Maritime

May 4: Top Sea Polluters Beg for Climate Rules that No Rival Can Avoid – American Journal of Transportation

The ocean shipping industry, among the world’s biggest polluters, is asking a key regulator to overhaul its emissions directives so that all carriers are working off the same rulebook as they make the expensive changes needed to cut output of harmful carbons.

With roughly 90% of global trade transported by sea, the industry emits more carbon annually than Germany and the Netherlands combined. And if shipping were a country, it would be the world’s sixth-biggest greenhouse-gas emitter, according to the World Economic Forum.

The World Shipping Council, whose members operate 90% of global container-carrying capacity, want the International Maritime Organization to revisit its greenhouse-gas-emission regulations.

The WSC, whose members include A.P. Moller-Maersk A/S, Cosco Shipping Holdings Co. and MSC Mediterranean Shipping Co., is asking for “global, enforcible multilateral regulation to avoid the race to the bottom,” said Jan Hoffmann, head of trade logistics at the UN Conference on Trade and Development. “They don’t really mind that level of regulation as long as it’s the same for everybody.”

May 6: New Monitoring Requirements Give FMC More Insight into Alliance Carrier Operations – Splash

The three global ocean carrier alliances – 2M, Ocean and THE – and each of their member companies will now be required to provide enhanced pricing and capacity information, providing the U.S. Federal Maritime Commission (FMC) with uniform data to use in assessing ocean carrier behaviour and marketplace competitiveness.

The newly mandated information will provide the commission’s Bureau of Trade Analysis with insight into pricing of individual trade lanes and by container and service type. It will also provide more immediate information regarding the capacity-management decisions of ocean carriers and the alliances.

May 6: Container Shortage Forecast in Europe – WorldCargo News

Europe is facing container shortages as a result of two macro-level disruptions, the lockdowns in China and the Russia-Ukraine war, reports Container xChange.

Hamburg-based Container xChange reports that, while the shortage of containers is persistent, port throughput has also decreased.

“The ports of Antwerp and Rotterdam handled a lower volume of containers in the first quarter of 2022 as compared to the same period last year. The containers meant for the ports in Europe are now piling up at the ports in China (due to the lockdowns), potentially causing greater chaos in the coming weeks or even months,” said Christian Roeloffs, CEO of Container xChange. “If the lockdowns persist, the throughput volumes will be further impacted in the coming months for these ports in Europe.”

May 10: Carriers Blank More Sailings as China’s COVID Lockdowns Continue – gCaptain

Ocean carrier alliances are preparing to blank more than a third of their sailings from Asia over the coming weeks in response to a reduction in export freight, according to the latest report from Project44.

The blanking strategies by the alliances to mitigate the impact of the COVID lockdowns in China will further extend cargo lead times, particularly to North Europe.

The supply chain platform’s data shows that between weeks 17 to 23, THE Alliance will blank 33% of its scheduled sailings from Asia, the Ocean Alliance will void 37%, while the 2M alliance will cancel 39% of its headhaul voyages.

May 17: Global Container Shipping the Worst for 50 Years Reports Drewry – Automotive Logistics

A continuous deterioration in the accuracy of transit and arrival times in global container shipping means the sector is in the worst state it has been in for 50 years, according to Drewry Shipping Consultants.

The situation is not expected to start improving until the first half of 2023 and that is having an impact on the automotive industry at a time of wider supply chain uncertainty.

May 19: FMC Receives Fact Finding 29 Final Recommendations and Intermodal Equipment Report – FMC news item

U.S. FMC Commissioner Rebecca Dye presented her final report of Fact Finding 29, “International Ocean Transportation Supply Chain Engagement,” a two-year investigation she is bringing to conclusion. Commissioner Dye said she identified two major concerns of importers and exporters: the high cost of shipping cargo, and excessive demurrage and detention charges.

Based on her work, Commissioner Dye concluded that, though high by historical standards, freight rates reflected market forces of supply and demand in a supply chain challenged by the COVID-19 pandemic and an unprecedented surge in consumer demand. As to detention and demurrage, Commissioner Dye highlighted the Interpretive Rule of the Commission and how it is being enforced to address unreasonable detention and demurrage practices.

To help address these, and other identified issues, Commissioner Dye unveiled 12 new recommendations for the Commission to consider.

May 23: Single Window for Ship Data Exchange to Become Mandatory – IMO news item

The International Maritime Organization’s (IMO) Facilitation Committee has adopted amendments to the Facilitation Convention that will make the single window for data exchange mandatory in ports around the world, marking a significant step in the acceleration of digitalization in shipping.

The Facilitation Convention was adopted in 1965 and contains standards and recommended practices and rules for simplifying formalities, documentary requirements and procedures on ships’ arrival, stay and departure. The Convention has been updated continuously, embracing digitalization and automation for procedures.

The amendments adopted at the Facilitation Committee session are expected to enter into force on January 1, 2024.

May 25: Government of Canada Invests in Two Projects to Increase the Supply Chain Efficiency for Canadian Shippers in New Brunswick – Port Saint John press release

The Government of Canada will invest more than $42 million for two new projects under the National Trade Corridors Fund. These projects will help improve supply chain efficiency for Canadian shippers in Saint John and McAdam, New Brunswick.

The Government of Canada will contribute:

May 27: Shanghai Reports Increased Throughput as Lockdowns Ease – The Maritime Executive

Container operations at the port of Shanghai are on the rebound. While many districts in the city continue to have reduced restrictions, Chinese officials are reporting that the port has nearly returned to productivity levels before the lockdowns that began at the end of March. The major shipping lines are similarly reporting levels of progress, expecting that further restrictions will be relaxed by the end of the current month.

Chinese officials highlighted that throughput at Shanghai has rebounded, they said, to 95 percent of normal and the level of activity before the lockdowns. This compares with April, when they reported volumes were down to around 100,000 TEU dally, a decrease by at least 35 percent from normal capacity. Many private estimates put the figure lower, at close to 50 percent of normal capacity.

They are now also reporting that trucking volumes have rebounded to approximately 90 percent of capacity. However, many of the firms operating in the port continue to report a lack of trucking capacity. The health restrictions requiring truckers to have negative test results and limiting their entry into the port area if they have been in infected zones remain in place.

