Weekly Roundup – June 13, 2024

Welcome back to the weekly roundup, where we provide concise summaries of the most important supply chain and logistics stories of the week. Covering breaking news, emerging threats, and changing market dynamics, it contains all the news you need to maintain a competitive advantage.

Biggest U.S. ports union suspends labor talks, with East Coast, Gulf Coast strike risk rising

The International Longshoremen’s Association (ILA) has suspended negotiations with the United States Maritime Alliance (USMX) due to the unauthorized use of an Auto Gate system by APM Terminals and Maersk Line, which processes trucks without ILA labor. This system violates the existing Master Contract, leading the ILA to halt talks until the issue is resolved. The union is concerned about job losses due to automation, a trend pushed by Maersk, and is awaiting an audit on jobs created by new technology. The ILA criticizes the Biden administration for allowing foreign companies to undermine American jobs and demands strict contract enforcement to protect its members.

Logistics players brace for US supply chain stress test as imports hit a high

US imports are set to reach their highest volume in two years, posing a challenge for supply chains. The Global Port Tracker predicts a seven-month streak of monthly import volumes exceeding 2 million TEU, driven by consumer spending and retailer restocking. Despite no current major disruptions, logistics providers anticipate congestion, particularly in the rail system and at port land sides. Supply chains have struggled to recover from pandemic-related issues, with ongoing rail delays and drayage problems. The upcoming surge will test the resilience of the logistics infrastructure, potentially revealing the same vulnerabilities seen in 2021 and 2022. Industry experts urge preparation and contingency planning to navigate the expected stress on the system.

Global Trade Is on the Rebound. Are Suppliers Getting the Benefit?

Global trade is rebounding, with the U.S. and China experiencing significant growth, according to Tradeshift’s Q1 Index of Global Trade Health. Although transaction volumes have increased, they still fall short of expectations, marking the ninth consecutive quarter of such shortfalls. The U.S. saw robust order volumes, while China showed signs of recovery after a sluggish second half of 2023.

Despite this positive trend, suppliers face ongoing liquidity challenges, exacerbated by slow payment practices and high interest rates. These issues are further intensified by global trade tensions and tightened bank lending. Suppliers are increasingly turning to alternative financing, such as supply chain finance and dynamic discounting, to manage cash flow. However, smaller entities remain disproportionately affected by credit gaps and economic volatility. New data-driven financing methods could help mitigate these challenges by offering better risk assessments based on trade histories and buyer-seller relationships.

Shippers, agencies plan for full return of Baltimore-bound cargo

As the Port of Baltimore prepares to fully reopen following the collapse of the Francis Scott Key Bridge in March, shipping lines and federal agencies are planning for its recovery. Temporary shipping lanes were established, but full access to the main Fort McHenry Federal Channel is expected between June 8 and June 10. Many shipments had been diverted to other ports, but major carriers like Maersk, MSC, and Hapag-Lloyd are resuming or planning full operations at Baltimore. Federal agencies are coordinating efforts to smooth the transition, emphasizing communication with stakeholders to manage potential bottlenecks and ensure a seamless return to normal operations.

Evergreen splashes out $500m on feeder vessels and more containers

Evergreen is investing over $510 million in new ships and containers. The Taiwanese operator has ordered six 2,400 TEU methanol dual-fuel ships from CSSC Huangpu Wenchong Shipbuilding for $348 million and 50,000 containers from Dong Fang International, China International Marine Containers (CIMC), and Singamas for approximately $162 million. The ships, set for delivery between 2026 and 2027, will likely serve intra-Asia routes. This investment aligns with Evergreen’s decarbonization goals, adding to its fleet of methanol-fueled vessels. Evergreen’s substantial investment reflects optimism about the future demand for liner shipping, supported by a 36% year-on-year increase in cumulative revenue to $4.7 billion for the first five months of 2024.

Wan Hai and Cosco launch more transpacific services as rates soar

Wan Hai and Cosco have launched new transpacific services in response to rising freight rates. Wan Hai’s Asia America I (AA1) service, connecting Shekou, Qingdao, Ningbo, and Long Beach, began with the 3,013 TEU Wan Hai 361 and will operate with six 3,000-4,530 TEU vessels on a six-week turnaround. This move comes as Asia-US west coast rates surged 19% week on week, reaching $6,168 per 40ft on 31 May. Wan Hai plans to expand its transpacific and Asia-South America services, with transpacific and South American routes being major revenue sources. Simultaneously, Cosco and its subsidiary OOCL have started the China Pacific northwest Vancouver loop (CPV), using six 4,250-7,100 TEU vessels on a six-week rotation.

Share this article

Subscribe for insights:

Popular Insights

Request A Quote

Quick Rate Quote