COVID-19 Latest Updates

Ocean Schedule Reliability Keeps Declining, Hurricane Ida Stalls Supply Chains & Ports, & CSX Restricts Domestic Container Flows in Chicago

By September 2, 2021 No Comments

Ocean  

Ocean schedule reliability keeps declining. Due to ongoing supply chain disruptions such as COVID-19, severe weather events, and ongoing port congestion, the weekly late notifications from shipping lines for shipments exported out of China rose 32% since the beginning of August. At the ports of Shanghai, Ningbo, and Yantian, delays are growing past three days, and the overall supply chain delays are growing from weeks to months. 

Meishan Island International Container Terminal (MSICT) at China’s Ningbo Port has officially reopened. Two weeks after the facility closed due to a COVID-19 outbreak, the port’s terminal has reopened, and truckers can begin picking up containers. The reopening of this port reassures shippers that the disruptions related to this closure will not be as severe as the Yantian Port closure in late June. Vessels displaced from MSICT, however, are now calling at other terminals at the port, which is also adding more congestion. 

Vietnam’s lockdown continues, stalling supply chains and slowing production. Nearly 60-70% of manufacturers have halted production in Ho Chi Minh City because they weren’t able to meet the standards to stay open as COVID-19 outbreaks continue. This has resulted in booking cancellations, and the strict lockdown in Ho Chi Minh City will continue until September 14. Severe equipment shortages are expected when these factories open up in the upcoming weeks. 

Ports 

Hurricane idea halts operations at NOLA port. Since Hurricane Ida hit the Gulf Coast, the New Orleans Port has been closed, and there is no clear indication when the port will reopen. Lack of power at the terminal continues to hinder the ability to reopen for operations.

The following ports will be closed on Labor Day (Monday, September 6, 2021): Charleston, SC; Houston, TX; Long Beach & Los Angeles, CA; Mobile, AL; Norfolk, VA; Oakland, CA; Savannah, GA; Seattle/Tacoma, WA; Wilmington, NC.  

Surges in holiday orders congest vessels at U.S. ports. At New York-New Jersey, there are some slowdowns during the pre-holiday peak as there is an uptick in berthing delays. It remains mostly free of vessels sitting at anchorage, however. At LA-LB, container lines are also struggling to find space with holiday orders congesting the port. Terminal operators at the ports say they can only accept ad hoc calls, not regularly weekly services. The number of container ships at LA-LB is nearly 5 times more than pre-COVID levels, and these capacity constraints are expected to continue until the first half of 2022.

Drayage boycott increases congestion at Port Miami terminal. At least half the drayage providers at Port Miami terminal are refusing or limiting the pickup of import boxes at one of the port’s three container terminals because of delays facing drivers. These delays come from high volumes hitting the South Florida Container Terminal.

Air

COVID causes more cancelled cargo flights at Shanghai’s airport. After the detection of more COVID cases at Shanghai Pudong International Airport, many freight forwarders are not accepting bookings for Shanghai and are diverting flights to other airports. China’s zero-tolerance policy over COVID means that these closures of airports will be likely as the pandemic continues.   

Air freight rates continue to soar and cause a ‘super peak’ after Shanghai’s terminal closes. Due to the closure at Shanghai’s airport, ground operation issues, and cancelled flights, prices have been rapidly rising by around 30%, the highest rates 2021 has seen. This outbreak is expected to bring a ‘super peak’ that was expected in October to now, with rates double than they were a year ago and the highest they’ve been since May of 2020. 

Trucking 

Hurricane Ida disrupts trucking capacity. As peak season occurs, shippers far from New Orleans will begin to feel disruptions in the aftermath of Hurricane Ida. Trucks are diverted to hauling relief and rebuilding supplies to the areas affected by the hurricane, so delays will occur across the Southeast. 

The Federal Motor Safety Commission Association (FMSCA) extends pandemic-related HOS waiver. The FMSCA has extended the pandemic-related HOS waiver until November 30. Read this article from FreightWaves to view the specifics of the extension. 

Rail

CSX restricts domestic container flows in Chicago. CSX Transportation has restricted the number of containers it will accept in Chicago as it struggles with heightened demand. This restriction comes amid a disruption to Norfolk Southern’s intermodal network. 

Railroads try metering to ease congestion at inland terminals. As rail ramps in Chicago, Memphis, Kansas City, and the Ohio Valley see unprecedented congestion, railroads are stacking containers at the Ports of Los Angeles and Long Beach, hoping that a more even flow of imports will help make congestion more manageable. Through restricting inland point intermodal (IPI) bookings to Detroit, Indianapolis, and Louisville, and urging importers to convert loads into port-to-port moves in Southern California, railroads hope that this will foster a more even cargo flow to inland terminals. 

Other

Viewpoint from FreightWaves: Global supply chains reaching a “critical moment in time.” Read this viewpoint from FreightWaves explaining why global supply chains are reaching a critical moment in time as the COVID-19 Delta variant continues to spread, container prices skyrocket, and negative impacts on human capital in supply chains occur.