May 27: ‘Bullwhip’ Ready to Crack, as Spot Rates Get a Boost and Shanghai Reopens – The Loadstar

With Shanghai on the cusp of unlocking its manufacturing and unshackling frustrated container exports, spot rates from Asia are set to increase in the coming weeks.

However, the rate spikes could be short lived if some reports of cancelled orders prove to be linked to weakening consumer demand in Europe and the U.S.

May 28: Ships Divert to India as Sri Lanka Crisis Slows Colombo Port – gCaptain

Sri Lanka’s political turmoil is prompting some shipping lines to detour to Indian ports instead of calling at Colombo, one of the key supply chain hubs in Asia.

Political protests and a lack of fuel have slowed the number of trucks available to transport containers of textiles and other goods between Colombo’s terminals and supply chains, according to freight forwarders and analysts. That’s created a growing backlog of boxes at the port that shipping companies want to avoid, they said.

May 31: Long-Term Contracted Ocean Freight Rates Set ‘Staggering’ New Records – Splash

All bets are off – liner shipping will now make improved profits over 2021’s record earnings, even in the unlikely event that there is seismic crash in spot earnings in the remaining seven months of the year.

May saw the highest monthly increase in long-term contracted ocean freight rates since Oslo-based Xeneta started tracking these shipments, as the cost of locking in container shipments soared by 30.1%. The unprecedented hike, revealed in the latest Xeneta Shipping Index (XSI) public indices for the contract market, means that long-term rates are now 150.6% up year on year. In 2022 alone, costs have climbed by 55%.

“This is a staggering development,” commented Xeneta CEO Patrik Berglund. “Just last month we were looking at an 11% rise and questioning how such continued gains were possible. Now we see a monthly increase of almost a third blowing the previous XSI records out the water.”

 

 

Air

May 4: Airport Congestion Masks Softening in Trans-Atlantic Air Cargo – American Shipper

The cargo holds of aircraft flying between Europe and North America are less full than a month ago as the number of passenger flights swells and shipping demand softens, but supply chain friction and high jet fuel prices are artificially propping up freight rates in a declining market, according to logistics experts.

Cargo owners could enjoy considerable pricing relief in the months ahead if airport constraints get better, said Niall van de Wouw, co-founder and managing director of analytics firm Clive Data Services.

Clive’s analysis shows the dynamic load factor, which essentially measures aircraft capacity utilization as a function of both volume and weight, has fallen below 80% for the first time in two years. Total air cargo capacity increased by 15% in the last week of March from the previous week as airlines step up summer schedules to meet pent-up travel demand following the COVID crisis.

May 5: Airfreight Rates Soften as Bellies Bounce Back on the Atlantic – The Loadstar

The start of May has seen a softening of the air freight market – with customers on long-term contracts paying more than the spot rate, as belly bounces back.

For the first time post-pandemic, since the end of March, capacity over the transatlantic is higher than pre-pandemic levels.

This extra capacity has led to the lowest dynamic load factors since the first half of January on western Europe to North America.

Other tradelanes have seen higher load factors, driven by constrained capacity rather than high demand.

May 18: Air France-KLM and CMA CGM Sign Strategic Partnership in Global Air Cargo – Cargo Trends

Air France-KLM Group and the CMA CGM Group announced that they have signed a long-term strategic partnership in the air cargo market. This partnership will see both parties combine their complementary cargo networks, full freighter capacity and dedicated services.

The agreement will have an initial duration of 10 years. Air France-KLM and CMA CGM will join and exclusively operate the full-freighter aircraft capacity of the respective airlines consisting initially of a fleet of 10 full-freighter aircraft, and an additional combined 12 aircraft on order.

 

 

Rail

May 30: Access Upgrades Complete from Burnaby Rail Corridor to North Shore Port Terminals – Burnaby Now

Improvements to the Burnaby rail corridor to better access the North Shore port terminals are completed.

CN, the Vancouver Fraser Port Authority and the City of Burnaby say the finished upgrades have cut commutes in half for trains waiting in Burnaby for the tunnel to vent.

Roughly 65 percent of rail traffic through Burnaby goes to the North Shore, and the improvements will result in more trains per hour delivering export goods to port terminals and will reduce idling.

May 31: Canadian Pacific Announces Multi-Year Agreement with CMA CGM – CP press release

Canadian Pacific has announced a new multi-year agreement with CMA CGM Group. CP will become CMA CGM’s primary rail provider in Canada, servicing the ports of Vancouver, Montreal and Saint John.

 

 

Trucking

May 2: Canada Further Delays GHG Standards for Trailers – Today’s Trucking

Canada’s federal government is once again delaying plans to apply greenhouse gas emissions (GHG) standards to trailers, in the face of challenges to companion rules in the U.S.

The fourth interim order on the subject will suspend the standards by up to one additional year, said Stephane Couroux, director of the transportation division at Environment and Climate Change Canada’s Environmental Protection Branch.

“During the period that the fourth interim order will be in effect, the department will undertake further consultations with key stakeholders, continue to monitor the situation closely in the U.S. following the Court of Appeals decision to rescind the trailer standards established by the U.S. EPA and NHTSA, and continue to assess the impacts for Canada,” Couroux said in a related notice.

“This will help inform the path forward on whether to amend or implement the trailer standards in Canada for model year 2023.”

May 3: Shippers Turn to Trucking for Help Meeting Carbon Reduction Goals – Transport Topics

As large corporations make bold pledges to achieve carbon neutrality in the coming decades, they are increasingly looking at their supply chains as an opportunity to make progress toward those goals.

In addition to asking motor carriers the usual questions about reliable service, safety and pricing, many large shippers are raising the issue of environmental sustainability and carbon emission reductions, said Matt McLelland, vice president of sustainability at Covenant Logistics.

Trucking companies must be aware of this shift and should begin preparing for it, he said.

Freight transportation emissions will become an increasingly important focal point for large corporations that are targeting carbon neutrality by 2050 or even 2040.

“Every molecule of carbon that your truck puts out belongs to their carbon footprint,” McLelland said.

May 12: Trucking Continues to See Robust M&A Market – Transport Topics

Trucking and logistics continue to see strong merger and acquisition activity, a trend that goes back more than a year

The deal market has stayed active amid a confluence of factors that are motivating buyers and sellers. They include high valuations for motor carriers and expectations interest rates are poised to rise.

The Tenney Group CEO Spencer Tenney noted sellers are motivated because the high valuations may normalize down the line. That includes equipment costs, which have been favourable for valuing businesses in the current market because of shortages. Buyers are also motivated to get deals done now because of interest rates.

