Routes

Rail Round Up

Forced Labor Legislation

Biden Bets Big on ‘Greener’ Pastures

Yet Another Suez Update

Airfreight’s Fair Fate

AD/CVD Served Up on a Paper Plate Platter

CBP Starts Loving a New Version of 5106 As of February 1

  • U.S. Customs and Border Protection (CBP) has advised that the Revenue Division will only accept the current version of CBP Form 5106 through February 1, 2024.
  • According to CBP officials, all other versions will be rejected as of this month. To help reduce the rejection rate, please read the 5106 instructions before completing the form.
  • The below chart lists the fields on the 5106 that are required, conditional, and optional.

  • Please note that corrected submissions are considered new submissions and processing times will start over.
  • Need to talk about your 5106 Forms? Contact our Compliance Experts today!

FinCEN Issues Red Alert!

  • The United States has consistently opposed actions that undermine peace, security, or stability in the West Bank—which include, but are not limited to the following:
    • Attacks by Israeli violent extremist settlers against Palestinians.
    • Attacks by Palestinian violent extremists against Israelis.
    • Acts that unduly restrict civilians’ access to essential services and basic necessities and risk further escalating tensions and expanding the conflict in the region.
  • According to U.S. government agencies, the trade community should be on the lookout for these red flags:
    • Payments to any organizations or groups, including nonprofit organizations (NPO), that are now or have been previously linked to violent extremist groups in the West Bank or lists an officer, founder, or director that is currently or has been previously linked to Israeli violent extremist groups in the West Bank.
    • Information included in a transaction between customers, such as references in the memo field, that indicate support for Israeli violent extremist groups or campaigns.
    • Transactions with no apparent economic, business, or lawful purpose associated with a rapid movement of funds and linked to NPOs active in supporting violent extremist Israeli settlers in the West Bank, particularly if the NPO has advocated for, or solicited donations on social media in support of, Israeli violent extremist groups or campaigns.
    • Purchases of tactical military gear for resale overseas and destined for non-government Israeli end-users in the West Bank, particularly if the end-users are currently or have been previously linked to Israeli violent extremist groups in the West Bank.
  • The Financial Crimes Enforcement Network (FinCEN), a bureau of the United States Department of the Treasury, continues to emphasize that legitimate charities should have access to financial services and can transmit funds through legitimate and transparent channels.
  • It also requests that financial institutions reference this alert by including the key term “FIN-2024-WBEXTREMISM” in SAR field 2 (Filing Institutions Note to FinCEN) and the narrative to indicate a connection between the suspicious activity being reported and this alert.
  • For more information regarding this announcement, visit the Executive Order on Imposing Certain Sanctions on Persons Undermining Peace, Security, and Stability in the West Bank.

Rearranging Rail Routes

  • Norfolk Southern Railway (NS) is playing musical chairs with its routes…and it looks like Birmingham and New Orleans just lost their seats! Come February 19th, these cities will pull the plug on both domestic and international intermodal services in wake of the low volumes moving through those areas.
  • Meanwhile, NS is cutting a rug with reroutes, making moves between Allentown, Pennsylvania, and a trio of cities—Memphis, Kansas City, and St. Louis—as well as between Elizabeth, New Jersey and Toledo, Ohio. It’s all part of a grand plan to dance with the ones that “brung ’em” …or in this case, where the most volume is swinging.
  • Luckily, NS’s VP, Shawn Tureman, is donning his dancing shoes and busting the moves to shrug off sluggish growth, spotlighting Atlanta, Charlotte, and Florida as the next big areas for expansion.
  • With Birmingham and New Orleans stepping off NS’s dance card, at least the Georgia Ports Authority (GPA) isn’t missing a beat, choosing CSX to tango with its intermodal customers destined to The Magic City or The Big Easy moving forward. Yes, curious readers, Birmingham is indeed called The Magic City!

Rail Round Up

  • At the corral of the Midwest Association of Rail Shippers Winter Meeting, railroad executives lassoed the notion that herding more freight off highways and onto railcars might just boil down to forming tighter bonds with the trucking industry and the nation’s short line rail wranglers.
  • Rail leaders from Union Pacific (UP), Norfolk Southern (NS), and CSX see a ripe chance to rustle up new business—especially with trucking outfits hunting for ways to cut costs and corral their emissions.
  • Some UP executives have tipped their hats to initiatives such as on-dock service at Port Houston and the cross-border Falcon Premium service to help bolster rail service.
  • Spurred by last year’s derailment near East Palestine, Ohio, NS’s head honcho vowed to make the railroad’s world even safer, boasting a 40% dip in main line accidents on top of delivering the best intermodal service in over six years.
  • With its eye on the chemical cargo prize, CSX shared its vision of shifting loads from the congested trails of the highway to the open ranges of rail. With the acquisition of Quality Carriers, CSX aims to herd chemicals onto the rail, providing a safer and more cost-effective ride through the intermodal plains.
  • Across the board, these rail ranchers are spurring their steeds towards growth in intermodal services, betting on efficiency, safety, and reliability to win over shippers.

