Keep your business up to speed with the latest news.
Port of Houston shakes up storage fee structure
The Port of Houston will no longer charge storage fees on import containers left at its marine terminals when truck gates are closed. However, it will increase per diem charges, the Journal of Commerce reported.
The port is reacting to a crackdown by the Federal Maritime Commission (FMC), which followed major changes to US ocean shipping laws authorized by President Joe Biden last year. The port said it would charge some containers a 32% higher per diem fee to insure against congestion when gates are closed.
Detention & Demurrage (D&D) charges became a hot-button topic during the post-pandemic trade rebound. Many shippers complained that they were being charged fees by terminals to store containers even though they were unable to access the boxes to remove them. Ocean carriers responded to the new shipping laws by waiving D&D charges on days when marine terminals are closed. And the Port of Houston is anticipating new laws prohibiting marine terminals from charging in similar periods. However, the port stresses it still needs to ensure shippers move cargo on time to avoid congestion even when gates are closed.
“The purpose of these proposals is to continue to incentivize the movement of cargo, respond to developments in applicable law and precedent, and adjust related financial measures,” the port said in an advisory.
Under new rules introduced on May 1st, shippers who leave imported cargo at the two terminals past allotted free time will not incur demurrage fees for days when “gates are closed for scheduled terminal closures.” Shippers will continue to have seven free days of storage once a box is available for pickup.
But the demurrage rate for a 40-foot container has risen from $66.36 per day to $87.77/day. Rates for a 20-foot container will increase to $43.89/day from $33.19/day.
Vietnam looks to support its handicrafts industry
Vietnam’s Tien Giang province in the Mekong Delta has formed 14 cooperatives and is driving to increase quality and variety as it looks to find ways to link its burgeoning handicrafts industry with Western buyers, VietnamPlus news reported.
The Southeast country’s handicrafts have become increasingly popular with home and design retailers in the West. Items made of water hyacinth wicker, wood carvings, and sedge mats have proved a particular hit. Vietnam’s 1500 craft villages also produce items such as wooden furniture, porcelains, lacquers, embroidery, candles, jewels, artificial flowers, and glass products.
Handicraft cooperatives in Tien Giang province earn about $5 million in exports per year, according to Vietnam’s state news agency VNA. The biggest export market is the US, which accounts for around 35% of total handicraft exports, followed by Japan, the EU, Australia, and South Korea.
Deputy Chairman of the provincial Union of Cooperatives, Le Minh Khanh, said craft villages played an important role in creating jobs and incomes for rural people. He cited examples such as the Long Dinh Mat Knitting village in Chau Thanh district, which has produced patterned sleeping mats for over 70 years.
Vietnam is undergoing a program of training craft workers in the villages to help expand its offering and to upskill craft workers in areas like IT and health and safety.
The country’s ‘One Commune-One Product’ program aims to increase handicraft workers’ income by at least 150% compared to 2020 levels and ensure that all products comply with environmental standards. This is important to Western buyers because Vietnam’s handicraft industry is facing stiff competition from the country’s fast-growing manufacturing sector to attract labor.
The country has seen manufacturers, including Apple supplier Foxconn, Samsung, and LG, invest in its electronics sector. But this has led to increasing fears that handicrafts workers might move to urban areas to seek higher wages working in factories, abandoning the sector.
One of Asia’s most prominent trade fairs makes its return
One of Asia’s most significant trade fairs for the tech industry is to make its post-pandemic return this month. Doors will soon open at Computex Taipei – one of Asia’s largest and most significant IT trade shows and a vital diary entry for many SMBs looking to source in Asia.
The show focuses on IT trends like AI, IoT, and 5G and reunites over 1,600 exhibitors and more than 130,000 visitors. This year’s Computex Taipei will be held at the Taipei Nangang Exhibition Center, Halls 1 and 2, from May 30 to June 2.
This year marks the full physical return of the event, which was last held in 2019. The event has selected six major themes: high-performance computing, artificial intelligence applications, next-gen connectivity, hyperreality, innovations and startups, and sustainability.
