Check Call: The rise of cross-border struggles – and the response

The Future of Freight Festival in Chattanooga, Tennessee, is the event of the fall. Subscribers to Check Call have a special discount code for F3 registration. This is going to be one of the best deals on F3 tickets. Use the code CheckCallF324 or go to this link, and the discount will be applied. There is no better party than a Chattanooga party. This is not one to miss.

Cross border continues to the theme of 2024, with nearshoring on the rise and Mexico continuing to top the U.S. trading partner charts. The only downside is that the technology and efficiency have to catch up to the land formerly known for being a freight black hole.

Enter the cross-border event of the year. Reliance Partners hosted its 7th annual Modernization of Cross Border Trade event in Laredo, Texas. The event covered all things cross-border freight as well as Mexico’s Carta Porte supplement that went into effect earlier this year.

Matt Silver, co-founder and CEO of Cargado, said: “If you want to be able to actually scale your cross-border business, I think you need an operations leader that actually understands all the stuff going on at the border, can speak fluent Spanish, knows how to work with customs brokers, knows how the transfer process works, all that stuff. Then you need somebody at the border. You need a presence in Laredo.”

One of the biggest hiccups of the year is the Carta Porte Complement (CCP). It’s a digital tax document issued to shipments that’s aimed at protecting the transfer of legitimate goods across Mexico. The CCP is a collection of 120 data elements that has shipper information, consignee information for the cargo and its value, and carrier equipment.

Introduced in 2021, the CCP went into effect in April of this year, and with it came headaches. Each shipment must have the proper paperwork or face fines, sanctions and potentially loss of the goods.

Noi Mahoney’s article for FreightWaves notes: “Jose Minarro, managing director for 3PL Sunset Transportation’s operation in Laredo, said the CCP is adding more time and cost to the movement of cross-border shipments. ‘I know a carrier that had to hire at least six people to do the Carta Porte paperwork, because that has to be done real time for the first and second shift. To support his 35 trucks, he had to go and get more admin people to file the Carta Porte for the two shifts. That’s a tremendous impact to their business, and their rates stay the same. How can you survive that?’”

A lot of growing pains are coming with the increase in cross-border trade. The bright side is that everyone seems invested in developing solutions to make trade with Mexico as automated and smooth as trade between the U.S. and Canada.

TRAC Tuesday. This week’s TRAC lane goes from the home of the Gateway Arch, St. Louis, to the hub of the Southeast, Atlanta. Spot rates for this lane are coming down from levels not previously seen since May of this year. St. Louis has seen outbound tender rejections drop 103 basis points to 6.84%. Atlanta also has rejections on the decline. The week-over-week drop is 37 basis points for an OTRI of 4.66%.

Outbound tender volumes are on the rise in Atlanta, and should rejections rise, that will bring the spot rate up. As of right now, an all-in spot rate of $1,358 before margins should secure the load with ease.

Who’s with whom? The Federal Motor Carrier Safety Administration is asking for help with its five-year review of guidance documents. A congressional mandate signed into law in 2015 requires that FMCSA conduct a review of its guidance at least every five years to ensure the documents are clear and that the guidance is consistently enforced and still necessary.

The FMCSA invites the public to give input on existing guidance and areas that are no longer relevant or that need to be updated. The FMCSA has about 1,300 documents in the guidance portal for review. The 30-day comment period will end Sept. 12. Now is the time to give the FMCSA some food for thought about areas that can be improved on over the next five years.