Posted on: Feb 11, 2016
As the industry prepares for the controversial new verified weight rules that go into effect this July, the Port of Charleston is the first U.S. port to say it is willing to provide in-terminal weighing services for containers if it is allowed by the U.S. Coast Guard. In doing so, Charleston is lining up with terminals in Europe and the Mideast that say they will offer weighing services, but is diverging from several U.S. terminals – including arch competitors Savannah and Virginia, which are explicitly saying they will not offer yard equipment to weigh containers on behalf of shippers.
U.S. ports have long weighed containers on site in order to comply with workplace safety regulations, said Jim Newsome, president and CEO of the South Carolina Ports Authority. There is no reason it can’t be a service ports offer to shippers when the International Maritime Organization’s Safety of Life at Sea (SOLAS), rules take effect July 1, Newsome said. With several other U.S. terminals taking the exact reverse approach, in other words not allowing in containers without the shipper-provided Verified Gross Mass (VGM) and not offering weighing services, Newsome said he hopes Charleston can provide a “constructive solution that helps the shipping industry” grapple with the SOLAS amendment. Without any guidance from the U.S. Coast Guard on the matter, Charleston’s proposed “solution” has led to more questions than answers.
The Coast Guard is the agency that implements SOLAS rules in the U.S. as it has jurisdiction over vessels and marine terminals. The Coast Guard, however, could not provide any guidance as to whether Charleston has the appropriate equipment to verify container weights.
The new SOLAS rule requires shippers whose name appears on the bill of lading to verify the gross mass of a packed container when tendering the container to ocean carriers and terminals. They can do this by either weighing a fully packed container, called Method 1, or weighing the cargo, palleting, packaging and securing materials separately and adding it to the tare weight, or unloaded weight, of the container, called Method 2. Each of the 162 countries that are signatories to SOLAS will be tasked with ensuring the gross mass of containers is verified, without which the boxes can legally not be loaded on board a ship. Newsome in an interview with the Journal of Commerce explained how the port at Charleston is fully outfitted with scales capable of weighing containers. With some minor procedural understandings, he said, Charleston could provide a solution to the SOLAS requirement. According to Newsome, the need to weigh cargo has been a longstanding requirement of the Occupational Safety and Health Administration. Scales on the Charleston waterfront weigh the gross unit and subtract the tractor weight provided by truck drivers. “This is our process, we weigh every export container, have done so for years, and these are the weights used by the lines and the stevedores in loading ships, preparing stow plans, etc,” Newsome said.
There are some “hanging chads,” explained Newsome, which would need to be resolved before the port begins to weigh containers for compliance under the new regulations, though. Charleston’s scales are calibrated, but that does not mean the weights are certified, as required by the new regulations. Moreover, there remains the question of how shippers will adopt weights as “certified weights.” Newsome said he believes this could practically be done by having shippers say they accept the terminal provided weights as meeting their responsibility for certification as part of their shipping instructions to the lines. Both of those concerns will need to be resolved by the U.S. Coast Guard, which has yet to provide any official guidance, though it is expected to publish a policy letter later this month.
In the meantime, container terminal operators outside of Charleston have been reluctant to provide clarity on how they plan to handle the verified weight rule, other than to tell carriers privately that they don’t want to accept containers through their in-gates without the VGM. At least 11 other U.S. container terminals have told one of the large container lines that they will refuse to admit containers that arrive at the gate unaccompanied by a signed VGM provided by the shipper. Few terminals seem to believe there is a viable business model in conducting weighing on behalf of shippers and charging them a fee, given the requirement to invest in weighing equipment and find space for the weighing process and associated storage. But given the persistent questions from shippers about how they will comply with the VGM, a situation in which containers are weighed at the terminal would offer a potentially straightforward solution that would sidestep many issues shippers say they are struggling with in developing a strategy for compliance.
Where shippers can weigh their cargo is not the only question remaining as the July 1 VGM deadline nears. As that deadline gets closer and questions grow larger in number, many in the industry are now pushing the Coast Guard to delay implementation stateside. The Coast Guard can legally delay implementation of the VGM rule for a year by notifying the International Maritime Organization(IMO) before July 1. U.S. exporters this month called on the Coast Guard to delay the rule until it can be amended and determined that they won’t face a competitive disadvantage against foreign exporters. If the Coast Guard does delay implementation, they won’t be alone. Just this week, Russia said it plans to ask the IMO later this month to delay the VGM roll out for shippers there. The Coast Guard will host a meeting today (Feb. 18) on the VGM mandate at Federal Maritime Commission (FMC) headquarters in Washington. Stay tuned as more develops.