Global disruptions to supply chains caused by geopolitical tension, trade wars, and increased perceptions of risk have led many businesses to look beyond China for sourcing. Yet even as companies adopt new sourcing policies such as China plus One or friend shoring, China’s trade fairs continue to be major events for many purchasers.
Other events to note in the diary include the Hong Kong Electronics Fair, which will hold its Autumn edition at the Hong Kong Convention and Exhibition Centre from 13 to 16 October 2023. It will run alongside companion events electronicAsia, the HKTDC International ICT Expo, HKTDC Hong Kong International Lighting Fair (Autumn Edition), and the HKTDC Hong Kong International Outdoor and Tech Light Expo.
Buyers looking for the latest eye-catching gifts in their homes and living spaces should look to 6-8 September. Japan’s largest B2B lifestyle and gift trade show, the Tokyo International Gift Show, will be held in Tokyo Big Sight, Tokyo International Exhibition Center. Organizers have promised to expand the size of the autumn show after a successful spring return following the pandemic.
Fashion brands demand inflation discounts from suppliers
Fashion suppliers in Asia will be watching anxiously for signs that customers are looking to pass on inflation costs by demanding discounts.
UK clothing retailers Frasers Group reportedly requested a 10% discount off outstanding payments and a 20% discount off ordered goods for spring-summer 2023, Just Style published. This was reportedly followed by fellow UK brand Boohoo, which demanded a 10% discount from suppliers to ” capture deflation in a timely manner,” the publication said.
Meanwhile, annual trade data released by the US’s Office of Textiles and Apparel (OTEXA) and the US International Trade Commission (USITC) showed that China’s apparel industry seemed to be shrugging off the effects of Covid lockdowns and trade wars. The figures revealed that despite supply chain controversies around Xinjiang cotton, China was still by far the largest source of apparel for the US market in 2022.
However, Associate professor in the Department of Fashion and Apparel Studies at the University of Delaware Sheng Lu told Just Style China’s market shares had fallen. He said the drop reflected attempts by US fashion companies to reduce “China’s exposure” and diversify supply chains.
China’s apparel suppliers are reported to be in heavy attendance at trade fairs worldwide as they, in turn, look to diversify their customer base and create new markets for apparel.
It may therefore be a good time for new buyers to make contact with China’s resurgent apparel companies.
Vietnam, India set to be major beneficiaries of supply chain shake-up
Global economic turbulence, geopolitical disruptions, and trade wars are shaking up supply chains, and Vietnam and India are set to be among the biggest beneficiaries, economists believe.
An overwhelming majority of global economists (73%) surveyed as part of the World Economic Forum (WEF) Chief Economic Costs Outlook for May 2023 believed South Asia – especially Vietnam and India – would benefit from the changes. The WEF regularly canvasses senior economists worldwide on global economic trends for quarterly reports.
“Almost three-quarters of the chief economists surveyed expect assertive industrial policy to become increasingly widespread over the next three years,” said the report.
91% of respondents anticipated deeper geoeconomic tensions, and 70% feared stifled competition (70%).
“When asked about the business strategies that are likely to determine the shape of global supply chains over the next three years, the chief economists highlighted adaptation to geopolitical fault lines (94%), prioritization of resilience over efficiency (91%), diversification of suppliers (84%) and an increasing focus on environmental sustainability (77%),” said the report. Respondents anticipated China to be especially hard hit by changes to global supply chains, with 75% expecting supply chain restructuring to impact China’s economy more than any other country negatively.
South and East Asia and the Pacific region are expected to benefit most from the change. Vietnam, India, Thailand, and Indonesia will likely be particular beneficiaries.
Changes to global supply chains major industry will most affect industries like semiconductors, automotive, pharmaceuticals, food, energy, and the broader technology sector.
Therefore, companies looking to source overseas should be prepared to invest time exploring new sourcing destinations – especially Vietnam and India. In these economies, lower wages will help offset some of the teething problems associated with learning to source for a broader global customer base.
Despite its supply chain woes, global economists were near-unanimous that China would see moderate growth at the very least this year.
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