Key Takeaways
US PORT STRIKE – EAST COAST AND GULF COAST CONTAINER TERMINALS ARE CLOSED.
East Coast and Gulf Coast dockworker’s contract expired Sept 30.
Work stopped at 12:01am on October 1st and began picketing container terminals.
From bananas and chocolate to clothing and footwear, this strike will affect imports and exports across all sectors.
Container costs are up 2x over this time last year.
Rates have come down from their high point earlier in the summer.
They will likely stay around their current levels for several months.
The port strike will affect rates and reliability as importers scramble to utilize the west coast ports.
Ocean vessel schedule reliability is hovering around 55%.
Container availability is an issue at some ports.
For US imports expect minimal delays on average 1-3 days.
Booking delays in Asia could be as high as 3 weeks.
Container Logistics
Rising Container Costs
Starting in May and continuing into October container rates increased, through in recent weeks have pulled back from yearly highs.
40’ containers coming to the USA are now $8,000 - $10,000, with east coast arrivals being on the higher end.
Factors causing this increase:
Carriers canceling planned vessels, to ensure each boat that is moving is full. Leading to shippers fighting for the available space.
Vessel backups and delays in Singapore are causing a ripple across global ocean logistics.
Container availability issues are occurring. This is mostly due to the longer transit times boats have been facing for 8+ months.
Additionally, vessels being out of position due to longer transit times / delays.
Shippers are moving up their peak season shipments, which is worsening the current market conditions.
Imports to the US are up 12% year over year.
Panama Canal Congestion
Due to water savings measures and earlier rainfall this spring the canal is operating at near normal capacity now.
While it is possible to see unexpected delays, at this time transport of containers through the canal is stable.
Suez Canal and the Red Sea
Starting in November 2023 and continuing into October most long-range steamship lines avoiding this area. Local traffic is continuing to use the canal.
Overall volume through the canal is down over 50% compared to this time last year.
Vessels inbound to the USA are continuing to route around Africa (Cape of Good Hope), which increases transit time by roughly a week.
US Port and Overland Overview
Fuel Updates
Ocean Fuel (VLSFO) as of October 2024 is flat over the year
Compared to 2021 and prior the cost is still up 50% +
Diesel in the USA as the start of October is $3.54 a gallon
Diesel is still roughly 20% higher than 2019 levels, which is keeping freight prices elevated.
Additionally, average diesel prices reported by EIA.gov are typically lower than truck stop prices, and are average across large sections of the country.
National FTL rates are steady throughout 2024, though elevated from 2019 levels.
LTL and small package rates have continued to rise, due to the nature of how those networks function.
Data Analysis
August container imports were strong, though not record setting. They stayed above the 2.4m TEU level, which is seen as the high limit for what the US Container Logistics Industry can handle without many issues.
West coast port share continues to outpace the east coast. A clear sign of shippers avoiding the east coast prior to the strike.
The PDF below is port-by-port review across the U.S. in October 2024 compared to 2023 & 2022.
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