North American Ocean Market Update
US PORT NEGOTIATIONS STALL
Labor talks between U.S. port employers, represented by the United States Maritime Alliance (USMX), and the International Longshoremen's Association (ILA), representing dockworkers along the U.S. East and Gulf Coast ports, have come to a halt over automation disputes.
Set against a backdrop of longer transit times and higher costs, Xeneta's chief analyst, Peter Sand, said the possibility of strike action may force importers to pull forward efforts to safeguard their ocean-based supply chains, which could lead to a continuous cycle of disruptions for the container freight shipping market.
While past strikes at U.S. ports have seen shippers use airfreight to avoid shipping disruptions, strike action at East and Gulf Coast ports does offer shippers the option to utilize services via the U.S. West Coast and then use intermodal transport to reach their planned destinations, which will help relieve some of the pressure on airfreight.
The ILA contract expires on September 30. The union’s leadership has previously stated that ILA members would go on strike if an agreement is not reached. Full article can be read here, ILA
2ND GRI IMPLEMENTED AS TRANS-PAC MARKET STRENGTHENS
SSL’s have implemented a second GRI from Asia for June 15, 2024 ($1000/FEU). This comes as capacity tightens as the east bound trade market is strengthening. US Cargo ports prepare for busiest import period over next several months. In the latest Global Port Tracker report, released jointly by the National Retail Federation (NRF) and Hackett Associates, NRF Vice President for Supply Chain and Customs Policy, Jonathan Gold, attributes an anticipated surge in U.S. cargo imports to higher consumer spending and retailers replenishing inventories ahead of the peak shipping season.
“The high level of imports expected over the next several months is an encouraging sign that retailers are confident in strong sales throughout the remainder of the year. Unfortunately, retailers are also facing supply chain challenges again, this time with congestion at overseas ports that are affecting operations and shipping rates,” Gold said.
Ben Hackett, founder of Hackett Associates, said the import surge is expected to surpass two million TEUs over the next seven months, which he pointed out is partially due to shifts in the traditional peak shipping season. “In the last couple of years, we have witnessed a flattened peak season that has stretched out the volume of imports over extra months versus the strong, consolidated surge seen in the past.” Full details can be found here, NRF
CAPACITY AND COSTING:
ASIA-USA/CANADA
Imports continue to surge, rates increasing rapidly due to stronger market demand and limited capacity
Demand is high, space is tight. Carriers offering GUARANTEED SERVICES once again, at a premium cost
Forecast/Bookings recommended 28 day advance notice prior to Cargo Ready Date
SSL Routings continue to adjust to account for high demand and blank sailings
Europe to USA/Canada
Demand has increased, PSS is anticipated for JULY
Space availability still tight due to Red Sea Crisis
Forecast/Bookings highly recommended 28 day advance notice prior to Cargo Ready Date
Rates creeping upward, and will continue as capacity tightens
India to USA/Canada
Space is tight and equipment is a challenge, especially at ICD’s
ICD points still lack equipment and are experiencing delays via rail
Forecast/Bookings recommended 37-47 day advance notice from Cargo Ready Date
Rates are remaining starting to climb
Transit times are increasing due to rerouting of vessels
To discuss your cargo or solutions on particular lanes, please contact your South East World Wide (Chicago), Ltd. Sales Representative.