FMC COUNSEL WARNS CARRIERS: Federal Maritime Commission General Counsel S.J. Andersen last week warned ocean carriers that they "must comply with all relevant statutory requirements" of the newly minted Ocean Shipping Reform Act of 2022, including those related to detention and demurrage charges. While not a binding ruling by the Commission, the opinion is an aggressive new stance for the historically sleepy agency responsible for regulating ocean shippers and is being hailed by U.S. agricultural exporters. What it means: Andersen said that certain pieces of the new law are "self-executing" and will take effect immediately, and specifically targeted the new rules around detention and demurrage. The section Andersen is referring to also contains language aimed at prohibiting ocean carriers from abandoning ag goods at the docks, but he did not specifically reference that in his opinion. Those provisions are subject to an FMC rulemaking to define what constitutes an "unreasonable refusal to deal or negotiate with respect to vessel space." Big words carry weight: Detention and demurrage charges are a holding fee applied to shippers whose goods are left in containers in the port for longer than an agreed to grace period or shippers who do not return the container in time. While the fees are seen as essential to keep cargo flowing, ag shippers have become outraged over being charged exorbitant fees without good reason – like a ship leaving with empty containers and stranding their goods or backups causing a container to be physically stuck through no fault of the shipper. The new law requires carriers to certify any charges and take responsibility — including potential fines — if the certification proves faulty. Meanwhile, humble pie on food inflation: The administration said the new law would help bring down inflation. But food economists aren't so sure the impact will be detectable anytime soon in grocery bills. Marc Bellemare, an agronomics professor at the University of Minnesota who studies food prices, said he's "skeptical because 75% of the food in the world is consumed in the country where it's produced," and not brought in on ocean ships. Another economist and supply chain expert Erkut Sonmez, a professor at the University of Nebraska, told MA that while it's "not going to have a very short term direct effect on the food prices," it could have a "domino effect or a long-term effect on actually managing supply chains in a more cost efficient way." INFANT FORMULA CRISIS: The Biden administration is still seeking a full picture of ongoing problems with infant formula supply — more than four months after a key plant shutdown sparked shortages and a national crisis, Meredith reports. Details: The FDA awarded a $70,000 contract to the data firm NielsenIQ on June 14 for four months of retail tracking data, according to two people familiar with the discussions and a posted notice of the agreement. The move comes after White House officials privately admitted to POLITICO that incomplete data on retail stocks slowed their response after the shutdown and recall of formula from a key Abbott Nutrition manufacturing plant in mid-February. As a result, the administration didn't anticipate the severity of the shortages, which spiraled into a political liability for Biden in May. Lingering fallout: Despite launching an emergency government response over the last month — including flying in formula from abroad and easing regulatory restrictions — the supply situation is getting worse. Data the White House tracks shows current in-stock rates dipping below those in early May. And the shortages are likely to drag on for months more after the Abbott plant at the center of the crisis was knocked offline again by storms and flooding last week. More details: The FDA's Office of Food Policy and Response, one of the teams responding to the formula shortages, stipulates in the online notice of the contract that Nielsen's retail tracking data will help FDA "monitor and analyze the status of infant formula supply chain impacts and respond to White House requests on the outbreak." What's next: Up until now, administration officials have been piecing together data about infant formula retail stocks from the federal government, formula companies, retailers and private market research firms as they've struggled to respond to the situation. CONGRESSIONAL PAC TO ENDORSE FARMER IN NY-19: The influential Congressional pac Elect Democratic Women will endorse Jamie Cheney in NY-19, a cattle farmer and businesswoman vying for the seat in the heart of New York's agricultural basin, her spokesperson told MA. Cheney repositioned from a State Senate election to a Congressional race after former Rep. Antonio Delgado (D-N.Y.) stepped down to become the Empire State's Lieutenant Governor. The pac has several Ag Committee members on its board including Reps. Cheri Bustos(D-Ill.) and Annie Kuster (D-N.H.). It has also endorsed Committee heavyweights like Reps. Abigail Spanberger (D-Va.) and Angie Craig (D-Minn.). Who is she?: Cheney runs a beef farm in the Hudson valley and is the founder of Prokanga, a talent search firm that helps working parents land more flexible roles. She has made ag a staple of her campaign, calling for policies that "help our farmers and agricultural workers, the producers of our stable, affordable food supply," on her campaign website. State of the race: The race for NY-19 will likely be one of the most competitive in the country and instrumental in determining which party will control Congress after the midterms. Cheney will face Josh Riley in a Democratic primary, who is a native of Endicott in the western half of the district. Riley, a former D.C. attorney and Congressional general counsel, has scored the endorsement of the influential progressive New York Working Families Party, known for endorsing progressives like Rep. Alexandria Ocasio-Cortez (D-N.Y). The likely Republican candidate is Marc Molinaro, the county executive of Dutchess County. He is running in both a special election to replace Delgado and the regular election in November. His Democratic opponent, Ulster County Executive Pat Ryan, will switch to the new 18th district for the election in November. What's next: A clearer picture of the race will emerge after June 30, when the Federal Election Commission closes the books on its July filing deadline. The primary is slated for Aug. 23.
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