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Jan 21, 2019 7:00:00 AM

Freight Forwarding in the midst of a Government Shutdown

It is sometimes easy to forget how dependent that we, as freight forwarders, are on external stakeholders that enable our business. In times like today where we are living through an extended government shutdown, very public tasks like TSA Guards at airports not getting paid dominate the news cycle. While this is certainly a major concern, there are other, less publicized, impacts looming on the horizon. As a freight forwarder, I am specifically thinking of impacts to US imports and exports.

First, since the shutdown went into effect, the Federal Maritime Commission (FMC) has been closed. Relying on automated systems to help the system keep going, basic core functions are still be performed. However, should an issue occur, expect major impacts to our industry.

Second, while customs and border patrol is still considered essential services, the Wall Street Journal’s Erica E. Phillips reports that “Agencies that oversee the flow of goods are starting to cut back services and working hours at some [terminals]… raising concerns that serious delays could spread if the impasse in Washington continues.” This concern has not yet translated into a direct impact on freight forwarders yet (as far as I can tell), but if things continue, then we can expect an impact will occur.

Third, licenses to export goods are either being delayed or not be granted as a result of the shutdown, which impacts logistics supply chains directly. The Wall Street Journal’s Samuel Rubenfeld writes that “Some exporters in the defense and technology sectors can’t obtain required licenses to ship their goods abroad because the agencies that approve those licenses have scaled back staffing.”

Overall, the impacts of the shutdown have not permeated to the freight forwarder yet. That said, if things continue, it is only a matter of time until they will.

Topics: freight forwarding and government shutdown, impacts to freight forwarding, global supply chains, government shutdown

Author: Mario Bruendel

The Xport Guide to Next-Generation International Shipping

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