May 13: Freight Volumes Down as Chances of Freight Recession Rise – Commercial Carrier Journal

U.S. freight volumes fell in April from March and the year-ago period, according to the Cass Transportation Index April 2022 report. With more difficult comparisons in the next few months as global supply chain disruptions are set to intensify, Cass predicts more softness is on the horizon.

The shipments component of the Cass Freight Index fell 0.5% year-over-year, following a 0.6% year-over-year increase in March. Shipments also fell 2.6% from March, which was 0.9% below the normal seasonal pattern.

Freight was slowing even before the war in Ukraine began, Cass noted, but the effects of the additional surge of inflation and recent interest rate increases have slowed freight even more.

May 22: A Major Cause of Inflation May Have Peaked; That’s Good News for Consumers but Bad News for Trucking Companies – FreightWaves

Note these statistics:

According to Bank of America’s biweekly survey of shippers, trucking freight rates are set for an even larger pullback. This is bad news for trucking companies but good news on the inflation front.

 

 

CIFFA Advocacy, Communications, Activities

May 30: CIFFA to Attend Hill Day in Ottawa

CIFFA’s Director of Policy and Communications Julia Kuzeljevich will be attending in-person Parliament Hill Days in Ottawa, on May 30 and 31.

This two-day event will feature a parliamentary reception in the evening on Monday, and a full day of dedicated meetings with parliamentarians and government officials on Tuesday.

The event was organized by the Canadian Chamber of Commerce for its Transportation and Infrastructure Committee members. CIFFA is a member of this committee, as well as the International Affairs Committee of the Chamber.

 

Maritime

April 6: ‘Outlandish’ Emissions Claims by Liner Giants Ridiculed on Social Media – The Loadstar

In a LinkedIn post, Lars Jensen, CEO of Vespucci Maritime, noted “wild discrepancies” between the emissions-per-box claims of alliance partners Evergreen, CMA CGM, Cosco and OOCL.

“If you book with any of these, the cargo will go on the exact same vessel on the exact same routing,” said Jensen.

However, claimed per-box emissions on a route between New York and Shanghai at CMA CGM varied between 1370 kg and 1779 kg of CO2, depending on the route taken; Evergreen claimed between 809 kg and 839 kg; OOCL claimed 692 kg; and, by far the most outlandish claim, was that by Cosco, of between 437 kg and 533 kg of CO2 depending on the service chosen.

“Four carriers. Four different methodologies. Four very different results,” said Jensen.

His observation has potentially troubling implications for shippers, for whom emissions data increasingly plays a role in their decision-making.

April 8: More Blank Sailings as Spot Rates Tumble and China’s Lockdowns Take Their Toll – The Loadstar

There is a distinct feeling of déjà vu about the current lockdowns in China, with spot rates declining as carriers scramble for export cargo from shuttered manufacturing.

But rates could spike again when the flood gates reopen for the delayed orders.

“It’s almost like a traffic jam,” said Container xChange CEO Christian Roeloffs. “Some people have now stepped on the brakes really heavily and this will lead to a significant build up in demand for freight services, which will be unleashed once the factories reopen.

“And when demand is back, carriers will again not have enough equipment on the ground, as not enough containers went into China during the lockdowns. So that will push up prices again,” he added.

April 11: Shanghai Port Runs Out of Space for Refrigerated Containers – American Shipper

Container vessel operators are preparing to divert refrigerated containers destined for Shanghai to other ports because the area to plug into electric power is full of cargo that trucks can’t retrieve in the face of a citywide COVID lockdown.

The notices to customers are the latest manifestation of how the strict restrictions on movement within the city are impacting imports and exports through the world’s largest container port and Pudong International Airport.

Authorities in Shanghai have sealed off the entire city for nearly two weeks. Over the weekend a record 23,000 COVID cases per day were counted. More than 90% of trucks supporting import and export deliveries are out of action because of the restrictions. The slow pickup of cargo has resulted in long container dwell times, leaving less room to place arriving import boxes. Decreased terminal efficiency is forcing dozens of container vessels to wait at anchor for berth space, while others skip the port altogether.

April 11: Part of Felixstowe Terminal Collapses – Container News

Part of terminal 6 at the Port of Felixstowe, the United Kingdom’s busiest container port, collapsed on April 10.

Port operations are expected to face a period of disruption.

April 13: Floods Knock Out South Africa’s Largest Port – Splash

Torrential rain – the worst experienced in more than six decades – has knocked out operations at South Africa’s largest port, Durban.

Some parts of KwaZulu-Natal province recorded as much as 300 mm of rain within 24 hours earlier this week with many deaths reported and severe damage to road and rail links.

An update from Danish carrier Maersk stated that depot and warehouse operations have been suspended, and there is no access to the Durban terminal because of “significant damage” to an access road.

April 16: Maersk Stops Bookings of Meat and Fish into Shanghai – gCaptain

AP Moller-Maersk A/S has stopped bookings to ship refrigerated containers into Shanghai as a strict COVID lockdown stalls the trucking of meat and seafood from the port into the city.

Containers are piling up at the port of Shanghai due to supply chain disruptions caused by the lockdown, Ocean Network Express said in an advisory to customers on April 14. The port is running out of electric plug slots to keep refrigerated containers cool, while trucking remains limited and terminals are congested, the container shipping line said.

That has prompted Maersk to stop all new deliveries of refrigerated goods and some hazardous cargoes into Shanghai until further notice, the company said. The company is waiving charges for customers to change the destination of their frozen goods already sailing to Shanghai.

April 19: Durban Port Functional after Flood Devastation – MarineLink

South Africa’s major port of Durban, where operations were disrupted by severe flooding last week, is now functional and a backlog of thousands of containers will be cleared within five to six days, the public enterprises minister said on April 19.

The floods caused extensive damage to roads leading to Durban port, one of the busiest shipping terminals in Africa and a key hub for exports.

April 20: 1 in 5 Containerships Globally Are Stuck Waiting Outside Congested Ports – gCaptain

The number of containerships waiting outside of congested ports has risen sharply in recent months, with 20% of all containerships trading globally now stuck in backups, according to maritime data intelligence firm Windward.

