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Biden and Allies Issue Sanctions Against Russia, Slack and Others Go Down on Twosday, and U.S.-Canada Cross-border Truck Rates Remain High After Protests

By February 24, 2022 No Comments

Ocean  

Update on A.P. Moller – Maersk services amid Russia/Ukraine crisis.  As of Feb. 24, all Maersk workers were directed to work from home, away from any crisis zones. They’ve also put in place a business continuity plan to ensure that they can continue to meet clients’ supply chain demands as long as the scenario allows. Due to the present conditions, Maersk has chosen not to call any Ukrainian ports until further notice and has ceased accepting orders to and from Ukraine until further notice. Meanwhile, services in Russia are still available, although they may be limited in the future. Cargo already en route is scheduled for discharge at Port Said and Korfez. Visit the Maersk advisory web page where the latest situational updates will be added daily.

Busan expects new terminal will reduce congestion, increase transshipment. In April, Busan will launch the first berth of a new HMM-backed semi-automated container terminal, which is anticipated to relieve congestion and reduce missed calls at the South Korean port. The new terminal, which can handle boats up to 23,000 TEU, will have 11 quay cranes and 44 automated rail-mounted gantry cranes. Busan Container Terminal (BCT) is developing it as part of an expansion of container port facilities pushed by Busan Port Authority (BPA), which plans to accommodate 32 million TEU by 2030.

ONE, Maersk increased sailings and loaders to counter missed trans-Pacific calls. Ocean Network Express (ONE) is adding trans-Pacific sailings between North Asia and the U.S. West Coast for at least the next three months to benefit merchants in South Korea and Japan. The journeys include express transits and sweeper services for Japanese exporters. Shippers in South Korea and Japan have been notably affected by the lack of trans-Pacific connection, with carriers omitting calls or canceling sailings as container lines strive to preserve or restore schedule dependability on mainline routes. ONE’s move coincides with Maersk’s plans to deploy extra gap loaders to offset missed sailings in Prince Rupert and Vancouver.

Fire on deserted cargo ship carrying over 1,000 luxury vehicles in Atlantic finally going out. In the Atlantic Ocean, an abandoned cargo ship holding over 1,000 Porsches and other expensive vehicles is on fire. On Wednesday, a fire broke out on the Felicity Ace. According to the country’s military, the ship was cruising around 90 kilometers southwest of the island of Faial in Portugal when the flames erupted. According to Snowcape Car Carriers, the ship’s owner, all 22 crew members on board were rescued by members of the Portuguese Air Force and are in “good health.” The fire on board may be extinguished shortly because now, a full five days after it began, there isn’t much left to burn.

Customs

President Biden signs executive order for sanctions against Russia. The President has signed a new Executive Order Blocking Property Of Certain Persons And Prohibiting Certain Transactions With Respect To Continued Russian Efforts To Undermine The Sovereignty And Territorial Integrity Of Ukraine. Read the full text of the President’s Executive Order here.

Ports

Expect delays through H1 terminals though LA-LB port traffic improves. Cargo flow through the ports of Los Angeles and Long Beach has improved in recent weeks as a result of efforts in removing empty containers from the docks and a rise in labor availability, according to stakeholders at the country’s biggest port complex. While Southern California ports, which handle almost half of all U.S. containerized imports from Asia, are projected to face terminal congestion and vessel backlogs in the first half of the year, terminal operators said cargo flow is certainly improving.

Charleston congestion causes sudden export embargo. The Port of Charleston will not accept loaded exports at its Wando Welch Terminal on Thursday and Friday mornings because the port is running out of room due to a flood of import containers that cargo owners are failing to pick up on time. The restriction on export shipments will be in effect from 5:00 a.m. to noon on Thursday and Friday, according to a statement issued by the South Carolina Ports Authority (SC Ports) late Wednesday. Empty containers and temperature-controlled goods will be welcomed, however, drivers with export loads in standard dry containers will be turned away.

California has designated state sites for container storage. As part of a drive to free up space at major ports, California has struck an agreement with an online warehousing marketplace to manage six temporary off-port container storage sites on state-owned land. The locations were identified as part of Governor Gavin Newsom’s October executive order to identify property for container storage outside of the ports of Los Angeles, Long Beach, and Oakland, according to the state’s Department of General Services. According to the agency, Chunker, which provides an online marketplace for seeking warehouse space, secured one-year contracts with an option for a second year to run the sites.

Air

DHL’s new freighter enters Vietnam’s airfreight market. DHL Express has introduced a cargo flight from Vietnam, due to increasing trade with the U.S. and a quickly growing semiconductor industry. The specialized B777F will be operated by Kalitta Air and will fly once a week between Ho Chi Minh City, Sydney, Singapore, and Nagoya before landing at the integrator’s Cincinnati location. The new route joins DHL’s A330 Ho Chi Minh-Hong Kong service, which operates six times per week, and adds 102 tons per week for consumers in Vietnam, representing a 27% increase to over 940 tons of weekly total gross payload.

