US House passes Ocean Shipping Reform Act of 2022

US House passes Ocean Shipping Reform Act of 2022

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Bill is aimed at easing shipping disruptions that have affected agricultural imports and exports.

The Ocean Shipping Reform Act of 2022 (S. 3580), aimed at easing shipping disruptions, passed the U.S. House of Representatives on a 369-42 vote on June 13.

The act, which is expected to be signed soon by President Joe Biden, increases the authority of the Federal Maritime Commission (FMC) to promote the growth and development of U.S. exports. It requires the FMC to investigate complaints about late fees charged by ocean carriers to determine whether those charges are reasonable, and order refunds for unreasonable charges. It also prohibits common ocean carriers, marine terminal operators, or ocean transportation intermediaries from unreasonably refusing cargo space when available or resorting to other unfair or unjust discriminatory methods.

Agriculture groups, whose imports and exports are among the many affected by port disruptions in recent years, applauded the passage.

“Record-high shipping costs and delayed access to containers have worsened supply chain issues and limited exports at a time when the world is calling on America’s farmers to meet growing demand,” said American Farm Bureau Federation President Zippy Duvall in a statement. “Some estimates suggest we’ve lost out on more than $25 billion in agricultural exports over the past six months because of ocean shipping constraints. That’s unacceptable. Limited trade has also made it more difficult to import supplies like fertilizer, which increases costs to farmers and ultimately hurts all families through higher grocery bills.”

Duvall said he looks forward to Biden quickly signing the measure into law “so farmers and ranchers can continue to meet the needs of families in America and overseas.”

The American Feed Industry Association (AFIA) said the issues addressed in the bill have resulted in the animal feed industry incurring unreasonably high costs for doing business and unnecessary detention and demurrage fees.

“Our members have been caught between the devil and the deep blue sea over the past few years, having difficulty exporting animal feed, feed ingredients and pet food products that their foreign buyers need, while battling the undercurrent of exorbitant rate and fee increases for containers and logistical nightmares for both imports and exports,” AFIA President and CEO Constance Cullman said in a statement. “While we know that the next few months will not be smooth, we are hopeful that the passage of the Ocean Shipping Reform Act signals a course correction that will enable our industry to continue providing these essential goods to the global marketplace in a timely, cost-efficient way.”

In a statement, Biden said the Ocean Shipping Reform Act would help lower costs for American retailers, farmers and consumers.

“During the pandemic, ocean carriers increased their prices by as much as 1,000%. And, too often, these ocean carriers are refusing to take American exports back to Asia, leaving with empty containers instead. That’s costing farmers and ranchers – and our economy – a lot of money,” Biden said. “This bill will make progress reducing costs for families and ensuring fair treatment for American businesses – including farmers and ranchers.”