China Export Pain Mounts as Tariffs Bite

November 27, 2019

China’s exports to the U.S. contracted heavily again last month as the ongoing trade impasse between the world’s two largest economies continued.

China’s export growth in greenback terms improved to a negative 0.9% year-over-year (y/y) in October, after a y/y decline of 3.2% in September.

Export growth to the U.S. rose to -16.2% y/y in October from -21.9% in September, due mainly to a low base in October 2018, noted Japanese financial services group Nomura.

Export growth to the U.S. last month was still below the monthly average growth of negative 15.1% in the third quarter, which the analyst suggested was due to “strong drag” from existing higher U.S. tariffs.

“Despite the upticks in October, we see strong headwinds for China’s export growth in coming months, given existing punitive U.S. tariffs, slowing global manufacturing and the tech downswing,” said Nomura.

For the full story, please click HERE

Source: American Shipper

U.S.-China Trade Uncertainty: Section 301 Tariff State of Play

November 26, 2019

The Situation: Recent reports indicate that the United States and China may soon reach an initial, limited trade deal that could involve the United States phasing out some existing tariffs on Chinese-origin goods while refraining from imposing a new round of tariffs scheduled for imposition on December 15, 2019.

The Result: Since July 2018, the United States government has imposed billions of dollars in tariffs on Chinese-origin goods pursuant to Section 301 of the Trade Act of 1974 (“Section 301”). During September 2019 alone, the United States collected approximately $7 billion in tariffs on imports of Chinese-origin goods. Although limited relief may be in store, until a comprehensive resolution of the “trade war,” companies with trans-Pacific trade or supply chains will contend with the threat of additional tariffs.

Looking Ahead: Companies should continue to consider and take advantage of options to mitigate or avoid paying Section 301 duties. This includes monitoring product exclusions granted by the United States Trade Representative (“USTR”) for goods included on the first three lists of Chinese-origin products subject to Section 301 tariffs and filing product exclusion requests for goods on the fourth list of Chinese-origin products subject to Section 301 tariffs and any other future lists.

Reports indicate that the trade deal could involve the United States refraining from imposing new tariffs on approximately $155 billion in goods that were scheduled to go into effect on December 15 (the so-called “List 4B” tariffs), but also that the United States would eliminate duties on the $110 billion worth of goods imposed in September 2019 (“List 4A”). There also reportedly has been discussion about lowering the 25% duty on approximately $250 billion worth of goods imposed over the last year and a half (“Lists 1-3”). Despite these reports, President Trump has refuted the idea that the United States had agreed to roll back all Section 301 tariffs on Chinese-origin goods, and has indicated that the United States will increase tariffs on Chinese-origin goods if the two countries cannot reach an agreement.

For the full story, please click HERE


Canadian National and Teamsters Reach Deal to End Strike

November 26, 2019

Canadian National and the Teamsters reached a tentative agreement to end the rail strike by about 3,200 rail workers.

Normal rail operations resume at 6 a.m. tomorrow, Nov. 27, Teamsters Canada and CN said in on Nov. 26.

“We want to thank our customers for their patience and support and assure them that CN is preparing to resume full rail operations as soon as possible,” said CN CEO JJ Ruest said in a statement.

CN conductors, transpersons and yard workers went on strike on Nov. 19. The strike has hit supply chains across Canada, bringing trade disruptions, goods shortages and layoffs.

Details of the agreement have not been disclosed. But the CN workers have pushed for changes in working conditions, citing safety concerns, in addition to better benefits.

For the full story, please click HERE

Source: Freight Waves

Pre-Thanksgiving Snowstorm Spreading From Central Rockies to the Plains and Upper Midwest

November 26, 2019

At a Glance
– A snowstorm will continue to track from the Rockies to the Plains and upper Midwest into Wednesday.
– Snow and strong winds will impact pre-Thanksgiving travel.
– Snowfall totals of 6 to 12 inches are likely along the path of the storm in the Plains and upper Midwest.
– Up to 2 feet of snow is expected near the Front Range of the Rockies.

A pre-Thanksgiving snowstorm is hammering the Front Range of the Rockies and will spread toward the upper Midwest with wind-driven snow into Wednesday.

