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What gets in the way of supply chain visibility

In the global logistics environment, everyone is talking about supply chain visibility and control. Supply chain visibility simply means having the right information, when you need it, so you can act on it. Getting this information is a challenge, or near on impossible when you don’t have the right systems to support you.

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Specialist airfreight: One retailer’s experience

Speed to Market has become so important that the cost to deliver has become a secondary consideration in supply chain logistics and specialist airfreight is now a critical component to delivering Fast Fashion.  However, if you don’t have a partner with super-sized red tape scissors to help you cut through the complexities of Air, then you could be putting you behind your competition.

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New packing declarations for bamboo – 1 July 2018

The Australian Department of Agriculture and Water Resources has again changed the format of packing declarations as a result of bamboo being classified as an acceptable packaging material. Bamboo packaging is now acceptable provided it is treated by an approved method prior to export or on arrival and does not need to be declared as unacceptable packaging.

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GST on low value goods imported into Australia

From 1 July 2018, GST will be payable on low value goods (AUD1,000 and under) supplied by overseas retailers to Australian consumers.  Under these changes, the Government will use the vendor collection model for collecting goods and services tax, where vendors (including online stores) will collect the GST on low value imported goods at the time of

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Illegal Logging – Back on the Agenda

We wrote in August 2015 advising of the Department of Agriculture and Water Resources’ intention to renew its emphasis on ensuring that importers of timber and timber products complied with the Illegal Logging Act 2012 and the Illegal Logging Prohibition Regulation 2012, by instituting a system of audits.

These regulations aim to reduce the impact of illegal logging on the environment by requiring due diligence in order to reduce the theft, laundering and trade of

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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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CHAFTA DUTY RATES TO COME DOWN IN 2017

The nature of retailing is continually changing.  If it’s not the recent growth of online retail and rapidly changing consumer preferences that is keeping you on your toes; then it will be the need to stay on top of distribution chain productivity improvements to remain competitive that’s keeping you up at night.

Although the cost structure of retail goods has been broadly stable over the last 10 or so years, this is in spite of an upward trend in the prices of inputs to the retail supply chain; in particular, those involved in distributing goods.  With roughly half the cost of getting goods from factory to the consumer attributable to distribution, any relief on this front is good news.

The good news – ChAFTA duty rates to come down

As of 1 January 2017, there will be a change in duty rates for most tariff categories covered under the ChAFTA agreement.

For simplicity, we have summarised the tariff classifications as follows:

chafta duty rates

To take advantage of the new reduced tariffs on your imported cargo you will need to lodge entry after 1 January next year.

With this in mind, now might be a good time be thinking about the cost of goods sold in your upcoming shipments and your available options.  Moving your goods into bond until after the New Year might be worth your while.

When the time is right, talk to us to find out if it is the right solution for you.

Magellan Logistics has been navigating global supply chains for Australian fashion, footwear, textiles and retail businesses for 20 years.

We have your back on this and any other customs or freight-forwarding topic.  If you would like to discuss the ChAFTA duty rates reduction and how you can take early advantage of them with me further please get in touch on 1300 651 888 or via alex@maglog.com.au.

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BE CERTAIN YOUR CARGO IS ASBESTOS FREE

Asbestos declarations may not seem like an urgent concern to those of you who don’t import building or industrial materials.  Nevertheless, we urge you to spare a couple of minutes and read on.  ABF’s recent changes to ensuring asbestos free cargo have already affected importers of textiles, fashion and other retail products. Much to their surprise!

The incidence of community protection questions by Australian Border Force regarding goods containing asbestos has increased significantly. This is due to a recent, high profile and serious breach and in response to a review of procedure.

Under a stricter application of existing regulations, customs brokers will be required to confirm there is no asbestos content in any import declaration line.  To do this they must have confirmation from the cargo owner that the owner is certain that the goods are free of any asbestos.

ABF advised that before importing goods into Australia, importers should ensure their supply chain security by confirming with their overseas suppliers that their manufactured goods do not contain asbestos.

Due Diligence

Importers are encouraged to investigate, and where appropriate implement:

  • contractual obligations with their suppliers that specify nil asbestos content;
  • sampling and testing for asbestos content prior to shipping the goods to Australia; and
  • regular risk assessment and quality assurance processes.

