Dock Strike & Peak Shipping Season Update

While everyone is busy enjoying their summer, the peak holiday shipping season is rapidly approaching. Whether or not you are in retail, peak season can affect your shipping plans as space gets tight and bookings require longer lead times.

To keep you current on issues that may impact your import/export plans, we have prepared a quick summary of what to watch out for.  So sit back, enjoy that cool drink while you can, and relax. This fall promises to be a real challenge for shippers.


USWC Dock Strike – All Quiet on the Western Front

ILWU StrikeIn what has, so far, turned out to be a non-event, negotiations between the Longshoreman’s Union (ILWU) and West Coast port operators continue. Both sides have pledged to negotiate in good faith and avoid any service disruptions, while the press blackout continues. The lLWU continues to operate without a contract and dock workers remain on the job.

The consensus on the street is that a strike is unlikely at this time, though there are never any guarantees.

However, even the possibility of a strike has resulted in many shippers accelerating their shipping plans, which has only served to further strain port capacity, especially with regards to trucking.  Trucks and chassis are in especially short supply Southern California and New York.

Truck & Chassis Shortage Worsens Nationwide

Truck & Chassis ShortageBetween the potential dock strike and the ongoing, nationwide truck/ chassis shortage, getting containers in and out of the harbor has become very challenging for all forwarders and shippers.

At the nation’s busiest port of Los Angeles/Long Beach, many ocean carriers are unable to schedule pickup or drop-off of containers without a lead time of 10 business days due to severe driver and equipment shortages.  Please plan your loads accordingly.

This situation is expected to continue or worsen as the peak holiday shipping season approaches.

Port Congestion in Europe Delays Imports

Port CongestionAs  if port conditions in the United States were not challenging enough, we have recently been advised by many of our partners in Europe that port congestion in Northern European ports (Bremen, Rotterdam, Antwerp, etc.) is bad and getting worse in advance of peak season.

In many cases, ocean arrivals/departures are being delayed by up to one week as ports struggle to keep up with volume. Once again, plan your timing on critical shipments accordingly.

Apple iPhone 6 Launch

iPhone6Many consumers are very excited about the rumored September release of the new iPhone 6 and other new Apple products ready to roll-out. Shippers and forwarders, not so much.

As with previous releases of new Apple phones, the Cupertino, CA based company has a habit of monopolizing air freight space out of China, as they struggle to get products to market in time for the September release and subsequent holiday season. Their volume is significant enough that it moves the needle on cargo space availability and raises rates.  Again, plan your shipping needs accordingly and book as early as possible. September could get very tight.

Wide-body Air Freight Returns to the U.S.

Boeing 767F Cargo Bay

Service Returns After a Three Year Absence

Affordable Option to UPS/FedEx

 

Air & Surface Logistics is pleased to announce the return of wide-body air-freighter service to the U.S. domestic air cargo market after a three year absence. After the closure of BAX (Burlington Air Express) in 2011, shippers were left with virtually no options other than FedEx or UPS to move their time-critical, palletized and over-sized air cargo. Both of those options are often cost-prohibitive. We’ve just changed all of that. (Didn’t know the freighters had disappeared? See our recent blog post here:  http://www.airandsurface.com/blog/overnight-air/ ) While much of this type of freight can be often be routed via expedited, team trucks, there are some cases where air freight is the only option.  When an assembly line is down, or product is needed for a date-specific event, sometimes air cargo is the best or only solution. That is especially the case on coast-to-coast moves. Air & Surface Logistics, in partnership with Miami based AmeriJet International, is pleased to offer shippers Boeing 767 freighter service to 13 key gateway cities nationwide, beginning July 7, 2014. Our expanded service will include:

  • Overnight and 2-day service
  • Monday-Saturday operation
  • Connection to our extensive international network
  • Bonded transfer service to Mexico
  • Integrated with our road network for service to secondary cities
  • Late cut-off and early recovery times
  • Confirmed bookings

For more information, please contact a customer service team member at team@airandsurface.com or 800-832-1207. Visit us at:  www.airandsurface.com

West Coast Dock Strike Update

Dock Strike

Photo Credit: The Journal of Commerce

Negotiations Continue as Contract Expires

Both Sides Pledge No Stoppage in Work

Source:  The Journal of Commerce

July 2, 2014


Update (07/07/14):  
As of this morning local ILWU organizers were apparently disregarding instructions from their union leaders and distributing flyers in the Long Beach/Los Angeles harbors in hopes of starting an unauthorized protest/picket line.  So far, work is still flowing normally, trucks are passing unimpeded and no picket lines have yet materialized.

Waterfront employers and the International Longshore and Warehouse Union did not reach a contract agreement by 5 p.m. today, as expected, but both sides indicated that there will be no cargo-handling disruption at U.S. West Coast ports while negotiations continue.

“While there will be no contract extension, cargo will keep moving and normal operations will continue at the ports until an agreement can be reached between the Pacific Maritime Association and the ILWU,” the parties said in a joint release.

“Both sides understand the strategic importance of the ports to the local, regional and U.S. economies, and are mindful of the need to finalize a new coastwide contract as soon as possible to ensure continuing confidence in the West Coast ports and avoid any disruption to the jobs and commerce they support,” the ILWU-PMA release stated.

Expiration of the previous contract also means that the “no-strike” clause contained in ILWU contracts has expired. However, by stating that “cargo will keep moving,” both parties were sending a message to the shipper community that neither a strike nor a lockout is anticipated as a way to influence negotiations.

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US Customs Issues Interim Procedures In Case of West Coast Dock Strike

Ocean Freight

With less than a week remaining until the current contract between the International Longshore and Warehouse Union (ILWU) and the Pacific Maritime Association (PMA) expires,  U.S. Customs (CBP) has published interim procedures in the case of a West Coast dock strike.  Click here for a link to the CBP whitepaper with detailed information on the interim procedures.

meanwhile, a coalition of trade groups representing manufacturers, retailers and transportation providers urged both sides to wrap up negotiations and avoid a strike.  The current contract expires at midnight on June 30. PMA President Jim McKenna said throughout the spring that he expects an agreement to be reached by by mid-July, meaning a strike is possible.  While it is possible that the longshoremen could continue to work without a contract, the liklihood of that happening is unkonwn.

Even with assurances, the prospect of yet another disruption of West Coast port activity has shippers looking for alternatives, including routing some cargoes through East, Gulf or Canadian ports. No matter the precautions, huge numbers of containers would be affected in the event of a strike or lockout. West Coast ports handle more than two-thirds of U.S. retail container cargoes, including the vast majority of goods imported from Asia, with total volumes of around 20 million 20-foot equivalent units (TEUs) a year. The costs of a potential closure are already being felt, with carriers announcing a precautionary congestion surcharge of $800 per 20-foot container and $1,000 per 40-footer. In the event of a complete stoppage, estimates on the impact on the economy are anywhere from 1 to 2 billion per day according to trade analysts (see link to JOC article below).

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