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FROM PG1 been a factor in overall shipping costs ever since.
information from fuel stations throughout the United States and creates a national average. T H E B O T T OM L I N E Fuel surcharges are a valuable tool for carriers to protect themselves against fuel price increases over the life of a contract. At the same time, they’re also a factor that can greatly impact overall shipping costs. Knowing how they work is essential in fully understanding your cost of operations. P to P
These methods replace the 15% flat fee set up by the Department of Energy in the ‘70s. That flat fee was based on the total linehaul charge and caused massive overpaying by shippers of high-value goods. It was later abandoned. Today, these are often based on an average mile per gallon and the national average price of diesel. Many carriers determine their fuel surcharge according to the National Average Diesel Fuel Index, published weekly by the Energy Information Administration. This index collects retail pricing
H OW A R E T H E Y D E T E RM I N E D ?
Each carrier has its own
formula for calculating surcharges. They’re normally added to the total freight charge on either a per-mile or percentage basis.
SHIPPING FREIGHT FROMTHE U.S. TOCANADA The United States and Canada share the longest international border (at 5,525 miles) and the strongest bilateral trade relationship (with nearly $2 billion exchanged every day) of any two countries in the world. In fact, the U.S. is by far the dominant point of origin for goods imported into Canada, with China a distant second.
At its core, the USMCA seeks to restructure protections and build incentives – making production in North America more profitable and efficient. To that end, it provides several streamlining benefits over NAFTA – among them a single-window process, which allows the use of one dataset to ship goods across borders of all three countries. Per the Office of the United States Trade Representative, the USMCA is a “mutually beneficial win for North American workers, farmers, ranchers, and businesses.” C U S T OMS C L E A R A N C E Whether utilizing less-than-truckload, truckload, or flatbed, shipping from the U.S. to Canada requires a few extra steps compared with shipping domestically within the “Lower 48.” All commercial shippers seeking to import goods into Canada must observe customs regulations. This includes the mandatory use of a customs broker. A customs broker is responsible for clearing goods into another country while navigating customs protocols. While many businesses that frequently ship to Canada have existing broker relationships in place, Averitt streamlines the process even further with an expert team of in-house customs brokers. Both a Bill of Lading (BOL) and Canadian Commercial Invoice (CCI) are also required. The CCI tells customs your shipment details and outlines the responsible parties. Your customs broker will review the BOL and CCI before shipping to ensure all relevant information is accounted for. In addition to other standard considerations, like a packing list and proper payment documentation (such as a letter of credit), you’ll also need a
Certificate of Origin when shipping into Canada. This certificate is used for the primary purpose of helping the U.S., Canada, and Mexico determine whether goods entering their respective countries qualify for preferential tariff treatment. While a familiar fixture under NAFTA, the Certificate of Origin has also seen changes under the USMCA. All three countries were required to use a uniform document in the past. Under the USMCA, there is no must-have format. If the proper data points are addressed, the requirement is fulfilled. Also, under NAFTA, the importer wasn’t allowed to fill out this document. Under the USMCA, the producer, exporter or importer can complete the certificate. This is certainly not an exhaustive list of Canadian Customs considerations, and other certificates, permits, or licenses may be needed depending on the goods you’re shipping. This is where it helps to work with a company that knows the ins and outs of cross-border freight. Averitt’s international network provides shippers with full LTL and truckload coverage of Canada’s 10 provinces and three territories. So, if you have questions, don’t hesitate to contact your Averitt representative. G E T T I N G F R OM P O I N T A T O P O I N T B The U.S. Department of Transportation has no say over what happens in Canada. Instead, Canada’s own regulatory agencies and ministries dictate how American carriers are allowed to operate. This includes which commercial drivers are allowed access. American drivers and other CONT. PG6
A key reason for that strong relationship is the relative ease of transporting goods from one country to another via truck, which is supported by more than 120 land ports of entry lining the border. For any U.S. company looking to sell its products to our neighbor to the north, it’s important to understand several aspects of the sometimes- complex supply chains involved. T H E U SMC A The United States-Mexico-Canada Agreement (USMCA), originally signed on Nov. 30, 2018, became fully effective on July 1, 2020. Drafted as a replacement for the North American Free Trade Agreement (NAFTA), the USMCA was designed to create more balanced, reciprocal trade while growing the North American economy. While the USMCA retains a similar structure to NAFTA (leading to the nickname “NAFTA 2.0”), there have been some changes – most notably regarding rules of origin (ROO) requirements, labor enforcement, and revised de minimis levels (or low- value thresholds). These and other changes were made to bring the trilateral trade agreement in line with the times. (Remember that NAFTA became law in 1994 – long before the internet changed the face of commerce worldwide.)
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