Ocean
The COVID-19 outbreak at the Yantian Port continues, causing congestion issues to spread across Southern China. COVID-19 outbreaks are getting worse at Yantian, further disrupting port operations, with delays expected to stretch into two weeks. This congestion at the port is spreading throughout Southern China as well, creating a scale of disruption greater than the Suez Canal blockage that lasted for six days. Paired with eastbound Trans-Pacific demand outpacing vessel capacity and low ocean reliability, supply chain experts are warning of serious ripple effects to come.
Due to this increased delay, container lines are adding more alternatives to the congested Yantian port by increasing the number of load ports. Shippers are also looking to ship via Hong Kong, Shanghai, and Ningbo, and other ports like Nansha and Da Chan Bay. If you have any questions regarding congestion at the Yantian port or are looking for other ways to go around this port, contact one of our experts.
A crane collapsed at the Port of Kaohsiung in Taiwan, damaging containers. An empty vessel struck a laden cargo ship, causing the collapse of a crane that damaged between an estimated 30 to 50 containers and injured one worker. The cause of the incident is under investigation. If you had containers at this port, they may be affected.
Customs
The University of Houston published an assessment of the Customs-Trade Partnership Against Terrorism (CTPAT) Program. The CTPAT Program was established in November 2001 to enhance border security via strengthening international supply chains. This assessment addresses tangible and perceived member benefits, return on investment for the participants, and cost savings for the U.S. government and trade partners. You can read the full report online at the University’s website.
The Department of the Treasury’s Office of Foreign Assets Control (OFAC) implemented sanctions on Myanmar (Burma). In response to the military coup in Myanmar (Burma), sanctions have been implemented on the country. OFAC will supplement the sanctions in the future, but to view the existing sanctions and see what’s already in effect, check out the Federal Register’s website.
Ports
Carriers reroute cargo and suspend trans-Pacific calls in Oakland. Zim Integrated Shipping Services will reroute its premium service from China to Oakland to call only in Los Angeles, citing backlogs and congestion at the Oakland port. With vessel delays of 10 to 12 days at Oakland, this service can no longer maintain its original standards of guaranteeing vessel space in Asia.
Additionally, Hapag-Lloyd will join Zim in dropping its trans-Pacific westbound calls in Oakland for the same reasons. There is a plan to return to those services in Oakland around mid-August if congestion clears. According to the CMA CGM website, trans-Pacific Oakland calls were dropped and others scheduled through August will be left out.
Air
The International Air Transport Association (IATA) released data for global air cargo markets for April 2021. From this data that IATA released, it was found that air cargo demand continued to surpass pre-pandemic levels with demand up by 12%. Read more about the statistics of how the COVID-19 pandemic impacted air cargo levels in a report by the IATA online.
European air cargo carriers open up more flights, creating more capacity for ocean-shy shippers. Emirates SkyCargo and Qatar Airways will resume flights from Birmingham, UK, pleasing forwarders. Opening up more space at the Birmingham Airport will allow forwarders to avoid congested routes and gateway airports, and work around the unprecedented ocean capacity and congested ports in China.
Trucking
Trucking companies run out of capacity as imports and drayage demand surge. In the U.S. Southeast, trucking companies are warning that they are low on capacity as a year of imports from Asia creates record-breaking drayage demand. National and regional drayage providers in the Southeast are all booked and are unable to serve new clients, which leaves importers and ocean carriers to find smaller trucking companies and paying extra to move import containers from Charleston, Savannah, and Norfolk.
Truckers raise fees on excessive dwells for containers and trailers. J.B. Hunt Transportation Services and Schneider National are raising fees for shippers who hold onto trailers beyond their allotted free time. Trucking executives say that this problem has worsened over the year and is part of the reason for congestion at rail ramps.
J.B. Hunt is raising fees from $50 to $100 each day for the first three days that equipment is held after the three free days, and then $150 after four days, and $200 per day for nine days. Schneider is taking a similar approach, raising fees from $50 to $125 per day once the two-day free clock expires.
Rail
BNSF Railway and Union Pacific Railroad (UP) combat congestion issues in Chicago. Amid another import surge over the last eight weeks, the two railroads are struggling to find space in Chicago, and in turn, frustration amongst truckers, importers, exporters, and port officials is growing. To combat congestion, BNSF announced it would eliminate track to create more storage space in Low W within its Logistics Park Chicago facility. UP will continue its “no ‘cherry picking’ policy, but has also begun ‘grooming’ stacks with the longest dwelling containers on top to speed the mounting and pickup of import boxes once chassis becomes more available.”
Other
Biden will launch a task force to address supply chain bottlenecks. After a 100-day review of supply chains, the Biden Administration will form a supply chain task force to address the bottlenecks in the semiconductor, construction, transportation, and agriculture sectors. With this task force, the goal is to increase domestic manufacturing, decrease shortages of vital goods, and try not to rely on geopolitical competitors like China.
