Sunday, February 19, 2017

DHL Express - Amazingly Slow



What is it that makes leading global logistics companies nervous about handling food consignments to Japan?

Over the past few weeks, I have been witness to an uncharacteristic display of tardiness from one of the big boys in logistics - DHL Express. Until now, my experience with this German company had been pretty good. Even though they charged a premium they have been able to deliver documents from Japan to India in three days' time. Food samples, however, seems to be an altogether different ball game.

Japan is one of the leading food importers in the world.  The country's total food self-sufficiency ratio based on calorie supply was just 39% in 2015. Based on production value, it was just 66%. So the country relies almost entirely on imports, not only for staples like wheat, barley, corn, and soy, but also a wide range of raw materials for its food processing industry.

Half of the meat products consumed in Japan is imported. According to a survey by the Japan Frozen Food Association of 31 member companies, 200,634 tons out of 315,436 tons of precooked frozen imported food in 2006 came from China. Farm ministry data show that of the roughly 778,000 tons of frozen vegetables imported that year, about 326,000 tons came from China and 285,000 tons from the U.S.

Despite these high volumes import regulations are strictly enforced. The key organisations involved are -

  • Ministry of Health, Labor an Welfare (MHLW) -- sets standards for chemicals in food -- monitors compliance
  • Ministry of Agriculture, Forestry, Fisheries (MAFF) -- Registers agricultural chemicals -- Approves and controls Veterinary drugs and their uses -- Set standards for feed. The key department here is the Dept of Food Safety under the Pharma and Food Safety Bureau of MAFF.
  • Food Safety Commission
  • Consumer Affairs Agency


Fronting all these ministries and agencies is the Japan Customs Office which keeps close watch on all the international airports and ports. Even before a food consignment is loaded on a ship or aircraft, a 24-hour advance notice is to be send to the customs office. This rule, referred to as the Japan Advance Filing Requirements (AFR/JP24) has been enforced since March 10, 2014. Under this, a 10-point checklist is to be submitted along with the Bill of Lading.

All these rules and regulations have been around for over three years. Despite this, what explains the repeated delays by DHL, in dispatching a consignment of food-samples to Japan?

Consider the case of a 5kg packet sent on 7 Feb., 2017, by an exporter of Moringa plant products (dried leaf, powder and seed oil) to Yokohama, Japan. The DHL office at Theni (TN) accepted the packet after confirming that all the necessary paperwork was in place. This included a signed declaration by the exporter, a Sanitary & Phytosanitary Certificate (SPS) from the authorized government agency at Tuticorin, and a Material Safety Data Sheet (MSDS).

The packet (waybill no. 7840177741) then moved to Bangalore, and stayed put for the the next three days. When asked the reason for the delay, DHL stated that it needed each page of the declaration to be signed by the exporter. Yet this requirement was not informed while the packet was being accepted, nor did DHL bother to inform the exporter from its Bangalore office. It was only when the customer contacted DHL that the response came up - "Oh, yes, by the way, we need some more paperwork!".

After a weeks' delay, a fresh Shipment Waybill (No. 7840177262) was raised with the signatures on all the pages. Then again the packet got stuck at the DHL warehouse in Bangalore. This time they came up with yet another requirement -- over and above the "non-hazardous" certificate given by the Indian government agency, DHL needed another self-declaration from the exporter stating that the seed-oil was non hazardous in transit the flight to Japan.

Today, nearly two weeks after the packet was handed over to DHL Express, the packet has finally reached Yokohama.

So the question that begs an answer is: Is it Japan's Customs Office that is making shipments from India difficult, or is it the DHL office in India simply incompetent when it comes to handling consignments to Japan?

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LINKS & REFERENCES

FAO requirements of Phytosanitary Certifications - http://www.fao.org/docrep/004/y3241e/y3241e06.htm

(2008) - The Tokyo Foundation -- the Perilous decline of Japan's agriculture -- http://www.tokyofoundation.org/en/articles/2008/the-perilous-decline-of-japanese-agriculture-1

Food Exports from India to Japan - Phytosanitary Requirements -- http://phytosanitarysolutions.com/japan/

Japan's Import dependency - http://www.businessinsider.com/japan-will-be-asias-superpower-in-2040-2017-2

Japan Customs website - http://www.customs.go.jp/english/summary/advance/

Procedures for Private Import Cargo - http://www.customs.go.jp/english/exp-imp/privatecargo/private.htm#courier

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