Widespread COVID-19 lockdowns in China have heavily impacted congestion outside the country’s ports, with the number of waiting ships nearly doubling since lockdowns first went into place – climbing from 206 in February to 506 in April.

Looking at the global picture, between April 12 and 13, there were 1,826 containerships waiting outside of ports around the world, representing approximately 20% of the global fleet, Windward data shows.

April 20: Expedited Shipping Lanes Gain Momentum as Congestion Persists – Supply Chain Dive

Shippers are increasingly using expedited shipping lanes to mitigate supply chain disruptions at ports, several executives confirmed in emails with Supply Chain Dive.

Hapag-Lloyd said in a statement the ocean carrier is trying to meet “a trend to faster services.”

Sovos Brands CFO Chris Hall recently touted the strategy to investors. “We have and will continue to pay for accelerated lanes,” Hall said.

April 22: Carriers Roll Out More Blank Sailings in a Bid to Underpin Slide in Spot Rates – The Loadstar

The 2M alliance is preparing to blank three Asia-North Europe sailings next month, as export demand from China plummets and container spot rates come under increased pressure.

2M partners MSC and Maersk have cancelled their Griffin/AE55 loop for the first week of May and will void two voyages of their key Shogun/AE1 service in the following weeks.

MSC attributed the cancelled headhaul voyages to “the ongoing market situation” and said bookings would be accommodated on “alternative services.”

The blankings by the 2M and two other alliances are seen as a bid to halt the slide in rates as cargo bookings from China have tanked, due to COVID lockdowns and intermodal restrictions.

April 25: Hapag-Lloyd Fined by FMC after Levying ‘Wilful’ and ‘Erroneous’ D&D Charges – The Loadstar

German carrier Hapag-Lloyd has been ordered to pay $822,220 in civil penalties for 14 violations of the U.S. Shipping Act.

An FMC investigation found it incorrectly applied detention and demurrage (D&D) charges to 11 containers handled by California drayage firm Golden State Logistics (GSL).

The D&D charges levied to GSL amounted to $10,135, but the FMC’s Bureau of Enforcement (BOE), which Hapag-Lloyd had unsuccessfully claimed had no jurisdiction over the case, said the penalties were punitive in nature as the carrier had “knowingly and wilfully” applied the D&D charges despite GSL being unable to return the containers.

April 26: Vancouver Fraser Port Authority Postpones Gateway Infrastructure Fee 2022

The period for accepting submissions on GIF2022 ended on April 15. To allow sufficient time to review and address concerns raised by stakeholders, the VFPA has postponed implementation of the fee.

Details respecting the timing of a new effective date for implementation of the proposed GIF2022 will be available in the near future.

April 26: Despite Rising Risks, Shipping Lines on Track for Another Record Year – American Shipper

The year is almost a third over, and with each passing month, shipping lines look increasingly likely to pocket even more cash in 2022 than in record-trouncing 2021.

New data and commentary released on April 26 by ocean carrier Maersk, freight forwarder Kuehne+Nagel and consultancy Drewry highlight just how profitable this year is looking for ocean carriers – and how expensive it’s looking for importers.

 

 

Air

April 6: Hong Kong Banning Flights at Fastest Rate Since January – American Journal of Transportation

Less than a week after Hong Kong rolled back some of the world’s strictest inbound travel curbs, at least six airlines have had routes banned.

Singapore Airlines Ltd., Emirates, Cathay Pacific Airways Ltd., Qatar Airways QCSC, Korean Air Lines Co. and Malaysia Airlines were slapped with week-long bans this month after breaching Hong Kong’s so-called circuit-breaker mechanism. A stoppage can be meted out if three or more COVID-19 cases are found on the same flight, or if there’s one confirmed infection and another non-compliant passenger.

April 19: Cargo Diversions from Shanghai Start to Clog Up Other Major Chinese Airports – The Loadstar

Air freight diverted from lockdown-hit Shanghai Pudong Airport (PVG) is clogging up China’s other major airports, causing a shortage of pallets for exports.

Forwarders have singled out Zhengzhou Airport (CGO), in the central Henan province, as the hardest hit, given the large amount of cargo diverted there from Shanghai.

April 25: U.S. Airlines Substituting Buses for Planes as Pilot Shortage Persists – American Journal of Transportation

U.S. airlines are facing a pilot shortage that’s complicating efforts to ramp up flights, forcing them to step up training programs, recruit foreign pilots and even replace planes with buses.

The industry needs to hire an average of 14,500 new pilots each year until 2030, according to U.S. federal labour statistics. But carriers say there’s no way they can bring on that many due to long lag times for credentialing. Worse, experts say the staffing bottleneck is unlikely to end anytime soon.

“The pilot shortage for the industry is real and most airlines are simply not going to be able to realize their capacity plans because there simply aren’t enough pilots, at least not for the next five-plus years,” Scott Kirby, chief executive officer of United Airlines Holdings Inc. said this week.

April 25: Russian Takeover of Foreign-Owned Aircraft Portends Higher Lease Rates – American Shipper

Air Lease Corp. disclosed on April 22 it is writing off $802.4 million for leased aircraft trapped in Russia it doesn’t expect to recover following Western sanctions against the country for the invasion of Ukraine.

The broader significance of the impairment charge is that “lessors are going to treat country risk differently than they had in the past and will charge airlines accordingly,” Cowen equity analyst Helane Becker said in a client note. “We expect lease rates to trend higher.”

 

 

Rail

April 6: The Montreal Port Authority and Canadian National Reach an Agreement in Principle to Develop the Rail Component of the Port of Montreal’s Contrecœur Expansion – MPA press release

The Montreal Port Authority (MPA) and Canadian National Railway (CN) have reached an agreement to integrate rail transport at the MPA’s new container terminal in Contrecœur.

The CN rail line is already in place in the area covered by the Port of Montreal’s expansion in Contrecœur. In addition to establishing an efficient intermodal service, the partnership aims to ensure close cooperation between CN, the MPA and the private partner that will be selected to design, build, finance, operate and maintain the future terminal, following a procurement process led by the MPA.

April 28: New CEO Spells Out Priorities for Canadian National – Trains

New CEO Tracy Robinson likes what she sees at Canadian National.

Robinson spent her first two months at CN traveling the system and getting to know the operating team, as well as meeting with the railway’s customers and investors.

Robinson, who was an executive for eight years at Calgary-based pipeline company TC Energy following a 27-year career at Canadian Pacific, spelled out her priorities for CN during her first public comments as chief executive.

