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UPDATE: NZ Earthquake – impacts on freight movements

NZ EarthquakeCentreport

After Sunday night’s NZ earthquake recovery efforts are underway at CentrePort, Wellington, but the port remains closed to most operations.  Ferry operations from CentrePort resumed on Monday night however, and the Seaview oil terminal reopened yesterday afternoon. Centreport commercial buildings, BNZ and Customs House have withstood the quake with little damage, however two other buildings – Statistics House and Shed 39 – are expected to need extensive damage inspections.

Rail

• KiwiRail said in a statement that the Kaiarahi and Kaitaki ferries sailing between Wellington and Picton would carry freight and vehicle passengers only. Foot traffic has been suspended due to terminal damage. KiwiRail chief executive Peter Reidy has said while there was still an enormous amount of work to do it was critical for the North Island network to be fixed quickly.

Christchurch

• Further south at Lyttelton Port of Christchurch, key infrastructure has been inspected and both bulk and container services, as well as railway links, are back to normal.

Nelson

• Port Nelson incurred no serious damage and open for business as usual.
Meanwhile bad weather has become a factor with heavy rain leading to extensive flooding in some areas. New Zealand Police have warned motorists to delay driving home from work as traffic out of Wellington is gridlocked and key roads are blocked in places.  New Zealand Shippers Council chairperson Mike Knowles said there were disruptions to the supply chain connecting the North and South Islands but government and agencies were doing their utmost to restore routes. “It tends to be the importers that will be greatly affected with a major barrier in place (no road or NZ earthquakerail) to get their goods to the lower South Island via land.”

Magellan Logistics has been navigating global supply chains for Australian businesses for almost 20 years. We have your back on this and any other customs or freight-forwarding topic.  If you would like to discuss your shipping which may be impacted by these events, please get in touch on 1300 651 888 or via steve@maglog.com.au.

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Merry Christmas

We’d like to take this opportunity to offer our sincere thanks to all our clients, partners and agents for yet another wonderful year.  We wish you a Merry Christmas and Happy New Year in 2016 and look forward to working with you again in 2016.

Please note our altered operating hours over the Christmas and New Year period.

Magellan will be closed for the Christmas/New Year Holidays as follows:

  • Close 2pm Thursday 24/12/15, reopen 8:30am Tuesday 29/12/15.
  • Close 2pm Thursday 31/12/15, reopen 8:30am Monday 4/1/16.

We are open as usual on all other days.

Should you need clarification, or options for freight movement around this holiday period, please contact our Customer Service team on 1300 651 888.

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ChAFTA Update – latest news

After much speculation, we have received confirmation originating from the office of The Hon Andrew Robb AO MP – Minister for Trade and Investment, that final notes were being exchanged yesterday (9 December 2015) and ChAFTA is set to enter into force on 20 December 2015.

A couple of key points to note include:

Certificates of Origin

The following Chinese Authorities will be the only powers able to issue Certificates of Origin [COO]:

– AQSIQ (General Administration of Quality Supervision, Inspection and Quarantine)

– CCPIT (China Council for the Promotion of International Trade: (China Council for the Promotion of International Trade).

Please note: COOs will not be issued prior to the commencement date of CHAFTA.

Duty free or 5%?

For further information regarding the change in duty rates and confirmation of whether your duty rates will or will not change on this date please feel free to call on 1300 651 888 or email me daniel@maglog.com.au

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Fun and Innovative Uses for Retired Shipping Containers

While we take the import and export of our clients’ goods seriously, we’re not all business here at Magellan Logistics. In fact, we’re fascinated with the myriad fun and innovative ways to repurpose all those retired steel shipping containers that we once had a hand in shipping around the globe. We’re super impressed when someone creates something new and functional out of just one container.

Texas architect Jim Poteet helped Stacey Hill, who lives in a San Antonio artists’ community, wrangle an empty steel shipping container into a playhouse, a garden retreat, and a guesthouse for visiting artists.

Texas architect Jim Poteet helped Stacey Hill, who lives in a San Antonio artists’ community, wrangle an empty steel shipping container into a playhouse, a garden retreat, and a guesthouse for visiting artists.

But there are a number of great ways to reuse one or several of these containers. One of the most common is to use retired containers as the skeleton of a residential building, and it’s a great way to recycle these containers for additional use. Many families might even use a single shipping container as the shell for a lovely holiday home somewhere, as it’s a far sight less expensive than having a fully-featured residence built to spec. Of course, old shipping containers aren’t just ideal for single-family homes either; the world’s first shipping container hotel, located in London, is proof positive that you don’t need to limit your imagination to small structures.