Forced Labor Legislation

  • Stricter due diligence laws that target the import of products made using forced labor are set to introduce significant disruptions to global supply chains, as highlighted by Verisk Maplecroft, a global risk intelligence specialist.
  • With progress in labor rights stalling globally, new legislation—such as the German Supply Chain Due Diligence Act and the EU Corporate Sustainability Due Diligence Directive— will require companies to more rigorously address any labor abuses found within their operations or supply chains.
  • The enforcement approach by US Customs and Border Protection (CBP), which assumes that all products from the Uyghur region are made with forced labor, has been praised by some industry folk who advocate for similar enforcement strategies in the UK and EU.
  • As companies face incoming regulations that require greater transparency and due diligence in their supply chains, there is a risk that firms may establish “clean” supply chains to comply with these laws in certain countries, while maintaining “tainted” ones elsewhere. This potential divide raises concerns about some markets becoming “dumping grounds” for goods produced with forced labor.
  • With 79% of senior procurement and supply chain leaders acknowledging that compliance with these new laws will demand significant time, money, and resources, there’s an urgent need for comprehensive global legislation to prevent the exploitation of forced labor and ensure ethical practices across all supply chains!
  • Looking to “clean up” your supply chain? Visit our Hot News Page for the latest and greatest Forced Labor and Withhold Release Order (WRO) updates.

Biden Bets Big on ‘Greener’ Pastures

  • President Biden seems to be balancing the scales between supporting allies, addressing climate concerns, and staying competitive in the 2024 Presidential Race as he herds U.S. energy policy toward greener pastures by pausing new natural gas export terminals.
  • The move aims to rein in the galloping exports of liquefied natural gas (LNG), which, despite providing a geopolitical spur against Russia, risk locking in high emissions at a time when Biden has pledged to cut climate pollution in half by 2030.
  • The decision has environmentalists seeing green, as they view it as a step towards addressing climate change—while industry groups and Republicans are kicking up dust, calling it a “win for Russia.”
  • While the action puts a stop to pending and planning LNG projects (temporarily, at least), it doesn’t affect current operations, aiming instead to ensure future projects don’t trample over environmental, economic, or security concerns.
  • Since global environmental policies never come easy, it is interesting to note that some environmentalists fear a return to coal for many current importers of American LNG!
  • One very hot seat is certain… for jumpin’ Joe Biden, it’s the liquid gas, gas, gas!

Yet Another Suez Update

  • Shippers on the Asia-North Europe track have hunkered down around Africa for the long haul, with their eyes locked on the horizon, as they anxiously wait for freight rates to mosey down to a neighborly figure.
  • Despite the shake-up, container hub ports are admirably holding down the fort against the rip tide of off-schedule ships making their rounds.
  • The wild spot rate rollercoaster has seen a sky-high leap of 200% per 40-foot container, although recent weeks have shown the market taking a gentle dip back towards sanity.
  • Unlike the chaos unleashed by the Ever-Given blockade in 2021, Northern European ports are currently navigating the influx of delayed vessels with a calm hand, thanks to lower utilization levels easing the burden.
  • Yet, not all waters are calm, as Rotterdam braces for a storm loaded with full ships and full stacks, while other ports in the range enjoy a quieter spell.
  • Find anything that piqued your interest? Reach out to [email protected] to get the conversation started!

Airfreight’s Fair Fate

  • When isolating international cargo, 2023’s total airfreight volume declined 2.2% from 2022 and 3.8% from pre-Covid 2019. Luckily for those dapper golf-club-toting airline executives, average airfreight rates were somehow higher in 2023 than 2019!
  • January ’24 came out with a roar and volumes did soar by more than a score of four (known as 5%).
  • With problems on Yemen’s shore finding space is a chore, and China’s closing its giant store for more than a typical tour. Thus, rates and volume will remain off the floor.
  • (We hope it’s not poor that we can’t offer more of this top-drawer chore anymore!)
  • Air Cargo News interviewed every single citizen of Earth about airfreight’s prospects for 2024; they began this survey in 1983 to accommodate eight billion participants! Okay, okay, Air Cargo News interviewed about 150 of the most powerful airfreight movers and shakers in the airline, forwarder, and “mega-shipper” categories.
  • 70% of this prestigious group felt optimistic about at least a 3% growth in airfreight demand compared to 2023, and closer to 80% see the global canal(s) crisis as the single largest air demand spur for 2024.
  • As is often the case, over 1/3 of respondents expect Asia Pacific to be the growth leader, but North America, Europe, and Southeast Asia were also identified as positive growth markets with the potential to over-achieve this year.
  • While the Western world is preoccupied with our children’s and our children’s children’s ability to achieve a standard of living equal or better to ours, we often forget about the global growth of the middle class, a middle class that gobbles up medicines, luxury clothing, and exotic perishables. This aspect may be the most cheerful news for airfreight.
  • But, if you are a grumpy cynic who just KNOWS a global depression is lurking around the corner, there is always Ozempic, Wegovy, and Trulicity. (Wait for it!)
  • CBS News recently reported that airline profits and available belly space (ironically) could dramatically increase as more patients lose weight on these diabetes remedies! Hey, we suppose that environmentalists may also dance with glee as we consume less jet fuel!