First, CN will run a scheduled railroad “with a laser focus on velocity,” which will improve service and produce more efficient use of assets such as locomotives, cars, and crews.

Second, Robinson says, “we will curate our book of business to better fit our network and leverage our strengths.”

Third, the railway will tighten coordination between operations and marketing to ensure the railway has the capacity to deliver on its commitments to customers.

And fourth, CN will continue to invest for growth and efficiency.

 

 

Trucking

April 6: Trucking Industry Will Be in Trouble if Demand Drops to Pre-COVID Levels – FreightWaves

Trucking spot rates are way up, but so are operating expenses. What does this mean for carriers?

Since the pandemic began, the number of dispatchable trucks in the for-hire trucking market (trucks with a driver and available to haul a load) is up approximately 10%. Since trucking rates are contingent upon the balance of supply and demand, if volumes were to drop back to pre-pandemic levels (with far more capacity in the market), rates would collapse.

But even more worrisome is that the operating expenses of carriers are at much higher levels than before COVID. FreightWaves estimates that operating expenses for nearly all carriers have surged by as much as $0.38 per mile over pre-COVID levels. This calculation includes only maintenance, insurance and fuel costs.

The calculation does not include driver wages or equipment purchase/finance, which could nearly double the increased amount of operating expenses.

If a trucking fleet were to start up today with an employee driver, its operating cash expenses would be as much as $0.72 per mile higher than a trucking fleet that was started in 2019.

April 9: Commercial Border Crossings in El Paso Slow to Snail’s Pace after Texas Steps Up Security – Reuters

Hundreds of commercial trucks waited in an hours-long line on April 9 to cross the border from the Mexican city of Ciudad Juarez into El Paso after Texas Governor Gregg Abbott ordered state troopers to step up inspections of north-bound vehicles.

The commercial border crossings between Ciudad Juarez and El Paso slowed to a snail’s pace after Abbott directed the Department of Public Safety on April 6 to begin conducting “enhanced safety inspections” of vehicles at the international ports of entry into Texas.

Abbott’s order cited “cartels that smuggle illicit contraband and people across our southern border” as the reason for the stepped-up measures.

April 12: Trucker Protests Expand at U.S.-Mexico Border over Lengthy Wait Times – Reuters

Mexican truck drivers blockaded bridges at the U.S. border for a second day on April 12 to protest an order by the Texas governor meant to increase safety inspections that has snarled traffic and led business groups to warn of supply chain disruptions.

Mexico’s government said in a statement it “rejects” the inspections imposed by Texas, estimating that two-thirds of normal trade was being held up and costing “significant revenue” for both U.S. and Mexican businesses.

April 15: Texas Moves to Ease Border Gridlock Over ‘Sense of Urgency’ – Transport Topics

The logjam of trucks at the U.S.-Mexico border finally began breaking April 14 after nearly a week as Texas Gov. Greg Abbott eased off his latest dramatic action over immigration that has gridlocked some of the world’s busiest trade ports and taken a mounting economic toll.

“There is a sense of urgency now to reach deals that did not exist before,” Abbott said.

The Republican governor, who for days has allowed commercial trucks to back up for miles into Mexico after requiring them to stop for additional inspections in Texas, lifted that order for bridges in El Paso and other cities after announcing a new security agreement with the neighbouring Mexican states of Chihuahua and Coahulia.

Inspection orders remain in other parts along Texas’ 1,200-mile border, including the busy Rio Grande Valley, but Mexican trade leaders were optimistic those would also end soon.

April 27: New StatsCan Data Highlights Demographic Crisis Underpinning Truck Driver Shortage – Canadian Trucking Alliance

Canada faces record retirements from an aging labour force at a time of record high job vacancies and historically low unemployment, reports Stats Canada.

No industry is feeling the complications of this demographic crisis more than the trucking industry, which, already in the midst of a severe labour shortage, has the oldest workforce in Canada, says the Canadian Trucking Alliance.

 

 

CIFFA Advocacy, Communications, Activities

April 12: CIFFA Participates in Ontario Ministry of Transportation Freight Advisory Committee

CIFFA participated in the Freight Advisory Committee that assisted the Ontario Ministry of Transportation in developing a transportation plan for the Greater Golden Horseshoe (GGH) over the past couple of years.

The province released Connecting the GGH: A Transportation Plan for the Greater Golden Horseshoe on March 10. The plan sets out a path forward for a regional transportation network to 2051 to meet the region’s transportation needs, and demands that will come with forecast population and employment growth.

The 2051 vision includes infrastructure, service improvements and policies organized under four inter-related themes:

April 20: Minister of Transport Response to CIFFA Letter on CP Rail Strike

On April 20, CIFFA received a response regarding a March 11 letter to the Transport Minister, among other ministers, regarding a possible work stoppage at CP Rail, and any implications on supply chain fluidity. In his response, the Minister of Transport, the Hon. Omar Alghabra, indicated that safety is his top priority. “This was true during the disruption of CP rail service and remains the case now. I can also assure you that the safe, timely and efficient movement of goods is of the utmost importance to the Government of Canada,” he said.

April 21: Alberta Minister of Agriculture Replies to CIFFA Letter Regarding Prospect of Rail Service Interruption at CP Rail

On March 4, CIFFA wrote to the Honourable Nate Horner, Alberta’s Minister of Agriculture, Forestry and Rural Economic Development, to express, on behalf of 20,000 employees working in the freight forwarding industry, alarm at the prospect of a rail service interruption at CP Rail.

Minister Horner replied on April 21. His email message included the following:

Thank you for your March 4, 2022 email regarding Canadian Pacific Railway (CP) labour action and the challenges this posed for supply chains. I share your concern for all businesses across Canada that depend on CP as part of the transportation supply chain network.

The implications of a CP work stoppage and the need to find an amicable solution between CP and the Teamsters Canada Rail Conference (TCRC) required an immediate solution. As you stated, a slowdown or stoppage of CP rail would negatively affect stressed supply chains and undermine the competitiveness of Canadian export industries that depend on CP to get their products to market.

The Premier and the Government of Alberta addressed the CP labour action with the federal government. We also worked with our provincial and territorial counterparts to impress upon the federal government the severe impact that a CP strike would have on our provincial economies and the transportation supply chains our local businesses depend on.

