1198 words 6 minute read – Let’s do this!
Man it kills my soul to fight the urge to not be PC and PG on these Market updates, but we’re thriving over here. Another week, same song and dance. The U.S. economy really should be better than this, but also it’s to be expected. 3 years post Pandemic craziness in a time when rate contracts pretty much just went out the window, we are back to fighting for better rates and fighting to stay in the game. I hate to say that this is normal as the industry all basked in the glory of maximum profits with minimal effort as we just tried to keep up with supply and demand as supplies dwindled during Covid shutdowns. Freight rates and volumes are always volatile, disruptions will always occur, sometimes larger and sometimes smaller, as we are keeping an eye on current Union labor disputes and threats of cyber attacks or crashes. And that is where the market updates come in. There was a great article posted on the JOC website breaking down how the ocean shipping market works and how it undergoes the process of normalization. Don’t equate ‘normal’ ocean shipping market to stability: analyst | Journal of Commerce (joc.com) Can we predict everything? no, but we can always keep you up to date, so do yourself a solid and subscribe to our Linkedin page, weekly newsletters and Port X Logistics blog.
Almost 6 months into 2023 and here we are. Thriving. But on a positive note we are approaching a long weekend and some summer sun. Let’s get hyped for the holiday!
Let’s talk about the Panama Canal situation. How could the drought in the Panama Canal affect supply chains? There are a lot of things that we are considering and talking with clients about.
- All water to avoid the canal so they can continue to put more container volume on ships. With the depressed rates and over supply this could be a reality. The all water option with delayed transit times may lead to the need to expedite cargo once it hits US East Coast Ports.
- Do some shippers take a chance?….Terminate cargo from Asia on the West Coast. This would give the West Coast ports a much needed boost, but the labor agreements with LongShoreman is still not finalized. With the west coast option more BCO’s may consider transloading and trucking the east coast.
- SSL’s just take less containers, use the canal, and hope they can charge shippers higher rates.
All of the options can affect transit times, reliability, and cost. At Port X Logistics, even as a trucker, we help clients evaluate their drayage, transloading, and trucking options. The one thing EVERyone is hoping for is no ships stuck in canals. (A little Dad humor to the 2021 Ever Given drama)
There is a possibility that OPEC+ could surprise the market with another output cut next week. Saudi Arabia’s energy minister, Prince Abdulaziz bin Salman, issued the threat earlier this week in his latest lashing out at oil’s short sellers. Saudi Arabia’s energy minister is arguably holding the reins of OPEC, which could decide to cut crude oil production again, sending prices soaring in what would surely be a painful outcome to many speculators and short sellers out there. The outcome of another output cut is unclear, but it also means that the market is starting to price in the possibility of another production cut when OPEC meets next week. This could loosen the blow of shock value-induced price hikes if OPEC actually does cut production—that will reduce short sellers from “ouching”. If OPEC decides not to cut, prices should go down at least temporarily, handing the short sellers a win. The winner (the term “winner” being questionable) shall be revealed next week.
Import TEU volumes are down 7.139% from last week, and with the upcoming U.S. holiday weekend, import TEU volumes are likely to be on the lower side next week as well. Reminder that many of the ports and rails are closed for at least one or more shifts on Monday May 29th so there will be delays, waiting times and rushing to get containers moving into next week. Most shippers and consignees will be closed on Monday as well causing possible extra layovers and per diem and demurrage scares. Don’t forget! Port X Logistics brought back our “NO DEMURRAGE GUARANTEE” for import shipments picked up from all coastal ports. If you’re able to send us your work orders at least 5 days prior to the vessel arrival and the container is cleared of all holds upon release, we are guaranteeing that there will be NO DEMURRAGE charges back to you. AND chances are if we get your orders sooner than that, we’ll still be able to get all shipments out within free time.
What’s happening at the ports and rails?:
You can find all the information on the below link where we cover port congestion, chassis issues and capacity lead times weekly at all U.S. and Canada Ports and rail heads
Highlights: With Monday’s Holidays, many ports and rails will be closed on Monday May 29th, check out the link above for the most up to date port and rail closures
Oakland: Drivers are still being turned away by clerks due to labor disputes, congestion is minimal. Expect full mayhem at Oakland next week, all shifts are closed Monday for the holiday and next week continues to operate on limited hours next week. Vessels In Port: 69 Expected Arrivals: 92
Miami: There has been increasing congestion at Miami and Port Everglades terminals linked to labor shortages and shift reduction. Current wait time at the terminals are in excess of 4 hours to retrieve full and return empty containers. The holiday closure could cause more congestion into next week. Vessels in Port: 253 Expected Arrivals: 37
Chicago: Mild congestion continues at the Norfolk Southern Landers railhead, something to keep an eye on as volumes could cause congestion to increase next week due to carriers and shippers being closed through the holiday weekend
Did you know? Port X Logistics is a premier sponsor for Empire State Ride – This extraordinary event is so much more than a bike ride, it’s a journey with a cause that’s close to our hearts. For those who don’t know, the Empire State Ride is an unforgettable adventure across the entire state of New York. Starting from Staten Island, it courses through the beautiful, diverse landscapes of New York ending at Niagara Falls. On top of spreading awareness, riders raise funds to support cutting-edge cancer research at America’s first cancer center dedicated to research, Roswell Park Comprehensive Cancer Center. We feel immense gratitude to be a part of this epic ride, an opportunity to challenge ourselves, connect with others, and make a difference. We celebrate every pedal stroke that takes us towards a world with more health, hope, and happiness!