Certification

While there is presently no requirement to provide evidence of certification to gain clearance, ABF has confirmed that in order for owners to be certain their goods are asbestos free they must have acceptable certification. The ABF will only accept certification from NATA approved testing bodies or equivalent authorities as satisfactory evidence of asbestos free certainty.

If undertaking testing outside Australia, certification must be provided by a NATA accredited testing laboratory or a recognised equivalent authority.  International bodies that NATA has a Mutual Recognition Agreement (MRA) with are:

  • Asia Pacific Laboratory Accreditation Cooperation (APLAC) MRA, a regional arrangement with participation by upwards of 20 economies including all of Australia’s major trading partners in the Asia Pacific region. aplac.org
  • International Laboratory Accreditation Cooperation (ILAC) MRA, a global arrangement covering all regions. ilac.org

Both organisations provide a list of accreditation bodies and their MRA status on their websites.

Delays and Penalties

You should also note that for any cargo inspected or redlined by ABF the owner will be required to provide evidence of certification.  In the absence of certification, the owner could be required to arrange sampling, testing and certification.  The importer of any goods into Australia found to contain unauthorised asbestos may be liable to penalties or prosecution.

We are currently experiencing delays in processing Redline documents due to the increase in profiling of commodities for asbestos.

You can read the Asbestos Importation Review by KGH Border Services here.  And download the hotly anticipated Border Force factsheet here.

We understand that navigating the complexities and regulations of customs clearance can at times seem a little overwhelming and frustrating.  But we also know that gaining clearance in a timely and cost effective manner is critical to your business success.

Magellan Logistics has your back on this and any other customs or freight forwarding topic.  If you would like to discuss the asbestos matter with me further please get in touch on 1300 651 888 or via alex@maglog.com.au.

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G20 China dates announced – implications for Australian importers

Following the release of the summit dates the G20 control measures have also been announced for 2016.  This year’s summit will be held in Hangzhou on the 4th and 5th of September.  Hangzhou is within 2 hours drive of Ningbo and Shanghai ports. Based on previous experiences such as the 2014 APEC, 2010 Asian Games and 2008 Olympics, we expect similar control measures to be introduced which will have a significant impact on the export and import cargo flows, causing fluctuations before and during the event.

These controls will be implemented both by the National and Local Governments. We have been able to confirm the following, but we believe further restrictions are still to be announced and we also expect there will be a degree of “unannounced” restrictions that only become evident in the immediate lead up to the summit.

We strongly urge you to discuss these restrictions with your China suppliers to identify any impact it may have with the supply of product to your business during this time. Our suggestion is that wherever possible you take advantage of shipping early, well before any impact of restrictions, and definitely before the dates indicated below.

The following G20 control measures affecting production and traffic to meet air quality and security requirements have been announced:

Shanghai: 24th August – 6th September

  • Jinshan Zone will shut-down all chemical and associated factories
  • Chemical Zone and Fengxian Zone will identify factories that either need to control production or close-down
  • Shanghai Port will have the available port power reduced by 30%, Jinshan Port will have the port power reduced by 50%
  • All factories in the region will need to meet specific operating and pollution standards, those that do not meet the standards will be shut down
  • High polluting motor vehicles from Shanghai will not be allowed to enter Hangzhou
  • The main production and traffic restrictions will generally only be applied to the southern part of Shanghai, this will mitigate some of the effects of exports moving through Shanghai Port.

Ningbo Hangzhou Bay New Zone: 24th August – 6th September

Factories in Ningbo Hangzhou Bay New Zone will either be shut down, or forced to reduce productivity by 50%.

Shaoxing, Zhengjiang: 24th August – 6th September

  • All dye factories will be closed in the two weeks prior to 6th
  • Since March, the Shaoxing Government has been regulating all the high pollution printing factories, so far 64 factories have been shut down, and can only reopen once they meet the required pollution control standards.

Declared Holidays

Public holidays have also been declared from Thurs 1st–Wed 7th September in the below districts.