Bedding down for the night in an old shipping container not your speed? There are plenty of other uses for a retired shipping container. The size and shape of these containers make ideal swimming pools, for instance.shipping container architecture  Additionally, if you prefer to stay dry, you can take a smaller intermodal shipping container and modify it into a studio or workshop. A collection of larger containers can be used to put together bigger buildings as well as to build storefronts, fitness centres, or even entire shopping malls.

Boxpark Shoreditch - London's first pop-up shopping mall made completely from shipping containers.

Boxpark Shoreditch – London’s first pop-up shopping mall made completely from shipping containers.

There’s also a growing movement to repurpose shipping containers in order to provide cheap and easy infrastructure for developing countries. From portable restrooms that are more permanent than chemical toilets, self-contained powered classrooms created by fitting the roof of a shipping container with solar panels, compact gardens or nurseries complete with hydroponic growing racks, or miniature emergency medical centres fitted out in ways similar to an oversized ambulance, there’s all sorts of ways to turn a retired shipping container into something that can make a real difference.

infrastructure container

Including one impressive gravity defying art installation!

Installation called WOW Westminster by Brazilian artist José Resende. Part of the Vancouver Biennale.

Installation called WOW Westminster by Brazilian artist José Resende. Part of the Vancouver Biennale.

 

 

 

Here at Magellan, we love everything to do with shipping your cargo all over the world, and that includes what to do with shipping containers that have outlived their primary usefulness. If you’re interested in learning more about what Magellan can do for you and your import and export needs, contact us today and we’ll be happy to show you the Magellan difference.

 

Sources:

http://webecoist.momtastic.com/2009/04/05/15-awesome-ways-to-reuse-shipping-containers/

http://www.marineinsight.com/marine/environment/top-26-innovative-uses-of-shipping-containers/

http://news.bbc.co.uk/2/hi/uk_news/england/london/7176594.stm

http://inhabitat.com/boxpark-londons-first-pop-up-shipping-container-mall-opens-in-shoreditch/

http://blogs.vancouversun.com/2015/11/23/used-shipping-containers-turned-into-art-in-new-westminster/

http://www.dwell.com/great-idea/article/what-you-can-accomplish-single-shipping-container#1

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ChAFTA Update

Now that the Federal Opposition Leader Bill Shorten says he has reached a compromise with the Government and will now support the Chinese Free Trade Agreement it is worth going over a few of the key points as we see them.

A COUPLE OF KEY POINTS AS WE SEE THEM:

Hong Kong is not part of China  Hong Kong is classified as a different customs territory to mainland China and is a Freeport.  For the purpose of ChAFTA goods shipped via Hong Kong will not retain their status as Chinese originating goods unless the goods remain under customs control at all times (this was also the case for the China-NZ FTA).

The implications of this are profound for the many organisations that operate distribution centres and warehouses (that are not bonded warehouses) in Hong Kong as the goods entering Hong Kong will lose their China Preferential status.

Phasing of Duty  At present for items originating in China that have a duty rates of 5%.  It should not be assumed that from implementation of the FTA the duty rate will simply drop to 0%.  Although it is the aim to reduce all items to 0%, this will be phased in for some items over a period of some years (up to 5 years in some circumstances).  Clothing is one of these items where under the first year of the CHAFTA operation the duty rate will not be changed at all.

WHAT YOU CAN DO:

Whilst the agreement has been signed and now has bipartisan support in the Parliament, there is still a lot of detail to be finalised in order to provide greater certainty to industry. This process has already taken some time and is expected take a couple more months before implementation (we are expecting Dec 2015 or early 2016).  If you have any questions about how the ChAFTA will impact your imports please get in touch with Magellan 1300 651 888 or by email.

 

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Tariff Concession Orders (TCOs) – a new approach

On 7 October 2015 the Australia Border Force (previously Australian Customs) released an exposure draft on the Interpretation of Tariff Concession Orders (TCOs).

It is the confirmed opinion of at least one recognised Australian barrier compliance lawyer that the draft is a significant departure from the methodology used to interpret TCOs for the past 40 years or more.

Essentially, an importer who takes advantage of any TCOs without having a Tariff Advice in place (which confirms whether the ABF agrees that a particular TCO refers to particular imported goods), runs the risk of incurring demands for the duty which would have been payable if a TCO had not been quoted on import declarations. The ABF can review for the past 4 years.

This period may be extended beyond 4 years if the TCO had been quoted to intentionally avoid the payment of duty and additional GST.

