Monday, February 21, 2022

FTZ 147: A Supply Chain Success Story

Thirty-five years ago, The Reading Chamber of Commerce filed an application with the US Foreign-Trade Zones Board resulting in the creation of Foreign-Trade Zone 147 (FTZ 147), the 147th such zone established in the US.  For perspective, as of the end of 2020, there were 298 FTZ’s in and around the various U.S. Customs Ports of Entry.  The original Zone covered the land at the Reading Municipal Airport.  
FTZ 147 now covers eleven counties in Southcentral Pennsylvania:

  • Adams County
  • Berks County
  • Cumberland County
  • Dauphin County
  • Franklin County
  • Fulton County
  • Juniata County
  • Lancaster County
  • Lebanon County
  • Perry County
  • York County

FTZ 147 got off to a slow start.  For various reasons no zone activity occurred until 1996 when Baker Refractories began to use the FTZ program to eliminate Customs Duties on imported magnesite.  That use was short lived as the United States eliminated the import duties on magnesite a year or so later.  While the zone grew by expanding the service area into additional counties, the use of the zone by companies stalled until 2005 when Clarks’ Shoe Company began importing footwear using FTZ procedures.  The next 15 years saw the explosion of zone use in FTZ 147.  The amount of merchandise moving thru foreign-trade zones in FTZ 147 went from $0.00 in 2005 to $14,073,059,437.00 in 2020.

In 2020, the most recent year statistics are available, FTZ 147 received over 10 times more merchandise in zone status than any other zone in Pennsylvania.  FTZ 147 ranks 5th in the nation, and 2nd for an inland port, for receipts of merchandise into warehouses in Zone Status.  FTZ 147 ranks 20th in the nation in terms of exports from warehouse zones.  Remember, FTZ 147 was last in the nation in 2005, just 15 years ago.

Companies can use foreign-trade zones to maintain the cost competitiveness of their U.S.-based operations in relation to their foreign-based competitors.  The fundamental benefit offered by the FTZ program to U.S.-based companies include:

  • Deferral of Duties
  • Reduction of Duties
  • Elimination of Duties

For the U.S.-based companies involved in international trade, the FTZ program provides a means of improving their competitive position in relation to their counterparts abroad.

For more information regarding U.S. Foreign-Trade Zones, please contact Randy P Campbell at FTZ@CampbellTradeGroup.com

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