2021 Chairman’s Report

James Libby
Finck-Jones-Libby Co.

The spectacle of the M/V Ever Given astride the Suez Canal was perhaps the iconic moment in international trade, but the past year has been a tide of rising frustration with sharply rising freight rates, demurrage costs, and container shortages on the piers. While perhaps just more than a third of the traffic reaching the Port of New York/NJ passes through the Suez Canal, the Federal Maritime Commission had already opened an inquiry into these matters earlier in the month before the blockage occurred. 

AFI was invited to comment, specifically on the particulars of freight rate increases, and whether these were being levied on existing, or new contracts.  AFI solicited comments and input from the members in the email newsletter - just one example of AFI providing crucial input, and a voice for the views and experiences of member importers, that have been badly affected by this shipping crisis over the past year. 

March had opened with the more optimistic news that the Biden Administration had suspended punitive tariffs resulting from the EU/U.S. tariff dispute over the aircraft dispute, but much remains to be seen about the details. Optimism that the pandemic might have softened the sharp contentious atmosphere prevailing in trade talks now appeared unrealistic. 

Olive oil was amongst the products signaled out for retaliatory tariffs in the dispute in the past, but in more favorable news, the AFI’s North American Olive Oil Association has continued to work in the positive direction of creating both a U.S. FDA standard for identity of olive oil, and a Research and Promotion Order, which will lead to greater consumer confidence, and consumption. 

Oversight of this enormous process of tariff settlement is a core mission of AFI, and by the end of March, AFI was promptly reporting the consideration of tariffs to be levied on sundry seafood and other products, based on the United States Trade Representative office determination of violations of digital services taxes, as Section 301 investigations, tempering the once hopeful atmosphere.  Of course, the value of AFI’s service in reporting this briskly is that members are offered a chance to comment and register their objections! 

AFI’s prompt reporting of the USTR actions on imposing tariffs on an ever-changing list of products remains a valuable service. In the past, AFI was successful in securing exemptions in imposed tariffs, by managing to include member’s products in the Miscellaneous Tariff Bill, resulting in substantial, albeit temporary, savings. 

The AFI commitment to free trade, which is imbedded in our mission statement, is a constant effort to protect member’s interest in the constant flux of trade policy, where without it’s voice, individual firms’ concerns would be swallowed up without recourse. AFI remains a resource able to engage these matters on a federal level, which is not possible for individual firms.

While trade remains a dramatic focus for AFI, U.S. FDA regulatory matters are a continuing concern for all. Nearly a decade has passed since FSMA (the Food Safety Modernization Act) has passed, and AFI has led the way in providing education and clarification of U.S. FDA policy during this period. AFI’s president, Bob Bauer, was involved in the creation of the FSMA education course, authorized by FDA, and this remains a valuable resource for regulatory education in FSMA compliance. I strongly recommend the class on the Foreign Supplier Verification Program, which is offered to obtain FDA recognized training on a nearly monthly basis. FDA is moving towards more active enforcement, despite the limits of the pandemic. This program offers vital preparation and is available online, in view of obvious travel restrictions, as a two-day program.

Managing California Proposition 65 has also remained an area of concern for importers, and in light of this, AFI ran an informative webinar, highlighting the current issues, which is still available.  AFI also brought to the attention of the membership a bill introduced in California to curb Prop. 65 abuse (Assembly Bill 693) and has advocated member’s action to rein in predatory legal practices.

While not as dramatic as trade and enforcement, an important part of AFI’s work is a continued review of product standards and specifications.  The AFI maintains task forces reviewing standards in traditional products such as cashews, Brazil nuts, dried apricots and hazelnuts. Contract compliance is enhanced when common standards can be referenced, and this remains a valuable contribution of AFI to the trade. The standards are freely available to members on AFI’s website. 

Nobody who went through the past year of the pandemic can casually review the year without a sense of gratitude for the sustaining support of friends and colleagues. The disciplined professionalism, which characterizes the work of AFI has endured what for many has been a brutal period, without making excuses for performance. I thank you.