{"id":7417,"date":"2021-10-19T09:36:20","date_gmt":"2021-10-19T13:36:20","guid":{"rendered":"\/?p=7417"},"modified":"2023-02-02T09:41:50","modified_gmt":"2023-02-02T13:41:50","slug":"remarks-of-commissioner-rebecca-dye-2021-south-carolina-international-trade-conference","status":"publish","type":"post","link":"\/remarks-of-commissioner-rebecca-dye-2021-south-carolina-international-trade-conference\/","title":{"rendered":"Remarks of Commissioner Rebecca Dye 2021 South Carolina International Trade Conference"},"content":{"rendered":"<p>Thank you so much for inviting me to be here today. What a pleasure to be with you\u2026really with you! I read that Nassim Taleb, author of the Black Swan, said that the global pandemic is not a Black Swan, because we had prior warnings \u2026 But what\u2019s been going on globally sure seems like a Black Swan to many of us.<\/p>\n<p>Today, I\u2019d like to share with you my perspective on the supply chain dislocations that we\u2019ve experienced, and what I plan, going forward, with the Fact Finding 29 Investigation.<\/p>\n<p>My goal not to find fault, or to place blame, but to <em>change<\/em> critical port congestion and supply chain bottlenecks. To increase supply chain reliability and resilience requires closer coordination and visibility among exporters, importers, ocean carriers, truckers, marine terminals and seaports, longshore labor, railroads and rail ramps, chassis providers, ocean transportation intermediaries, warehouses, and distribution centers, and everybody in between!<\/p>\n<p>There are <strong>three major obstacles<\/strong> to increasing operational harmony to address congestion and other supply chain dislocations in the United States today:<\/p>\n<ol>\n<li>The major operational problems we are experiencing today are not new and will not necessarily resolve when the pandemic has subsided. They are exacerbated in every cargo \u201csurge\u201d or \u201cpeak season;\u201d<br \/>\n<div class=\"su-spacer\" style=\"height:10px\"><\/div><\/li>\n<li>No supply chain actor alone, not ocean carriers, or seaports, or shippers, can improve supply chain performance without a coordinated, harmonized approach among them. Everyone owns and is responsible for a piece of the puzzle; and<br \/>\n<div class=\"su-spacer\" style=\"height:10px\"><\/div><\/li>\n<li>The lack of mutual understanding and commitment among parties in the supply chain, especially parties to service contracts for freight, will keep us from <em>harmonizing<\/em> our freight delivery system and <em>improving<\/em> supply chain performance.<\/li>\n<\/ol>\n<p>Without mutual commitment, a \u201cmeeting of the minds\u201d there is no contract. Without that, shippers cannot obtain price and space certainty and ocean carriers cannot be prepared to meet their customers\u2019 needs. It\u2019s as if negotiating parties shake hands and say, \u201cwe really hope this works out.\u201d I\u2019ve told shipper groups that they must get greater price and volume certainty in their freight contracts to protect themselves. Contractual certainty will go a long way to addressing this persistent problem of uncertainty surrounding forecasting of capacity needs that keeps ocean carriers from planning capacity for their customers.<\/p>\n<p>Fact Finding 29 is my fourth major Commission investigation. My first investigation started in March 2010, when American companies decided to restock all at the same time, following the extreme drop in demand at the end of the home mortgage crisis. Ocean carriers had laid up over 500 ships worldwide and some had been carrying freight on certain trade lanes for free simply to avoid a ship layup. My main finding from that investigation was that a lack of mutual understanding and commitment between ocean carriers and their customers stands in the way of shippers and carriers realizing their business goals.<\/p>\n<p>The current Commission Order on Fact Finding 29 authorizes me, as investigating officer, to form FMC Supply Chain Innovation Teams to develop commercial solutions to port congestion and related supply chain challenges during the pandemic. Why commercial solutions? Because in a complex system, like our international ocean freight delivery system, commercial solutions minimize the risk of unintended consequences in the marketplace. We could make it worse!<\/p>\n<p>Identifying problems is the easy part. We can see the obvious bottlenecks that cause the supply chain to fail. Identifying the commercial decisions and the related commercial reactions that disrupt the system and contribute to the problems, is the hard part.<\/p>\n<p>FMC Supply Chain Innovation Teams is an approach I designed to find innovative solutions for supply chain challenges. FMC Innovation Teams are not round tables or advisory boards. These small Teams are selected from industry leaders with the knowledge, the experience, and the willingness to change the system. Team members are asked to \u201cstep out of their silos\u201d and engage with other supply chain actors from the <em>perspective<\/em> of the overall freight delivery system, not their company perspective.