The Weather Channel has named this system Winter Storm Dorothy.

Happening Now
Snow is ongoing this morning from Colorado and Wyoming to parts of Nebraska and northwest Kansas.

The Denver metro area has already picked up 7 to 12 inches of snow. Western sections of Boulder, Colorado, have seen up to 20.5 inches. The top storm total so far is 33 inches near Drake, in the foothills southwest of Fort Collins.

A portion of Interstate 80 has been closed in southeast Wyoming. Stretches of Interstate 76 and Interstate 70 have also been closed in northeast Colorado. See the link below for more updates on the impacts from this storm.

Forecast Timing

Tuesday-Tuesday Night
Snow, combined with winds gusting 30 to 40 mph, will cause travel problems in the Central Plains on Tuesday, including southeastern Wyoming, northeastern Colorado, northwestern Kansas, southern South Dakota and much of Nebraska. Blowing and drifting snow from this storm will impact stretches of interstates 25, 70 and 80.
The snow and wind will also spread farther northeast across the upper Midwest later Tuesday and Tuesday night. Sioux City, Iowa; Minneapolis; Rochester, Minnesota; and Marquette, Michigan, will all see accumulating snow and strong winds during this time. Travel should be avoided in all of these areas, particularly Tuesday night.

Snow and wind will continue from the upper Mississippi Valley into the northern Great Lakes Wednesday. The strong winds will contribute to more blowing and drifting snow in these areas, resulting in dangerous travel conditions.

The snow will taper off from southwest to northeast during the day. Most of the snow will be done by evening.
Strong winds from the storm will also impact a large area of the Midwest and Great Lakes. Those winds could contribute to flight delays or cause localized power outages.

Snowfall Forecast
Widespread snowfall accumulations of 6 to 12 inches are likely along the path of this storm.

This includes an area from northeastern Colorado and southeastern Wyoming to central Nebraska, northwest Iowa, southeastern South Dakota, southeastern Minnesota, northern Wisconsin and the Upper Peninsula of Michigan.

Parts of southeastern Wyoming and northeastern Colorado, including Cheyenne, Wyoming, and Boulder and Fort Collins, Colorado, could receive 12 to 20 inches of snowfall from this storm.

For the full story, please click HERE

Source: The Weather Channel

Canadian National Strike Strands Shippers, Ripples Through Supply Chains

November 25, 2019

Canadian National Railway (CN) is operating at roughly 10% capacity after nearly one week of a conductors’ and yard operators’ strike, stranding ag shippers and propane shipments at a crucial time for Canadian farmers. “Currently, very limited amounts of various commodities are moving across the country. This includes container traffic to keep Canada’s ports fluid to be able to return to normal operations after the strike,” the railroad said in a statement Friday. The 10% of CN’s capacity still operating is due to the railroad’s administrative employees that possess the needed qualifications.

As of Thursday, negotiations were ongoing “with the help of federally appointed mediators,” according to a statement from the railroad’s CEO JJ Ruest.

Dozens of farmers took their tractors to the streets of Montreal Friday in a rolling protest, calling for a resolution to the dispute, which the Teamsters Canadian Rail Conference says revolves around working conditions and prescription benefits. The workers have been without a contract since July 23.

The knock-on effects of any freight strike start with the goods rarely transported any other way. Propane — essential for heating and to the agricultural industry in Canada and the Midwestern U.S. — is one such product.

“Rail transportation is extremely important for the propane industry and for Canadians who depend on propane for their homes, businesses, farms and fleets every day,” Nathalie St-Pierre, CEO of the Canadian Propane Association, said in a statement. Much of Western Canada’s grain crops remain unharvested and propane is essential to keeping grain dry and barns warm in the colder months, along with transporting grain once harvested.

Authorities say Quebec is at risk of running out of propane if the strike doesn’t end soon. The teamsters contend that CN is inflating the level of disruption to the propane supply, according to Bloomberg. A total of 3,200 teamster members are striking, but the union says 1,800 locomotive engineers and 600 supervisors can cross picket lines, meaning they can still work. Lyndon Isaak, president of the union, told Bloomberg this should be enough to keep Quebec and Ontario supplied with propane.

For the full story, please click HERE

Source: Supply Chain Drive