It may not be “normal”, but it’s certainly close. The supply chain appears to have recovered from the slew of pandemic-related issues it’s suffered from for the past 3 years. Congestion has cleared, container backups are gone, transit times are down and pricing has returned to 2019 values. It’s time to celebrate, right? Let’s find out in this month’s state of freight.
Operations at Asia’s ocean ports are currently running smoothly. Blank sailings or rolling schedules are becoming more frequent as export volumes are not as high as they have been in previous years.
GPI is not experiencing any delays at US ports currently. West, East, and Southern Coasts are all quickly processing incoming vessels in a timely fashion.
Volumes are down for ocean freight due to full US Warehouses and a shift from products to services. May is marking the end of the pandemic and while the US opens back up, the need for products has waned as folks are eager to spend their earnings on vacations and services more than tangible products. This may be starting the year off slowly, but the holidays will be here before we know it and GPI expects the need for products (especially games) to pick up pace by the latter part of the year.
As restrictions in Asia loosen, more commercial flights are opening to the public. This means more cargo space for freight in the bellies of those planes. While this is a good thing, we’re still not seeing air freight pricing drop. This is due to fuel prices remaining at top dollar. Although required in certain circumstances, GPI does not recommend air shipping your goods unless it’s absolutely necessary.
GPI is not experiencing any delays in trucking. This is, however, the stormy season so your trucking deliveries will be directly affected by the weather happening in your area.
Very slight delays of 3 to 4 days may influence the transit times of your rail deliveries. These delays are mostly involving Vancouver and Prince Rupert.
TO STRIKE OR NOT TO STRIKE
The International Longshore & Warehouse Union (ILWU) and the Pacific Maritime Association (PMA) are still without a contract 10 months after promising to put a hold on the strike. When contracts expired in July 2022, the US President stepped in to prevent a dockworker strike and ILWU agreed to comply and continue to work while negotiations progressed. It’s almost been a year and still no agreements have been made. The situation for the dockworkers has also deteriorated. When the threat to strike first began, dockworkers were desperately needed. Congestion reigned in the ports, backups were the norm and dock workers were the only way out. Fast forward to today, negotiations continue but West Coast volumes are down considerably this year, 45% less so far. Several different factors influence this drop in volume: full US warehouses, the public’s switch to services over products, or the unrest of a dockworker strike. Whatever the reason, dockworkers are suddenly less in demand than they were a year ago. Many companies that regularly ship to the West Coast have changed their shipping routes and switched to Southern or East Coast ports for fear that a strike is inevitable. The pressure is now on the ILWU to produce an acceptable contract within the next few months that both dockworkers and PMA agree on. If they can’t come up with something, we may just be looking at a dockworker strike in the next few months. West Coast shipments will be business as usual through July. As July creeps closer, GPI will be staying on top of the situation and let you know how to plan your upcoming shipments.
By the way, are you wondering what the dockworkers are asking for in their contract? Here are just some of the things they hope to get with this contract:
- Higher Wages
- Sick Time
- Work less than 19 days in a row without a day off
- Guaranteed jobs as ports use technology to automate tasks
Have a freight day!!!
Erin Gagne, GPI Logistics Coordinator