  • Hangzhou Economic Zone
  • West Lake Scenic Area
  • Shangcheng
  • Xiacheng
  • Jianggan
  • Gongshu
  • Xihu
  • Binjiang
  • Xiaoshan
  • Yuhang

Sun 28th August, Sat 10th Sept and Sun 11th Sept will be working days.

Magellan Logistics is working closely with our Chinese Agents to ensure we have the timeliest information about how this year’s G20 control measures will impact on shipping from China.  Please get in touch with me via lechae@maglog.com.au or your usual Magellan Customer Service Representative on 1300 651 888 or +64 9 974 4817 / 18 for New Zealand based enquiries.

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Become an Australian Trusted Trader

On 1 July 2016 the Australian Trusted Trader Program (ATT) commenced following a successful pilot phase that commenced on the 1st July 2015.

The Australian Trusted Trader is a voluntary program that recognises Australian businesses that meet international supply chain security and trade compliance standards.  The program has been designed and developed in partnership between the Australian Government and industry with the aim to create a fast and seamless trade experience for Trusted Traders.  The ATT is a move towards modernisation of the border environment with the aim of fostering streamlined, reliable, predictable and most importantly secure trade.

By the end of 2020 the program envisages 1000 participants from across all sectors of the supply chain.

What are the benefits of being an Australian Trusted Trader ?

International standing and recognition:  Sixty four countries (including all of Australia’s major trading partners) have some form of trusted trader program with over 40,000 international business participants. A further 16 countries are developing Trusted Trader programs.

Enhancing supply chain security and global competitiveness:  The ATT will contribute to economic growth and prosperity and was included in the Australian Government’s G20 growth strategy.  Through the ATT the Australian Government will develop bilateral Mutual Recognition Arrangements. This will enable participants to access faster clearance times for goods entering our trading partners markets.  Currently the Australian Government is working on Mutual Recognition Arrangements with China, New Zealand, Korea, Canada, the USA, the European Union, Japan and Singapore.

Reduced intervention for legitimate trade:  The introduction of the ATT is a step away from the one size fits all approach to the clearance of goods crossing the border. By removing unnecessary burden to compliant entities and increasing focus on high risk and unknown entities, the ATT will ensure accelerated clearance of low-risk transactions and increased resources allocated to high-risk and unknown entities.

Industry benefits of ATT:  Trusted Traders will be offered a number of benefits which will help foster trade including;

Dedicated Account Manager:  Trusted Traders will receive a dedicated account manager who will be the primary contact between the Trusted Trader and the Australian Border Force.

Priority trade services:  Trusted Traders will have access to advanced rulings for requests on tariff advice, valuations and origin rulings.

Differentiated and prioritised examinations:  Trusted Traders will be recognised as low risk and will be subject to faster border clearance.

Mutual Recognition Agreements:  Trusted Traders will have access to trade facilitation benefits in countries with which Australia has signed a Mutual Recognition Agreement.

Streamlined reporting arrangements (from 2017-2018 financial year):  Alternative clearance arrangements will be available to trusted traders which will reduce the administrative burden on clearing goods.

Duty Deferral (from 2018-2019 financial year):  Duty payments on imported goods will be deferred for a set period from the beginning of 2018-2019 financial year.

What are the costs?

There are no application or ongoing accreditation fees associated with Australian Trusted Trader. However, there might be some business costs associated with meeting the required standards for the program.

How to become part of the ATT?

The ATT program is open to all Australian Businesses that hold an ABN, that are actively involved in the international supply chain and have two or more years of trading and compliance history.

      1. Check that the ATT is right for your business
      2. Complete an expression of interest form
      3. Complete the Self-Assessment Questionnaire (SAQ). Once the expression of interest is complete, an ABF account manager will help you complete an SAQ. The questions in the SAQ explore the business’s international supply chain activities and trade compliance practices
      4. An Australian Border Force officer will visit the business site to undertake a physical validation.

If accepted, the business will be offered a range of benefits designed to enable easier interaction within the international supply chain regulatory environment.

Magellan Logistics is well placed to assist you with gaining ATT acceptance through the provision of expert advice and guidance.  If would like to discuss whether the ATT program is right for your business please get in touch with me on 1300 651 888 or via alex@maglog.com.au.

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