As a Freight Forwarder and Customs Brokerage, we are not in a position to predict the decision making processes of the Australia Border Force or consequences of their decisions. Therefore the onus for compliance on Declarations falls to the importer under the self-assessment regime which is currently in place.

We recommend that you review any Tariff Concessions that you currently use for your cargo.   Please do not hesitate to contact me via email or 1300 652 818 if you would like to discuss your options as you consider whether or not instruct Magellan to apply for Tariff Advices for goods you import using TCOs.

It is also important to note that while applications for Tariff Advices are not particularly time consuming, delays of up to 6 weeks can be experienced due to the ABF approval process.   This may delay the Customs Clearance process in turn.

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Exports – not as easy as imports in reverse

Over the last 19 years Magellan has built its reputation on handling large volumes of import cargo into Australia for our customers across a variety of industries, but especially fashion, textiles and other retail. What you may not be aware of is that exports is also central to our offer (and growing). Our exports team has considerable experience in Australia’s core export markets, including commodities and agriculture.

Whether it’s 2 small parcels, or 20 containers of cargo to be shipped, Magellan can advise on the most cost effective solution, as well as the benefits and drawbacks of different shipping methods.

Magellan currently exports cargo via courier and consolidated airfreight, as well as less than (LCLs) and full container loads (FCLs), on a regular basis, to destinations including UK, USA, Asia, and New Zealand. In fact, through our strategic alliances with overseas agents, we can service the vast majority of major cities worldwide.

If you are shipping to New Zealand, our Auckland office provides the opportunity for Magellan to directly monitor the door to door movement of your product. If your cargo is bound for another destination outside of Australasia, Magellan will work with our network of trusted agents to ensure your cargo is handled with the utmost care, avoids all non-mandatory delays, and meets the requirements of all local authorities at destination.

We can also guide you through the various documentation needed to ensure the export process runs smoothly. To start with our easy to use Shipping Letter of Instruction (SLI) can be downloaded from the resources section of the Magellan website (under Shipping and Customs forms).

Some countries are easier to trade with than others. For example, USA has strict pre-reporting requirements known as ISF / AMS filing. Magellan can guide you through this process to ensure minimal impact on your business, as well as advise what will be required to satisfy other government departments e.g. Food and Drug Administration (FDA).

The Magellan export specialists are waiting for your call, and looking forward to assisting you with your export shipments. Get it touch with us via www.magellanlogistics.com.au or 1300 651 888.

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Professional Development at Magellan

Congratulations to Daniel Crawford – Magellan’s Customs Manager on his successful completion of the LMA High Performance Management Diploma.

An intense 44 weeks of classes, 9 modules that covered personal and team performance, creating high performance environments, management and leadership, change and communication and 2 practical projects has left Daniel feeling inspired and motivated (if a little weary) just in time for peak shipping season. Well done Daniel!
Professional development is a key focus at Magellan. From our perspective, the course has delivered enhanced skills in time management, delegation, organisation and focus on high payoff activities, and general well rounding of management skills. Already we are seeing the pay-off with Daniel’s leadership on the integration of the new Transaction business and internal IT projects.

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TRANS PACIFIC PARTNERSHIP – IN A NUTSHELL

This week negotiators in the US announced, after eight years of negotiations, an historic agreement had been reached as to the terms of the Trans Pacific Partnership.

WHAT IS IT?

The TPP is a web of agreements between the involved countries designed to boost trade and economic growth.  It spans everything from jeans to lobsters to intellectual property.The TPP is designed to create major changes in the economies of the 12 signatories and will be the world’s largest FTA covering 40% of global GDP.

WHO IS INVOLVED?

The final agreement was signed by Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore, United States and Vietnam. The countries involved make up 40 per cent of the world economy.

The agreement began as almost casual negotiations between New Zealand, Brunei, Singapore and Chile but rapidly expanded.

While one of the Australia’s largest trading partners, China, is not involved in the deal, several other countries have indicated they are hoping to be covered in the new system of trade rules.  These include South Korea, the Philippines, Taiwan and Colombia.

