THE CARGO LETTER 
Air & Ocean Freight Forwarder - Customs Broker News
8 April 1996
Good Monday Morning From World Port L.A. ! We are proud that even the international wire services took note as our Warren Levine filed his daily "China vs. Taiwan" reports via internet from deep within the PRC last month. You may still enjoy the insights of Warren's "China Chronicles", a feature at our WWW site.........http://www.interpool.com/welcome.htm Today Mr. Levine turns our attention to gathering storm clouds over Korea.
Our Top Story
-- by Warren S. Levine for The Cargo Letter
Just when a conflict had been averted between China and Taiwan, the propaganda is beginning to fly again. Beijing's Liberation Army Daily announced yesterday that "China now faces a serious challenge," referring to Taiwan, and that they must step up their air defense capabilities.
Just a week ago, Taiwan's President Lee was proposing liberalization of the shipping regulations regarding vessels calling directly between Mainland and Taiwan ports, which would indeed be a welcome gift to the shipping industry.
But the Korean Demilitarized Zone could be the latest hot-pot in the region. Last Thursday, North Korea announced that they would cease to recognize the agreement that governed the DMZ. South Korea responded by raising their defense alert status a notch.
Over the past few nights, North Korea has sent between 300 and 400 heavily armed troops into the Demilitarized Zone. Under the terms of the 1953 armistice agreement, each side can have no more than 35 military policemen in the area.
The South Korean Army has ordered their front line commanders to "stay ready and on duty for an emergency," and raised their defense preparedness to an even higher level. The United States, which has over 35,000 troops stationed in South Korea, has put their forces on alert as well.
The United Nations Command in Seoul has stated that there is no cause for alarm, and that he does not expect an attack from the North, but that the North's action was "a serious violation" of the armistice.
[Ed note: At press time the S. Korea military upgraded to its "Defense Condition: 2"....for the first time since 1953.]
OUR "A" Section: FF World Trade, Financial & Inland News
Here are today's Stock Watch Report AND progress on our "Cargo Letter 10" portfolio. [portfolio represents $l000 purchase of each stock at close on 3 Nov 1995]
[INDEX: 1st number is the last price............2nd & 3rd Numbers represent how our $1000 investment in each stock is doing and our win/loss to date.]
Our "Cargo Letter 10" winner again this week is Air Express Int'l!.......with Delta Air, Mercury & Interpool being the others in plus territory. Intercargo continues in the rear.
|Airborne Express||ABF||25 1/4||-117.82||881.47|
|Air Express Int'l||AEI||26 1/4||220.92||1,220.88|
|Am. Pres. Lines||APS||23 7/8||-25.51||974.33|
|Fritz Companies||FRTZ||37 1/2||-19.61||980.25|
|Circle Int'l/Harper||HARG||17 7/8||0.00||999.21|
|Intercargo Ins.||ICAR||8 3/4||-222.20||777.70|
|Mercury Air Cargo||MAX||10 3/8||64.10||1,064.06|
And in other financial news..........
The FF Leader Moves Forward.........as Fritz Companies reports revenues & earnings for the 3rd quarter/February 29, 1996, up 16% to US$274.3M from US$237.0M and net revenue (less direct transportation costs) increased 21% to US$118.7M from US$97.8M in the comparable 1995 period. Net income rose 16% to US$10.3M from US$8.9M in the comparable1995 period. Fully diluted earnings per share for the 3rd quarter of 1996 was $0.29 on 36.0 million average shares outstanding compared to $0.27 per share on 33.0 million average shares outstanding in 1995. For 9 months ended February 29, 1996, FCI posted net income of US$35.6M, up 41% from 1995. Revenue was up 29% to US$816.7M. FCI attributes growth to new customers and margin expansion through its continued acquisitions.
Advise Your Shippers of New Customs Regs.......as French Customs will no longer allow medicine or pharmaceutical importation unless CGNEE has authorization from the French Ministry of Health. Although it is currently the rage in America, France now prohibits imports of "melatonin". According to our member Trans Group, German Customs will now reject all imports of polystyrene (including use as inner packing) unless the country of origin is stamped/imbedded in the material.
U.S. Trade Deficit Hits 6 Mo. High..........in Jan '96 to US $10.27 billion, according to a report from the Commerce Department. The trade deficit with Mexico increased to US$1.3 billion and with Japan was up 9.3% from December to US$3.79 billion. The deficit with Canada dropped a bit to US$2 billion. That it was a bad month was also demonstrated by the fact that previous small surpluses for Western Europe, South America and the newly industrialized nations of Asia......each sank into negative numbers. America is not alone, however, as the British worldwide trade deficit widened sharply in January from the figure for December to US$2.17 billion, as exports fell and imports rose.
Japan Does Import Cars?........and indeed sales of imported motor vehicles in Japan jumped 20.9 per cent from a year earlier to 402,608 units in the year to March, hitting a record high for the third year in a row, an industry group said Friday. U.S. imports jumped 32.4 % to 133,362 ["Big Three" car makers rose 18.6% to 42,250 units] . Germany rose 23.3%, France 21.4% and the U.K 15.9%. However, 107,448 units of the total imported came from Japanese plants overseas.
Russia Customs Tightens..........by fixing a list of goods which as of 19 March can be imported only on license to include import plant-protecting chemicals, polishing materials, gunpowder and other explosives, nuclear materials including waste, industrial waste, amber & amber products, precious metals, and drugs.
Making Mercedes-Benz Cars In India.............and it's no wonder at US$99,000 per copy which is a bit more than the usual US$20,000 Indian auto. The 49% Indian owned operation has produced 1000 E-220 class units since October 1995. Continue to watch India.