As you know, CP and TCRC have agreed to binding arbitration. The Premier and the Government of Alberta are pleased with this decision and welcomed the return of normal operations at CP. We are continuing to monitor the situation and at this time are not aware of any long-term impacts for Alberta.

April 25: Canada’s Supply Chains, Fragile at the Best of Times, Are Now Broken: House Transport Committee Hearing on the State of Canada’s Supply Chains, Including ‘Most Compelling’ Testimony from CIFFA – National Post

The House of Commons Transport Committee heard last week from witnesses on the state of Canada’s supply chains. The consensus among experts at the committee is that they are in a terrible state and contribute to rising costs for consumers.

The most compelling testimony came from the Canadian International Freight Forwarders Association’s Bruce Rodgers and Julia Kuzeljevich, whose members appear to be bearing the brunt of the capacity problems.

Kuzeljevich said that it takes 22 days for a ship to travel the 10,000 kilometres between Hong Kong and Vancouver, only to then have to wait an average of four weeks to find a berth, according to logistics company Maersk’s data. Yard congestion at the port is 120 percent, compared with an optimal level of 80 percent. The port’s own data confirm that things are backed up: Container import rail footage (a measure of the train backlog) was 407,953 feet on March 22, compared with around 100,000 feet in October last year.

There was a two-day strike by CP employees at the port in the days leading up to March 22, but Rodgers pointed out that Canada’s supply chains are fragile at the best of times “and broken when anything disrupts them. We have had a lot of significant disruptions over the past two years.”

The efficiency of the system is not helped by burdensome regulation. Rodgers said the Canada Border Services Agency made efforts to reduce inspection delays during the pandemic, but freight forwarders still face “nightmarish” challenges. He offered the example of one importer whose container was identified for CBSA inspection on Oct. 23. The one-day inspection took place on Dec. 2 and the container was released by customs on Jan. 4 – a 73-day process that cost the importer US$8,730.

April 26: CIFFA Joins UN Global Compact

On the recommendation of our Sustainability Committee, CIFFA applied to participate in the UN Global Compact, the world’s largest corporate sustainability initiative. CIFFA was accepted as a non-business signatory.

In applying to join, CIFFA committed to implement the Ten Principles of the UN Global Compact, participate in the activities of the initiative where feasible and submit a report every two years on engagement activities.

To fulfill our commitment to the UNGC, CIFFA will do what we can to internalize UNGC principles in our strategies, policies and operations. We will endeavour to provide information from the Compact to members to enable you to develop meaningful corporate sustainability goals and best practices. Depending on member interest, we will consider developing tools and resources for Canadian freight forwarders looking to up their sustainability initiatives; organizing workshops on relevant topics; and advocating to governments on key issues.

The UNGC website, www.unglobalcompact.org, offers a library of guidance documents and tools, as well as a link to Global Compact Network Canada, at www.globalcompact.ca, where you’ll find local resources, events and newsletters.

April 26: CIFFA Appears as Witness before House of Commons Standing Committee on Transport, Infrastructure and Communities

On April 25, CIFFA’s Bruce Rodgers and Julia Kuzeljevich appeared before the House of Commons Standing Committee on Transport, Infrastructure and Communities (TRAN).

Read CIFFA’s speaking notes.

CIFFA responded to committee questions related to the state of the supply chain in Canada, reasons for issues, labour and infrastructure concerns, and the need for a national supply chain strategy.

The full list of witnesses for the April 25 session is:

Maritime

March 1: Carriers Suspend Bookings to and from Russia

Hapag-Lloyd, ONE, Maersk – The Loadstar

CMA CGM – corporate news

MSC –customer advisory

March 1: Biden Takes on Ocean Shipping as FMC Sees Market Setting Rates – American Journal of Transportation

President Joe Biden is taking on the concentrated market power of ocean shipping companies, although officials at the agency overseeing the industry indicated they lack both the jurisdiction and, for now, any evidence of wrongdoing.

The White House said Biden will call on Congress at his State of the Union to address the immunity that shipping alliances have from antitrust scrutiny under current law. The Federal Maritime Commission will join with the Department of Justice in a new initiative announced on February 28, to push for competition in ocean freight transportation.

“Many shippers really want us to do something about the rapid inflation of rates and decline in reliability in the ocean freight system,” said FMC Chairman Daniel Maffei.

The FMC could take legal action against carriers “if the rapid inflation of rates is due to some kind of artificial limitation on the supply of cargo space,” Maffei said. “But even after we’ve increased the reporting requirements and deepened our analysis, so far we have found no evidence of anything like that that’s actionable and furthermore neither has the European Union or China.”

“We will continue to scrutinize and keep looking, but so far we’re seeing the opposite. We’re actually seeing that the carriers are adding capacity, and in fact increase number of ships, overall,” Maffei said.

March 1: Canada Bans All Russian Ships From its Ports and Waterways – The Maritime Executive

The government of Canada is banning Russian shipping from Canadian ports, adding to the growing list of penalties targeted at Russian commerce in response to the invasion of Ukraine.

In an announcement on March 1, three Canadian ministers announced that Russian-owned or registered ships and fishing vessels will be prohibited from entering Canada’s ports and internal waters. In keeping with UNCLOS’ provisions for freedom of navigation and innocent passage, the measure does not cover Canada’s territorial seas. The ban will take effect later in the week as part of a broader package of sanctions.

March 3: U.S. House Panels Open Price-Gouging Probe of Major Ocean Carriers – American Shipper

Two U.S. congressional oversight panels have opened an investigation of three major ocean carriers, alleging that their dramatic rate hikes charged to shippers may have fueled inflation.

Leaders of the Select Subcommittee on the Coronavirus Crisis and the Subcommittee on Economic and Consumer Policy – which operate under the House Committee on Oversight and Reform – sent letters on March 2 to the heads of Maersk, CMA CGM and Hapag-Lloyd requesting information about their container rate increases and reports over the past year of exorbitant fees and surcharges.

The carriers are among 10 foreign-owned container ship operators controlling nearly 85% of the world’s container capacity, the committees stated. Using this market power, the 10 carriers “appear to have raised shipping rates in 2021 far more than any increase in costs,” resulting in $150 billion in annual profits, or nine times greater than 2020.

“Affordable shipping rates are critical to ensuring that small and medium-sized business owners can continue to make a living and provide goods and services to consumers at reasonable prices,” wrote the committees’ chairmen, James Clyburn, D-S.C., and Raja Krishnamoorthi, D-Ill.