KEY OUTCOMES

The TPP addresses a variety of trade topics including trade in goods, services, investment, Government procurement, intellectual property, environmental laws, labour laws and intellectual property.  The details of the trade outcomes are yet to be released.  However, the following is significant for Australian trade:

  • This will be Australia’s first significant FTA with Canada, Mexico and Peru (but this only represents less than 2% of Australia’s trade).
  • Agricultural access to the US and Japan is likely to be improved beyond our existing FTAs.
  • Country-of-Origin labelling will be based on TPP regional content. As such, goods can include content from multiple TPP partners and still qualify for preferential treatment.  This could be important for goods of US or Japanese origin that undergo some further process (such as repacking) in Singapore or Malaysia.  Certificate of origin details are yet to be released.  However, it is unlikely formal certificates of origin will be required.  Both the US and NZ do not traditionally require such documents and other TPP countries have shown a preference for self-certification.
  • The TPP is drafted in a way to allow inclusion of other countries in the future. It is not unrealistic to foresee a future where the TPP will be the primary trade agreement governing Asia Pacific trade.
  • In recent presentations, DFAT suggested that change in tariff classification will be the primary rule of origin for goods that are not wholly originating. It also includes timelines to cut tariffs and financial levies on all goods, but it is unlikely to include the complete abolition of many tariffs.
  • The TPP also provides for a range of agreements to make cross-border investing easier and therefore more frequent by reducing regulatory hurdles.
  • The agreement includes commitments to help small- and medium-sized businesses understand the agreement, take advantage of its opportunities, and bring their unique challenges to the attention of the TPP governments.
  • A chapter entitled “Trade Remedies” includes a series of agreements designed to clarify key details in exporting and importing a wide range of products.

 

NEXT STEPS

Usually it takes 9-12 months from the conclusion of negotiations to the implementation of an FTA.  However, each country will need to pass and ratify associated legislation for the partnership to begin.  Given this includes the US parliamentary process in an election year; we expect 2017 is a more realistic commencement date.

With the implementation time-frame uncertain and few details on specific outcome, the best advice is for parties to stay informed and keep the TPP in mind when making long term strategic trade decisions.

If you have any questions you need any further information, please do not hesitate to contact Magellan on 1300 651 888 or via email info@maglog.com.au

Read the Prime Minister’s media release here

Sources: Hunt & Hunt , SMH.com.au

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Trusted Trader Program – UPDATE for importers

The Australian Trusted Trader Program is a voluntary partnership between an accredited businesses and the Australian Government that aims to streamline and facilitate trade, and enhance supply chain security.

The Department of Immigration and Border Protection (DIBP) recently launched the programme announcing the initial four pilot participants and is now extending invitations to other exporters and importers to participate in the pilot phase.

The following is as an independent observation provided by the Freight & Trade Alliance (FTA) outlining the current status of the programme and key things businesses should consider when weighing up whether to participate.

BENEFITS

Importers are likely to benefit from participation with priority trade services (including the possible relaxation of document requirements under FTAs), access to a relationship manager and increased predictability of cargo release which will assist in the management of logistics operations.

Other benefits are likely to include duty deferral and streamlined reporting processes, including reforms to align cargo reporting requirements with contemporary multiple supplier (assembly order) commercial practices.

In parallel, industry is also looking for a reduction in the DIBP administered Import Processing Charge (IPC) that is currently charged on a consignment basis.  Note – effective 1 January 2016 the IPC will increase to $50 for consignments valued between $1,000 and $10,000 and to $152 for consignments of greater than $10,000.

Further information on duty deferral and streamlined reporting for Trusted Traders will be subject to Government consideration as part of the 2016 / 2017 federal budget process.

Exporters are expected to benefit from streamlined processes via Mutual Recognition Agreements (MRAs) being established between governments that support global trusted trader programmes.

It is also anticipated that joining the programme will satisfy international airfreight “security” requirements and will be aligned to the Office of Transport Security’s “known consignor” scheme.

COSTS

DIBP will not charge for the application process or ongoing client management support associated with the programme.

However, businesses will need to demonstrate requirements relating to supply chain security and a history of trade compliance.  It is anticipated that costs will vary depending on existing audit measures in place and remedial action required for qualification against the DIBP standards.

NEXT STEPS

Until there is a clearer understanding of the programme’s benefits and costs, it’s difficult to determine a definitive return on investment.

In the interim and as an indication of requirements, an Australian Trusted Trader self-assessment questionnaire that forms a part of the application process is available from ComLaw.  It is important to note that not all questions will be applicable to all applicants.

We recommend that exporters and importers continue to work closely with their freight forwarders and customs brokers as their trusted advisors to ensure ongoing high levels of compliance with trade measures and to document supply chain processes.  In an environment of increased compliance activity, this approach will reduce exposure to significant penalties and will best position businesses to take advantage of the Australian Trusted Trader programme once benefits are clearly established.

Magellan Logistics is well placed to assist.  Should you need any further information, please do not hesitate to contact Daniel Crawford, our National Customs Manager on 1300 651 888 or via email daniel@maglog.com.au.

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