U.S. Guaranteed Exports to Croatia...........for commodities such as peanuts, wheat, fresh and frozen meat, cotton and leather, the U.S. Dept. of Agriculture is accepting applications to guarantee payment for U.S. shippers & their banks.
OUR "B" Section: FF World Air News
LOS ANGELES - After 108 years of continuous operation, the U.S. Interstate Commerce Commission was legislated out of business by the "ICC Termination Act of 1995" which became effective on 1 January 1996. While this move is generally viewed as one of deregulation by the shipping public, the exact opposite may be true where U.S. freight forwarders are concerned.
Experts seem in initial agreement that the ICC Termination Act requires U.S. domestic freight forwarders to be registered with the U.S. Secretary of Transportation (49 U.S.C. x13903) and will need to carry bodily injury, property damage and cargo insurance in amounts to be prescribed by the U.S. Secretary of Transportation [49 U.S.C. x13906(c)].
Under the Act, a domestic freight forwarder must issue a receipt or bill of lading in connection with all property/freight received for transportation and will be liable for the full actual value of lost or damaged shipments [49 U.S.C. 14706(a)] in the absence of a proper release rate or declared value rate. "I don't know why an airfreight forwarder's airbill wouldn't serve as such a receipt," said Fritz R. Kahn, prominent Washington, D.C. transportation lawyer and former General Counsel of the ICC.
According to Kahn, "neither motor carriers nor domestic freight forwarders need to publish their rates; neither motor carriers nor domestic freight forwarders need to file tariffs with the SURFACE TRANSPORTATION BOARD, successor to the ICC. Therefore, so long as a domestic freight forwarder has a price list setting forth its released rates or declared value rates and gives notice of their applicability on the face of the bill of lading or receipt, I know of no reason why the freight forwarder cannot limit its liability accordingly." "To the contrary," Kahn notes, "Section 49 U.S.C. x14706(c) specifically empowers domestic freight forwarders to establish release rates or declared value rates."
While experts continue to debate ultimate interpretations under the Act, this new law seems to continue to observe prior ICC exemptions under the old law, as follows:
(a) for transportation of property (including baggage) by motor vehicle as part of a continuous movement which, prior or subsequent to such part of the continuous movement, has been or will be transported by an air carrier, or (to the extent so agreed by the U.S. and approved by the Secretary) via foreign air carriers; or,
(b) for transportation of property by motor vehicle in lieu of transportation by aircraft because of adverse weather conditions or mechanical failure of an aircraft or other causes due to circumstances beyond the control of the carrier or shipper.
Passage of the new Act has not been well received by U.S. freight forwarders who have been free of most governmental oversight since the Surface Forwarders Deregulation Act of 1986. Still, the new registration requirements for surface forwarders seemingly require that airforwarders also apply for and receive surface forwarder certification in order to continue the freedom of routing they have been practicing over the past nine years.
OUR "C" Section: FF World Ocean News
Port of New York - Ten New York area warehouse/CFS/terminals took the disquieting step last week of forming what they refer to as an "association" to set uniform rates, prices and conditions of service (i.e. limitations of damage). While NVOCC/freight forwarders must contend with ocean conferences which are exempt from U.S. antitrust regulations, it was not anticipated that the same might ever be said for a CFS/warehouse. When asked in which direction these uniform prices might trend, a source close to the new association supplied the "suprise" suggestion of "UP".
Signatories to the American CFR and Transportation Agreement, include major service providers Railhead CFS, AZ Container Freight Station, Sumo Cargo Services, Cargo Marx, St. George Warehouse Inc., Tritom Distribution Services, GTS Terminals Inc., Nationwide C.F.S., and Van Brunt Port Jersey Warehouse Inc. Is this type of "association" coming to a port near you? [Note: a "CFS" is a container freight station where LCL freight is stripped from a container for individual delivery.]
OUR "D" Section: FFs in Cyberspace
San Francisco- 4 April- U-Freight America has just opened what it claims is the first interactive Internet site, allowing shippers to book space and then track shipments to destination through the World Wide Web. We will follow this site.
>>>>>Trojan Horse Virus........There are widespread reports on the Internet of a new & destructive virus on the net. Do NOT download or expand file called ................. PKZ300B.EXE or PKZ300B.ZIP.......if reports are true, it will erase your hard disk. According to a post sent by Fridrik Skulason to VIRUS-L list on 4 March, PKZ300B.EXE IS a known trojan horse (not a hoax). Skulason is a well known expert in computer viruses, and author of the antivirus software: F-PROT.
Our Featured WWW Site
The National Customs Brokers and Forwarders Association of America.......the parent of all of us as established in 1897...... has a new web page for its members. Access is currently free. After May 1 the cost to NCBFAA members will be $50.00 per month plus $10.00 per additional password. http://www.tradecompass.com/ncbfaa/fabnet/
Aerolog Express (EU)
Consolidated Freightways,Inc. (NYSE: CNF)
http://www.cnf.com [for investors]
Karl Schroff & Associates, Inc
Commission of the EUROPEAN COMMUNITIES
EDI Issues/Peter Jones
MONSTED CHARTERING - Denmark
Brazilian Business Directory
International Trade Show Calendar
IRF Geneva Web Site
Railroads, Ships and Aircraft Homepage
Singapore Economic Development Board
World Government Sites
Big Book Yellow Pages (U.S. Business & Residential) [a search engine for
Dictionary of Occupational Titles (DOT) Index
Japanese To English Translation (FREE)
Linguistic-Related Links (translators)
Maps in the News
Morse Code Translator
Tracking How The U.S. Congress Votes
World Population Figures
http://www1.tip.nl/users/t865190/index.html [an error occurred while processing this directive]