COVID-19 Latest Updates

USTR Extends Section 301 Tariffs, Container Backlog at Port of NY-NJ, and Air Rates Increase Again

By March 11, 2021 No Comments

Ocean  

Ocean capacity is still tight, but rates are plateauing. Capacity with ocean container availability is still strained, but space is easier to find than what it was before Chinese New Year. Ocean freight rates have also been stabilizing. 

More ocean carriers are suspending services to certain inland ramps via Los Angeles/Long Beach. The ramps include Cincinnati/Cleveland/Columbus, Detroit, Louisville, Houston/San Antonio, Atlanta, Nashville, and New Orleans. The suspension comes as carriers prefer to accept more base port cargo to speed up the equipment utilization as no rail network connects from the West Coast to the East Coast. 

Container shortage from India poses challenges to outbound shipments. The Federation of India Export Organization (FIEO) has stated that an increase in ocean freight and lack of containers are making deliveries difficult. The FIEO attributes this shortage to low import volumes from China. Additionally, poor global container circulation further fuels this problem, while shipping lines prioritize the containers they have to ship on the U.S. trade line due to record high U.S.-China market trade rates.

Customs  

U.S. Trade Representative (USTR) extends Section 301 tariff exclusions to combat COVID-19 until September 30th. Section 301 tariffs on certain imports from China will be extended to support the country’s ongoing efforts to mitigate the COVID-19 pandemic. More details on the extension can be found in a document from the USTR online

The Biden Administration reviews current trade policies. As part of the Biden-Harris trade plan, the Biden Administration will be performing a comprehensive review of various trade policies to analyze their impacts on “and unintended consequences” for workers. More information on the trade plan can be found on a fact sheet online

Ports 

Container backlog at Port of New York-New Jersey increases dray rates for shippers. The demand from shippers looking to clear the container backlog at the Port of New York-New Jersey is straining drayage capacity, which is also increasing spot rates for hauling containers to regional distribution centers. 

Air

Air rates start to increase again. Despite the recent decline in air rates, they are now increasing again, although, not at as high as they once were. Additionally, congestion is getting worse at main airway hubs across the country to the point where terminals can no longer operate efficiently. This congestion is in part due to COVID-19 affecting workers, a shortage of truckers available at the airports, and freight not moving on a first-in-first-out basis. If you have any questions, don’t hesitate to reach out to one of our experts

Trucking 

High impact snowstorms expected to hit the Rockies and Plains. A strong winter storm is expected to move from the Rockies to the Plains later this week with an anticipated 6-15 inches of snow in some areas. Besides poor visibility, strong winds, and bad road conditions, power outages are also expected. This winter storm will impact both air freight and truckers, so delays in shipments are likely.

Rail

Union Pacific assesses a container surcharge in California. UP has signaled that it’s experiencing capacity constraints in Southern California, implementing a $250 container surcharge on excess loads for low-volume shippers. The railroad will raise the threshold for what categorizes as a high-volume shipper as well. The surcharge will be implemented starting March 21st and will cover all of California.  

Other

It’s Women’s History Month. This month, we’re celebrating women figures who transformed the supply chain and transportation industry. Our Women’s History Month blog highlights women supply chain leaders who made the industry move forward, faster. 

Intermodal congestion in Dallas could last weeks longer due to the February winter storm. Chassis equipment providers are warning importers that it could take several more weeks to receive their containers and before cargo flow returns to normal at Dallas-Fort Worth rail ramps, citing the February winter storm as the cause. The storm, complete with ice, snow, freezing temperatures, and power outages, closed rail terminals and distribution centers in the Midwest and the South. This weather caused containers to pile up in Southern California, which is the top origin of marine cargo in Texas.