Expeditors’ business disrupted following cyber attack. Expeditors International’s global operations are being disrupted after becoming the latest supply chain business to experience a cyber attack. The organization informed consumers that it had been the victim of a targeted cyber attack. The forwarder stated that it is working with global cyber-security specialists to remedy the matter, but that systems may be unavailable while it examines and stabilizes its systems and implements backup processes.

Lufthansa Cargo moves towards going paperless. From March 27 this year, Lufthansa Cargo will only accept shipments with an electronic air waybill (eAWB) on ‘feasible lanes.’ In addition, the airline is launching a paper-to-eAWB service, in which the few remaining paper-based AWBs will be digitized at cargo acceptance and will thereafter accompany the shipment as an eAWB. The initiative is part of a big push by the German carrier toward fully paperless delivery. All forwarding firms who do not yet use electronic air waybills must use the newly launched service on feasible lanes. In 2020, IATA declared an industry target of achieving 100% eAWB by the end of 2022, which means that all shipments will only be transported using eAWB.

Rail

Federal judge ruled unions cannot strike over BNSF attendance restriction. A federal court has determined that two major rail unions cannot strike against BNSF over their disagreements with the railroad’s new “Hi Viz” attendance policy. According to Judge Mark T. Pittman of the U.S. District Court for the Northern District of Texas in Fort Worth, the dispute between BNSF (NYSE: BRK.B) and the Brotherhood of Locomotive Engineers and Trainmen (BLET) and the International Association of Sheet Metal, Air, Rail, and Transportation Workers – Transportation Division (SMART-TD) is a minor dispute under the Railway Labor Act. As a result, the unions are unable to go on strike in protest of BNSF’s Hi Viz attendance policy, which went into effect on Feb. 1. Hi Viz is an abbreviation meaning “high visibility.”

Trucking

Cross-border truck rates between U.S. and Canada remain high after protests. Protests by Canadian truck drivers that disrupted trade and traffic at many crossings along the U.S. border may be over, but cross-border shippers are still feeling the effects of rising trucking rates during the protests. According to DAT Freight & Analytics, spot dry-van rates from Phoenix to Windsor, Ontario, are $0.99 more than the January average, reaching $3.35 per mile on Friday. That is only one lane, but according to DAT data, spot rates to Canada and places close to the border, such as Detroit and Buffalo, are higher in several markets. Higher transportation costs might be a long-term effect of the disruption in cross-border trade.

Other

Russia sanctions might produce sudden and considerable increase in gas costs. Russian soldiers started their long-awaited invasion of Ukraine on Thursday, sending shockwaves across financial markets and heightening concerns about the implications for global gas supply. Russian President Vladimir Putin ignored international outrage and the first round of sanctions by proclaiming the start of a “special military operation” to “demilitarize” Ukraine. European gas prices rose in response to the invasion, as Brent crude futures reached $100 per barrel for the first time since 2014. The U.S., Canada, the U.K., the European Union, Australia, and Japan were among the nations that announced the first round of sanctions against Russia earlier this week, targeting banks and wealthy individuals. A second round of sanctions is largely expected to follow soon.

Bob Curry Sr., pioneer in drayage, passed away at 90. Robert (Bob) Curry Sr., the former president and CEO of California Cartage, who transformed the firm from a Southern California drayage carrier to a logistics and warehouse operator at key ports and inland destinations across the U.S., died on Feb. 9, at the age of 90. Curry had a significant impact on the harbor-related supply chain, from the beginnings of containerization in the 1960s to trucking deregulation in the 1980s to today’s environment, where drayage operators are transitioning from trucking-only to full-service third-party logistics providers with warehouse operations.

Following a brief suspension, U.S. allows Mexican avocado shipments to resume. Following a temporary ban, the United States Department of Agriculture announced Friday that imports of Mexican avocados may continue. A week ago, one of the USDA’s Animal and Plant Health Inspection Service inspectors in Mexico was threatened, causing imports of the fruit from the border country to be halted. However, after working with the U.S. Embassy, Mexico’s national plant protection organization, and an avocado trade association, the agency said on Friday that new security measures had been implemented to solve the security concern. Inspections in Michoacan have resumed, and avocado exports to the U.S. have resumed.

Peloton, Slack, Microsoft’s GitHub back up and running following outages. According to the websites and Downdetector, which monitors internet problems, Peloton Interactive Inc., Salesforce.com Inc.’s Slack, and Microsoft Corp.’s GitHub all recovered from widespread service disruptions on Tuesday. In their workplace chat app, Slack customers received the warning “something’s gone amiss, and we’re having difficulties loading your workspace.” According to Downdetector, the outage occurred about 9 a.m. New York time and was reported by as many as 11,000 customers. The problem was resolved within a few hours.