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January 2 2023

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50 Journal of Commerce | J anuar y 2, 2023 EXECUTIVE COMMENTARY ANNUAL REVIEW & OUTLOOK 2023 Maritime operations, truck capacity, and inter- modal equipment providers. While I do not believe we will see the spike in volume that we have seen the past two plus years, which in itself will smooth the flow of goods, a greater focus on distribution capacity, accountability, and most of all the changing labor force will need to be considered to avoid the disrup - tion caused by future non-forecasted peaks in the flow of freight. Inland distribution capacity needs to be available and coordinated with the demand. Container terminals, with their limited ability to expand, can- not be used as storage facilities when the inland distribution networks or forecasts fail. Lessons learned by major mis- calculations of labor availability, caused to a large degree by the changing priorities and options of those in the job market, need to be accepted and integrated into the supply chain. Remote work options, flexible hours, and prioritizing family time, just to name a few, are more important to today's worker confusion," the impact on shipping fluidity would be enormous. Instead of addressing supply chain issues, a final rule that aligns with the NPRM would increase them. Such myopic government heavy-handedness is clearly not the solution — it is the problem. And we all may need to deal with it going forward. New York Shipping Association John Nardi President I hope what we have learned the past two and a half years is that the solu- tions to international supply chain challenges, especially for imported cargo, often lie far outside port operations, vessel Metro Group Maritime Marcus L. Arky CEO What do we make of this unprece - dented period in our indus- try? In a world where mar- kets rise and fall, we have at least been able to rely on freely entered contractual arrange - ments, protected by well- established maritime and contract law. But now we have the Ocean Shipping Reform Act of 2022. Drafted and passed on a set of tem - poral facts, it codifies changes to the Shipping Act based on the most extraordinary circumstances. Our legislators unleashed the US Federal Maritime Commission (FMC) to respond to the recent supply chain snarls and enacted a recipe for chaos. As a notable example, in Octo - ber 2022, the FMC issued a Notice of Proposed Rulemaking (NPRM), proposing that bills for demurrage and detention (D&D) only be sent to those contractually responsible for payment. Nonetheless, if the NPRM becomes final, many par - ties — including motor carriers, customs brokers, and possibly even consignees — that carriers bill today would no longer be deemed "billable parties." The FMC's proposed rule reflects a remarkable disregard of extensive and settled case law on this issue. Courts charged with the interpreta - tion and enforcement of maritime contracts have consistently taken a broad view on privity under ocean bills of lading. For centuries, consignees and other secondary parties across the globe have faced liability for unpaid D&D, even in the absence of a direct contract. If the NPRM becomes a final rule, consignees and others, know - ing they would face no secondary D&D liability, would no longer have any incentive to timely retrieve and return containers. Much more D&D would go unpaid without mean- ingful consequence and, certainly relative to any purported "billing North Carolina Ports Brian Clark Executive Director Continued supply chain disruptions will mean that shippers and transport providers alike will continue to seek reliable, efficient, congestion-free ports. Ports no longer operate in the back - ground of everyday life — supply chain disruptions brought our industry into the mainstream media in an unprece - dented manner. In North Carolina, the attention has given us the opportunity to demonstrate what we do best: finding solutions for our customers and provid - ing unmatched customer service, all while maintaining the highest vessel productivity in North America and fast- est turn times on the East Coast. The cornerstone of our strategic growth plan — the nearly $300 million capital invest- ment program — has allowed us to serve larger, more efficient vessels while maintaining best-in-class vessel productivity, gate turn times, and rail dwell times. Our new container gate and terminal operating system serve to further enhance our reputation as the fastest port on the East Coast. Recent service additions such as the Wilmington Midwest Express expand our reach into the highly sought-after Midwest market and provide a competitive advantage in a time when supply chain issues continue to affect ports across the country. In 2023, it will be imperative for ports to look beyond their fence lines and partner with others on increas - ing efficiency beyond port gates and into the transportation network. We've recently partnered with our local officials as well as the state of North Carolina to support projects to increase distribution access not just on our terminal, but in the state as a whole. Collaboration between all facets of the logistics network will be paramount in 2023 to increasing efficiency. North Carolina will continue to focus its efforts in providing solid, reliable service to shippers. We look forward to a strong 2023. "In 2023, it will be imperative for ports to look beyond their fence lines and partner with others on increasing efficiency beyond port gates and into the transportation network. " ◀ ◀ "Such myopic government heavy- handedness is clearly not the solution — it is the problem." Marcus L. Arky ◀ "The supply chain needs to adapt to the workforce, because the workforce will have other options in other industries." John Nardi

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