Klobuchar: “The sheer act of passing this bill will send a major message to the foreign-owned ocean shipping industry that it is time to ship our goods out of America and to charge our American manufacturers and our American farmers and thus our consumers a fair rate.”
WASHINGTON - On the Senate floor, U.S. Senator Amy Klobuchar (D-MN) called on her colleagues to pass the Ocean Shipping Reform Act, her bipartisan legislation with Senator John Thune (R-SD) to boost exports and ease shipping backlogs.
The Ocean Shipping Reform Act passed the Senate Commerce Committee unanimously on Tuesday. The bipartisan legislation will level the playing field for American exporters by making it harder for ocean carriers to unreasonably refuse goods ready to export at ports.
“The sheer act of passing this bill will send a major message to the foreign-owned ocean shipping industry that it is time to ship our goods out of America and to charge our American manufacturers and our American farmers and thus our consumers a fair rate,” Klobuchar said.
Klobuchar highlighted the significant supply chain disruptions and vulnerabilities U.S. exporters face, caused by international ocean carriers who unreasonably decline shipping opportunities while reaping record profits.
“U.S. companies have only been able to ship 60% of their orders because they can't access shipping containers during certain parts of this pandemic…At the same time, ocean carriers, almost all foreign-owned, have reported record profits,” said Klobuchar. “They are fleecing consumers and exporters because they know they can get away with it and this is all while consumers are paying the price literally for the supply chain disruptions caused by their unreliable service. We need to get exports to those who need them, we need to be a country that makes stuff, invents things, exports to the world.”
The legislation earned the endorsement of the American Association of Port Authorities, which represents more than 130 port authorities across North and South America, including the Port of Duluth-Superior. The bill is also endorsed by more than 100 organizations including the Association of Port Authorities, the Agriculture Transportation Coalition (AgTC), the National Retail Federation, the American Trucking Association, the Minnesota Soybean Growers Association, and the Minnesota Corn Growers Association.
In addition to Klobuchar and Thune, the legislation is cosponsored by Senators Tammy Baldwin (D-WI), John Hoeven (R-ND), Debbie Stabenow (D-MI), Roger Marshall (R-KS), Gary Peters (D-MI), Jerry Moran (R-KS), Richard Blumenthal (D-CT), Todd Young (R-IN), Mark Kelly (D-AZ), Mike Crapo (R-ID), Tina Smith (D-MN), Marsha Blackburn (R-TN), Cory Booker (D-NJ), Joni Ernst (R-IA), Catherine Cortez-Masto (D-NV), Mike Braun (R-IN), Raphael Warnock (D-GA), James Risch (R-ID), Michael Bennet (D-CO), Kevin Cramer (R-ND), Ron Wyden (D-OR), Roy Blunt (R-MO), Chris Van Hollen (D-MD), John Boozman (R-AR), Deb Fischer (R-NE), Alex Padilla (D-CA), and John Hickenlooper (D-CO).
The Ocean Shipping Reform Act will:
- Require ocean carriers to certify that late fees —known in maritime parlance as “detention and demurrage” charges—comply with federal regulations or face penalties;
- Shift burden of proof regarding the reasonableness of “detention or demurrage” charges from the invoiced party to the ocean carrier;
- Prohibit ocean carriers from unreasonably declining shipping opportunities for U.S. exports, as determined by the FMC in new required rulemaking;
- Require ocean common carriers to report to the FMC each calendar quarter on total import/export tonnage and 20-foot equivalent units (loaded/empty) per vessel that makes port in the United States;
- Authorize the FMC to self-initiate investigations of ocean common carrier’s business practices and apply enforcement measures, as appropriate; and
- Establish new authority for the FMC to register shipping exchanges
I thank the senator from Washington for her incredible leadership of the Commerce Committee and focusing on issues that matter to businesses. Something that the presiding officer as the former Governor of Colorado and someone who knows a little bit about business understands as well.
We have to fix these supply chain issues and we have to actually take up the torch. We've gotten through the worst of this pandemic. We see the lighthouse on the horizon and it is time to move forward with our economy. And instead of just diagnosing the problem, we actually have to do something to fix it.
And on that list for my own state I would say number one is workforce and getting people into the jobs that we have available. Number two, something that Senator Cantwell has made so clear is semiconductors and all of the things that we should be making in America. Number three is infrastructure. We're so proud of the Bipartisan Infrastructure Bill that we worked so hard on, and the money going to improve our ports, including the port in Duluth, the busiest port on Lake Superior.
And then, finally, something I'm going to address today, the Ocean Shipping Reform Act, a bipartisan bill that I lead with Senator Thune, unanimously passed the Commerce Committee yesterday and I want to thank Senators Cantwell and Wicker for their help on the bill.
Senator Thune and I are both in the middle of the country, in fact we’re neighbors in Minnesota and South Dakota, and we know that American farmers feed the world and consumers and businesses look to them for in-demand ag goods from soybeans to corn to pork to beef, to name just a few. We also have tons of small and big manufacturers in the middle of the country. And it's not just Minnesota or Colorado or South Dakota that's been seeing the delays in shipping. It's everywhere in this nation.
The past two years have highlighted significant supply chain disruptions and vulnerabilities for U.S. exporters, including many families across my home state. U.S. companies have only been able to ship 60% of their orders because they can't access shipping containers during certain parts of this pandemic.
At the same time, ocean carriers, almost all foreign-owned, Mr. President, have reported record profits. It’s estimated that the mostly foreign container shipping industry made a record of $190 billion in profits in 2021, a seven-fold increase from the previous year. This is not the result of improved performance, given how many things we have not been able to ship out. They are fleecing consumers and exporters because they know they can get away with it and this is all while consumers are paying the price literally for the supply chain disruptions caused by their unreliable service. We need to get exports to those who need them, we need to be a country that makes stuff, invents things, exports to the world.
That's why Senator Thune and I put together the Ocean Shipping Reform Act. We also want to thank our colleagues in the House who have a very similar bill. Our bill protects American farmers and manufacturers by making it easier for them to ship ready to export goods waiting at our ports. It levels the playing field for American exporters by updating federal regulations for the global shipping industry.
It gives the Federal Maritime Commission greater authority to regulate harmful practices by big international ocean carriers. It directs the Federal Maritime Commission to issue a rule prohibiting international ocean carriers from unreasonably declining shipping opportunities for American companies. Believe it or not, they bring in stuff from other countries, and what do they export back? Air. Air. So many empty containers with nothing in them. This would fix that.
In addition to giving the FMC more authority to investigate bad practices, the bill also directs the FMC to set new rules for what the international carrier companies can reasonably charge and require ocean carriers to certify and ultimately prove that the fees they charge are fair as rates continue to climb, this is more urgent than ever.
The sheer act of passing this bill will send a major message to the foreign-owned ocean shipping industry that it is time to ship our goods out of America and to charge our American manufacturers and our American farmers and thus our consumers a fair rate.
I want to again thank Chairman Cantwell and Ranking Member Wicker for holding a compelling hearing on this bill. And all members of the Commerce Committee for passing this through and Senator Thune and I have a bipartisan group of 27 co-sponsors: Baldwin, Hoeven, Stabenow, Marshall, Peters, Moran, Blumenthal, Young, Kelly, Crapo, Tina Smith, Marsha Blackburn, Cory Booker, Joni Ernst, Cortez Masto, Braun, Warnock, Risch, Bennet, Cramer, Wyden, Blunt, Van Hollen, Boozman, Fischer, Padilla and yes, the presiding officer, Senator Hickenlooper.