<\/p>\n<p>As a continuation of Fact Finding 29, I am assembling \u201cmini\u201d Innovation Teams on container availability, container return, and earliest return date. Like so many others, I\u2019ve found that virtual meetings are not successful for tough team engagement. Now that we can travel, I plan to hold meetings of ocean carrier and port terminal executives in Washington, starting after Thanksgiving.<\/p>\n<p>I continue to support the work of the Federal Maritime Commission\u2019s Memphis Supply Chain Innovation Team, that works to promote better chassis availability processes in the Memphis rail ramps and possibly to address other related problems.<\/p>\n<p>The FMC has reformed our enforcement approach of the FMC\u2019s demurrage and detention rule with additional enforcement investigations, new complaints processes, and a new FMC carrier compliance program. I certainly wouldn\u2019t have chosen to propose a change in the <em>international<\/em> system of demurrage and detention charges, for the first time in the world, in the middle of a pandemic shutdown. But we\u2019re determined to enforce the law and change the way these charges are applied.<\/p>\n<p>I have recently submitted Interim Fact Finding 29 Recommendations to the Commissions and to Congress and will also submit Final FF29 Recommendations for future Commission action.<\/p>\n<h3>Future Change to Grow<\/h3>\n<p>Today, our extreme supply chain disruptions have showed us that our international ocean freight delivery system is unprepared to deal with growing volumes of cargo flowing through our major seaports. We also know that there is no easily identifiable solution to major supply chain dislocations. Rather, there are complex interactions among supply chain actors, and each actor plays a part in improving or impairing supply chain performance.<\/p>\n<p>We should move forward with supply chain solutions developed with today\u2019s challenges in mind not backwards to failed proscriptions from a common carriage regulatory regime of the past. A supply chain innovation that holds promise for future supply chain performance is the National Port Information System, envisioned by the first FMC Innovation Teams. These teams met in Washington following the major congestion in the ports of Los Angeles\/ Long Beach beginning in 2014.<\/p>\n<p>Three FMC Innovation Teams composed of major US shippers, ocean carriers, railroads, truckers, seaports, and others agreed that end-to-end <em>visibility<\/em> is key to greater supply chain reliability and resilience. You often hear people say, \u201cthey just need to learn to share information.\u201d That\u2019s not really the problem.<\/p>\n<p>To harmonize the supply chain, our freight delivery system, supply chain actors must be informed of exactly what they need to know, when they need to know it. Business processes may need to change to be able to tell people what they need know. People don\u2019t behave irrationally, at least not people who manage to stay in business. They behave according to what they know at any one time.<\/p>\n<p>Today, we\u2019re flying blind and it\u2019s no surprise that we\u2019re crashing into each other. We all know that if we don\u2019t change, we can\u2019t grow. But if we can change, no, <em>when<\/em> we change, our international economic competitiveness will grow, and the United States will prosper.<\/p>\n<p>Good day and thank you again.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Thank you so much for inviting me to be here today. What a pleasure to be with you\u2026really with you! I read that Nassim Taleb, author of the Black Swan, said that the global pandemic is not a Black Swan, because we had prior warnings \u2026 But what\u2019s been going... <a class=\"read-more\" href=\"\/remarks-of-commissioner-rebecca-dye-2021-south-carolina-international-trade-conference\/\">Read More »<\/a><\/p>\n","protected":false},"author":7,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":[],"categories":[9,6],"tags":[],"acf":[],"_links":{"self":[{"href":"https:\/\/www.fmc.gov\/wp-json\/wp\/v2\/posts\/7417"}],"collection":[{"href":"https:\/\/www.fmc.gov\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.fmc.gov\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.fmc.gov\/wp-json\/wp\/v2\/users\/7"}],"replies":[{"embeddable":true,"href":"https:\/\/www.fmc.gov\/wp-json\/wp\/v2\/comments?post=7417"}],"version-history":[{"count":3,"href":"https:\/\/www.fmc.gov\/wp-json\/wp\/v2\/posts\/7417\/revisions"}],"predecessor-version":[{"id":7426,"href":"https:\/\/www.fmc.gov\/wp-json\/wp\/v2\/posts\/7417\/revisions\/7426"}],"wp:attachment":[{"href":"https:\/\/www.fmc.gov\/wp-json\/wp\/v2\/media?parent=7417"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.fmc.gov\/wp-json\/wp\/v2\/categories?post=7417"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.fmc.gov\/wp-json\/wp\/v2\/tags?post=7417"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}