“We are deeply concerned that [Maersk, CMA CGM and Hapag-Lloyd] may have engaged in predatory business practices during the pandemic, making scores of essential goods needlessly expensive for consumers and small businesses.”

March 4: Maersk Update on Halifax Port Omissions – customer advisory

Maersk provided the following update on the multiple Halifax port omissions it has experienced since end of quarter 4, 2021:

The operational environment has been extremely challenging and has impacted vessel proforma schedules due to numerous reasons, including, but not limited to:

We understand that we had no vessel calling Halifax since Feb. 12 with the omission of Maersk Penang 204W/206E, EM Kea 207W/209E, our operations team is working collaboratively to reinstate the Halifax port call for Maersk Patras 205W/207E expected in Halifax March 13, 2022 to control the gap of service with an aim of minimum fortnightly calls to Halifax during the upcoming weeks.

March 7: Port of Halifax to Get New On-Site Container Examination Facility – Government of Canada press release

The Government of Canada and the Halifax Port Authority announced on March 7 their joint investment in a new container examination facility within the Port of Halifax. The new facility will replace the existing off-site facility, significantly reducing inspection turn-around times, reducing port congestion, and improving the efficiency, safety, security and operations for the Canada Border Services Agency.

The Government of Canada will invest $7 million in the project under the National Trade Corridors Fund and Halifax Port Authority will contribute $8 million.

March 7: CMA CGM to Provide Concessions to SMEs – The Loadstar

CMA CGM pledged some exclusive space on its vessels to small and medium-sized shippers.

CMA CGM Group chairman and CEO Rodolphe Saadé acknowledged that “persistent tensions on global logistics chains” had been “particularly challenging for SMEs.”

He said: “We have decided to allocate dedicated capacity onboard our vessels to SMEs in the markets where tensions are highest (Europe, North America) at a negotiated rate, usually only available with much larger volume commitments.”

CMA CGM also said it was extending its freeze on spot rate increases until June 30.

March 10: Crews Start Abandoning Ships in Ukraine – gCaptain

Some shipowners have begun to ask crew to abandon their ships stuck off the coast of Ukraine, as Russia’s invasion of its neighbour reached the end of its second week.

Ukraine’s ports closed on February 24, when Russian troops began their incursion. At least five out of 140 ships stuck in the country’s waters have been hit by explosions, killing a Bangladeshi seafarer.

As intense fighting and shelling continues across cities in Ukraine, ship owners are grappling with dwindling food supplies and the possibility of a protracted war, according to people with knowledge of ships in the area. That’s forcing some owners to ask their crew to abandon vessels, they said.

More than 1,000 seafarers are estimated to be on ships stranded in Ukraine, some with cargo still onboard. The vessels, which include tankers, bulkers, cargo ships and a container vessel, aren’t able to leave because there aren’t harbour pilots to guide them out amid danger from missiles and underwater mines.

March 14: Competing Proposals at Vancouver Port Raise Environmental Concerns – Inside Logistics

The plan to build a new shipping container terminal the size of nearly 144 football fields at Roberts Bank has sparked a rival proposal along with concerns for endangered orcas and the salmon they depend on.

A review panel has been tasked with examining an alternative proposal to increase capacity at the port by Global Container Terminals.

March 14: Container Rates Climb on China Lockdowns – gCaptain

The number of container ships waiting off Qingdao, one of China’s biggest ports, is continuing to rise as the country doubles down on its COVID Zero policy, adding more delays to a strained global supply chain.

About 72 vessels were spotted off Qingdao port in Shandong on March 14, almost double the amount at the end of February, according to shipping data compiled by Bloomberg. The increased delays there and in other parts of China are expected to push up freight rates.

March 18: With Spot Rates Falling, Carriers Blank More Sailings and Plan Surcharges – The Loadstar

Container spot rates continued their decline across most Chinese export routes, prompting ocean carriers to blank more sailings.

The Ningbo Containerized Freight Index (NCFI) on March 18 recorded falls on all but five of the 21 routes covered by its composite index, shedding a further 1.7%, to 3,613.9 points.

March 24: European and American Terminals Brace for Whiplash Effect from Latest China COVID Outages – Splash

Terminals in Europe and North America have been told to brace for another whiplash effect from delayed shipments out of southern China.

Kuehne+Nagel’s Global Disruption Indicator, which tallies the cumulative TEU waiting time in days based on container vessel capacity (e.g., a vessel with a 10,000-TEU capacity waiting 12 days equals 120,000 TEU waiting days (TWD)), shows the TWD at Hong Kong and Shenzhen, where COVID cases have hampered port productivity dramatically this month, at 1.5 million days as of March 23, versus around 500,000 days two months ago.

Otto Schact, executive vice president of sea logistics at Kuehne+Nagel, warned that these delayed vessels will cause problems at their destination ports in the coming weeks. “The increased TWD will have an effect on lead times, inventory,” Schact warned.

March 28: Shanghai Goes into Lockdown – Splash

On March 27, China announced Shanghai would enter a staggered lockdown, starting on March 28, marking the biggest city-wide lockdown in the People’s Republic since the COVID outbreak began more than two years ago.

For shipping, congestion at the port – already very high – is expected to increase in the coming days, while overseas, terminals in Europe and North America will have to brace for an even larger whiplash effect when the city regains normal productivity – and comes as global supply chains absorb the fallout from a seven-day lockdown in Shenzhen to the south earlier this month.

The authorities have decided to split Shanghai in half using the Huangpu River for the new two-part lockdown. Pudong, the eastern part of the city, is in lockdown from Monday through to Friday as mass testing gets underway, while the western area, Puxi, will lock down between April 1 and 5.

March 29: Maersk Warns Shanghai COVID Lockdown Will Increase Shipping Costs Further – gCaptain

Maersk said the Shanghai lockdown will severely hurt trucking services and increase transport costs, as China’s intensifying efforts to fight the spread of COVID-19 further rattle global supply chains.

While it has kept its airports and deepwater port open, the city has imposed stringent movement curbs, barring unapproved vehicles from streets and telling millions of people not to leave their homes.

“Trucking service in and out (of) Shanghai will be severely impacted by 30% due to a full lockdown on Shanghai’s Pudong and Puxi areas in turn until 5th April,” Maersk said in an advisory on March 28.

