27/4/2021

Dear all Valued Customers

 

Asia-US Gulf Coast Imports Grow; BRi USA Market Update

 

Ports along the US Gulf Coast expect to build on last year’s gains in containerized imports from Asia with a new all-water service coming in the second quarter, according to local port officials.

 

The new service will commence amid an ongoing boom in regional import distribution capacity, but Gulf Coast ports are also eyeing opportunities to capture cargo headed to inland areas by increasing their intermodal reach. Gulf Coast ports handled 5.4 percent of total US imports from Asia in 2020, up from 5 percent in 2019.

 

As Gulf Coast imports continue to grow, it will be important for Port Houston to offer shippers rail options into the Midwest to keep up the growth in Asian imports. Although that lane is well served by trucking, the Port Authority aims to attract shipper and railroad interest in bringing intermodal rail back to Houston's Barbours Cut Terminal. In addition, New Orleans can also serve as an alternative to Houston for bringing Asian goods to the Dallas inland market through the port’s on-dock rail provider Kansas City Southern Railway.

 

Also growing, the Alabama State Port Authority said the Port of Mobile has seen growth in Asian imports continue to accelerate in early 2021. After rising 5 percent for the full year in 2020, Asian imports through Mobile jumped more than 15 percent year over year in the first quarter.

 

With the addition of new routings, premium rates, and lengthened vessel wait times, this unprecedented time of demand has urged shippers to re-evaluate their supply chain needs. As such, BRi USA has compiled market updates on the everchanging global supply chain:

 

Ocean

 

• General conditions indicate that space is fully booked until end of May.
• The new East Coast 6 (EC6) string, THE Alliance’s first in the Asia–US Gulf trade, will have a full port rotation of Kaohsiung, Hong Kong, Yantian, Ningbo, Shanghai, Busan, Houston, Mobile, New Orleans, and back to Kaohsiung. The new weekly service will initially be operated with vessels of 6,700 TEU capacity, but vessels could be boosted to 8,500 TEU in the coming months depending on demand. The service begins in May, and we’ve been told that the service is already sold out in the first month.
• Zim has added new services under ZEX, ZX2 and ZX3, bringing additional US import capacity from Southeast Asia to Tacoma, Los Angeles and Oakland. 

 

Equipment

 

• Unstable schedule and serious equipment shortages forced carriers to implement more blank sailings in April. The window for securing equipment in April has been closed, and even for some carriers through mid-May, especially for USEC.
• All shipping lines are in tight supply of 40HQ at this moment.  

 

Air

 

• Capacity out of Asia and Europe is tight, most freighters are completely booked, some through May.
• Most recently, airlines are contending with new travel bans and restrictions arising from outbreaks in large aviation markets such as India and Brazil. Governments of countries that have ramped up vaccinations most quickly have become cautious about restarting travel to prevent the import of new variants that could prove resistant to jabs.
• Rates are rising again due to tight capacity. Some carriers are updating their rates daily.
• Carriers are booking space 10-14 days in advance in some cases for US imports.
• We are seeing delays at the airports when tendering the cargo for exports, and the airlines will not hold cargo until the flight schedule departure date.
• Several airlines are moving shipments on more expensive Express Services only.
• American Airlines has announced the addition of 100 more Domestic flights in May. These routes will utilize widebody aircraft, offering more cargo capacity for the Domestic airfreight network.

 

Domestic Trucking

 

• Truck capacity is tight, especially with intermodal moves as many truckers are preferring to carry over-the-road loads currently.
• Rates are primarily a spot quote market due to fuel being higher and a lack of stability. Adding to the volatility, the volume of freight moving has made the demand even higher.
• Most domestic loads are booked a week in advance; however, we are specifically seeing a lot of intermodal and dray moves booked 3-4 weeks in advance.
• General conditions across all major inland ramps is that trucking capacity and chassis availability remains very tight. Some ramps such as Kansas City and Toronto are limiting gates due to congestion.
• Truck power is very tight for Atlanta and Memphis. Additionally, Nashville truckers have been assisting with Memphis freight, so truck capacity is tightening in the Nashville area.

 

The BRi USA team is monitoring the global situation carefully and will provide updates as they are made available.

 

Port of Montreal Unions Give Strike Notice

 

The Longshoremen’s union has given 72 hour notice to the Maritime Employers Association that as of April 26 at 7:00 a.m. the union will be in a legal strike position, and all work performed by the union members at the Port of Montreal will cease.

 

BRi USA will provide updates to this situation as they become available.

 

After First Quarter Freeze, US Trucking Market Heats Up

 

Frigid first-quarter temperatures may have reduced US shipment volumes, but they did not temper freight demand. US truckload carriers are riding cold first-quarter tailwinds toward a hot spring peak trucking season with “unprecedented levels” of demand that some believe could continue into 2022.

 

February’s winter storms and weeks of subfreezing temperatures in the southern and central United States had a large and lingering impact on transportation and supply chains. Nonetheless, lower first quarter shipment volumes reflected the physical impact of storms, not the actual level of freight demand, which remained high, with shipments postponed. Read more at JOC.

 

Stalled Spot Rates on Asia Trades add Complexity to Contract Talks

 

Rates on Asia-Europe and the trans-Pacific have been relatively stable, albeit at extremely high levels, for the past few months, which could have implications for shippers signing long-term contracts.

 

Containerships Wanted: Carriers Seeking Tonnage

 

Carriers are “scraping the bottom of the barrel” for available tonnage, as the percentage of the global containership fleet commercially idle and not in dry dock has fallen to just 0.8%.

 

According to Alphaliner only 56 container vessels (for a capacity of 205,000 teu) are listed as inactive, which it said were mainly ships that had been involved in accidents, affected by sanctions, or were waiting to join new charters.

 

As strong cargo demand and high freight rates continue, carries are keen to use all available tonnage for revenue-generating services or for empty box repositioning.

 

BRi ERP and Order Management Program – track your product/shipments anytime and anywhere

 

To ensure you maintain visibility to your shipments as they move through the supply chain, please take advantage of BRi PATHWAY.

 

The information in PATHWAY is real-time and available 24/7.

 

To obtain a login for your account, please respond to this email so we can get you started!

 

As a valued customer, we hope that you will continue to trust us to source the best options for your supply chain needs now and into the future. Should you have any questions, please do not hesitate to contact your Customer Solutions Representative.

 

Keeping you updated,

BRi Customer Solutions Team

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