Executive Briefings

Study of U.S. Inland Containerized Cargo Moving Through Canada, Mexico Is Released

Carriers shipping cargo through Canadian and Mexican ports do not violate any U.S. law, treaty, agreement or Federal Maritime Commission regulation, according to an FMC study prompted by members of Congress.

Some elected officials sought to understand the impacts and the extent to which the U.S. Harbor Maintenance Tax other U.S. policies and other factors may incentivize U.S.-bound container cargo to shift from U.S. seaports to those in Canada and Mexico.

The study, entitled U.S. Inland Containerized Cargo Moving Through Canadian and Mexican Seaports, examines the competitiveness of Mexican and Canadian ports with U.S. West Coast ports; discusses the history and the theories of cargo diversion of the HMT; reviews ocean freight rates, transit times and rail charges; and examines other potential relevant factors influencing the movement of cargo. A case study of the Canadian Port of Prince Rupert, in British Columbia, is included.

The study also finds that numerous factors account for why shippers elect to use ports in Canada and Mexico, including overall shipment savings, risk mitigation through port diversification, perceived transit time benefits, avoidance of the HMT, and rail rate disparities; and that there are many options available to Congress should it decide to revise or replace the current HMT structure.

The study confirms previous estimates that a significant amount of containerized cargo imports moving through the Ports of Oakland, Seattle, Tacoma and Portland on the U.S. West Coast may be vulnerable to Canada routing.

Federal Maritime Commission Chairman Richard A. Lidinsky Jr. stated, "This study provides facts U.S. policymakers can rely upon as they make the important choices affecting this country's ability to compete in a global transportation marketplace."

The Federal Maritime Commission is the independent federal agency responsible for regulating the nation's international ocean transportation.

Source: Maritime Executive

Some elected officials sought to understand the impacts and the extent to which the U.S. Harbor Maintenance Tax other U.S. policies and other factors may incentivize U.S.-bound container cargo to shift from U.S. seaports to those in Canada and Mexico.

The study, entitled U.S. Inland Containerized Cargo Moving Through Canadian and Mexican Seaports, examines the competitiveness of Mexican and Canadian ports with U.S. West Coast ports; discusses the history and the theories of cargo diversion of the HMT; reviews ocean freight rates, transit times and rail charges; and examines other potential relevant factors influencing the movement of cargo. A case study of the Canadian Port of Prince Rupert, in British Columbia, is included.

The study also finds that numerous factors account for why shippers elect to use ports in Canada and Mexico, including overall shipment savings, risk mitigation through port diversification, perceived transit time benefits, avoidance of the HMT, and rail rate disparities; and that there are many options available to Congress should it decide to revise or replace the current HMT structure.

The study confirms previous estimates that a significant amount of containerized cargo imports moving through the Ports of Oakland, Seattle, Tacoma and Portland on the U.S. West Coast may be vulnerable to Canada routing.

Federal Maritime Commission Chairman Richard A. Lidinsky Jr. stated, "This study provides facts U.S. policymakers can rely upon as they make the important choices affecting this country's ability to compete in a global transportation marketplace."

The Federal Maritime Commission is the independent federal agency responsible for regulating the nation's international ocean transportation.

Source: Maritime Executive