As we ease into April, with tentative enthusiasm for the new season, the global supply chain keeps us grounded in reality. Little has changed this year when it comes to moving freight. Here’s what you need to know this month in the state of freight.
- China and Hong Kong are currently experiencing their worst Covid outbreaks since the pandemic started in 2019. Border restrictions, port closures, long quarantines, lockdowns, and extensive vaccination checks have slowed travel in China to a crawl.
- Port conditions continue to remain unstable in China. Shanghai city is on lockdown and the port is shut down causing higher volumes of freight siphoning through surrounding ports such as Yantian/Shenzhen and Hong Kong.
- Land restrictions between China and Hong Kong are still active and make it difficult to transport products into Hong Kong port in a timely manner. Deliveries to Hong Kong from China are facing long quarantine wait times and high transport pricing
- Rolling vessel schedules, congestion, and higher freight charges are expected to continue throughout this month. This is still due to Covid restrictions, surrounding port lockdowns, and rising fuel prices.
- What is GPI doing to help alleviate some of these supply chain issues?
- GPI continues to follow the suggestions of supply chain experts and is starting the booking process at least 4 weeks in advance of production completion dates to ensure the best chances to secure vessel space and get products on the water as quickly as possible.
- GPI has been booking most shipments to depart out of Yantian, China instead of Hong Kong port to avoid border delays.
- For shipments that are scheduled to depart out of Hong Kong, GPI’s factories have secured a weekly vessel to deliver goods from China to the Hong Kong port via the sea to avoid delays on land.
- Congestion conditions along the West Coast have improved slightly in the last two months, largely due to the lull in arriving vessels due to the Lunar New Year in February. This gave the West Coast ports a chance to clear some of the containers building up in container yards.
- That being said, we are expecting another vessel/container surge within the next 2 months as we start to see the current congestion in Asia reach the US ports.
- Chassis shortages still plague both East and West Coast ports as well as major train hubs across the US. This is largely due to limited warehouse capacity and labor shortages. Containers waiting for appointments at US Warehouses are using up chassis that could be freed to move more cargo.
- Labor Negotiations began in March between West Coast longshoremen and their employers as their 4 year contracts are up. Negotiations are expected to go on for months and cause even more strains on an already dissolving supply chain. This just means more West Coast delays for businesses who only want their goods delivered.
- The train station in Chicago continues to experience severe congestion causing lengthy delays for containers waiting to be moved to their destinations. If you have goods routed through Chicago, 5 to 14 day delays are expected.
- Why is there a loaded cargo ship sitting off the coast of Maryland? This is where the Evergreen vessel ran aground in 25 feet of water on March 13, 2022. It may have been over a month ago, but it’s still stuck in the mud. Efforts to dig and tug the container ship free have failed and after weeks of trying, the port administration and Coast Guard are working to remove containers from the vessel to float it into deeper waters. Once it’s freed, the removed containers will once again be loaded onto the vessel and sent on their way. Time will only tell when the vessel will be back on the move.
As always, GPI is here to help you navigate the oceans, roads, and rails your goods travel upon. Please feel free to reach out to our Freight Department if you have any questions.