“Consequently, there will be longer delivery time and a possible rise in transport costs such as detour fee and highway fee.”

 

 

Air

March 1: Ukraine Crisis Creates Logistics Headaches for Air Cargo, Airlines – American Shipper

Airspace restrictions from the economic war between the West and Russia over the invasion of Ukraine is adding logistical complexity and cost for the air cargo sector and passenger airlines still coping with COVID-related ups and downs in business activity. The conflict is also driving up the price of fuel, which represents a quarter or more of airlines’ cost base.

The European Union, Canada, the United Kingdom, and Baltic and Nordic states in recent days have barred all Russian-owned, -registered and -controlled aircraft from overflights of their territories. Russia has responded, banning three dozen airlines from its airspace.

The new rules will require carriers to take more circuitous routes to avoid airspace around Russia, as well as Ukraine, Belarus and Moldova, to avoid the possibility of accidental missile strikes.

Routes over Russia between Asia and Europe are optimal for many airlines in terms of the shortest flying time and fuel consumption. Swinging north, or more likely, south through the Middle East and up into Southern Europe will be less efficient but can be done by many carriers without too much difficulty, according to air logistics professionals.

Some airlines are cancelling flights because of the additional transit times while they figure out how to adjust to the new circumstances.

March 4: Long Flights, Grounded Fleets: How the War in Ukraine Could Alter Heavy Airfreight Capacity – Supply Chain Dive

Airspace restrictions due to the war in Ukraine could further limit options for shippers looking to transport large cargo.

Canada, the U.S. and the European Union have closed their airspace to aircraft from Russia. These restrictions add further pressure to an already tight airfreight market.

“The destruction / grounding of the world’s Antonov fleet will render oversized project cargo shipping by air impossible, imposing major costs and delays on a huge range of industries, most notably the energy sector,” Flexport CEO Ryan Petersen said on Twitter.

March 8: Hong Kong Air Cargo Hit by Massive Reduction in Trucking from Mainland – The Loadstar

The southern China air freight market has changed “dramatically” as COVID rages in Hong Kong, severely impacting the local trucking market to and from the mainland.

Forwarders estimate there is a 70% cut in truck capacity, further diminishing Hong Kong’s air export market.

“Cross-border trucking has been impacted a lot, mainly due to truckers being found positive with Omicron, reducing manpower by 70% in this area,” said one forwarder.

March 10: U.S. Airlines Begin to Cut Flying as They Grapple with Fuel Costs – American Journal of Transportation

U.S. airlines have begun paring flight plans due to soaring fuel prices, underscoring the speed at which Russia’s attack on Ukraine has upended the industry and jeopardized a hoped-for rebound this year.

The industry concern is that exorbitant gasoline prices could sap consumers’ spending power and lead to slower demand for vacations and other leisure pursuits. Higher prices also raise costs for airlines, making it difficult to maintain profits if they can’t pass the expenses along to customers.

March 11: China Looking to Divert Flights from Shanghai as COVID Surges – American Journal of Transportation

China has discussed diverting international flights away from Shanghai to other cities, as the financial centre’s growing omicron outbreak puts pressure on quarantine hotels and isolation facilities, according to people familiar with the matter.

The country’s aviation authority asked airlines to nominate alternative ports of arrival for Shanghai flights, the people said. Passenger routes from Hong Kong won’t be affected, they said.

Officials cited stretched capacity at the quarantine hotels all travelers into China are required to isolate in, and concerns that space may be needed if the outbreak in Shanghai worsens. China isolates all virus cases, including those in the community, as part of its COVID Zero policy.

The diversion may last for as long as six weeks, and could come into force as soon as mid-March, though it is still under consideration, according to one of the people.

March 21: WestJet Cargo and the GTA Group Announce Partnership to Better Serve Canada’s Express Cargo Market – press release

WestJet Cargo and the GTA Group have announced a long-term partnership that will support the expansion and growth of domestic cargo opportunities for both businesses. Beginning in 2022, WestJet Cargo will partner with the GTA Group to increase shipping capacity using four dedicated 737-800NG freighters operated by WestJet, to fulfill overnight express cargo service out of WestJet’s Toronto hub.

“WestJet Cargo will bring customers new competitive options, and together with GTA we will disrupt the industry, providing more air freight capacity to domestic cargo customers who depend on reliable and on-time performance,” said Charles Duncan, Executive Vice-President, Cargo.

March 28: WestJet Making Final Preparations to Deploy Modified 737-800s for Freight Customers – American Shipper

Canadian shippers with express delivery needs will have more air cargo capacity to choose from this summer when WestJet launches its stand-alone freighter division.

WestJet plans to take delivery in Calgary of its first used Boeing 737-800 aircraft converted for cabin cargo within a week and have two aircraft in revenue service by July 1 or sooner, said Charles Duncan, executive vice president of cargo.

Operating from a base at Toronto Pearson International Airport, WestJet Cargo intends to start with limited charter work, transition to regular, scheduled flights between major cities within Canada and eventually blend in ad hoc charters and transborder flying to the U.S. and Caribbean, especially on weekends and other off-peak periods, he explained.

March 29: Cargo Airlines Cancel Flights as Shanghai Enforces COVID Lockdown – American Shipper

The staggered lockdown of Shanghai to contain the biggest wave of COVID-19 since the early days of the pandemic is quickly crimping the movement of air cargo.

City officials shut down the eastern half of the city on March 28 through April 1 and told people on the western side to quarantine at home or compounds from April 1 to 5 while they conduct mass testing. With no public transport and people stuck at home, manpower shortages are hindering manufacturing and logistics activity. Many factories and warehouses have closed, getting goods to and from local airports is difficult because few trucks are available and airports have limited staff to handle cargo, according to logistics companies operating in China.

Both Shanghai Pudong airport and Shanghai Hongqiao city airport are running, but with very limited capacity and mostly for passenger flights.

 

 

Rail

March 16: CP Issues 72-Hour Notice to Lock Out TCRC-Train & Engine Employees – press release

Canadian Pacific Railway has issued 72-hour notice to the Teamsters Canada Rail Conference (TCRC)-Train & Engine of its plan to lock out employees at 00:01 ET on March 20, if the union leadership and the company are unable to come to a negotiated settlement or agree to binding arbitration.

“For the sake of our employees, our customers, the supply chain we serve and the Canadian economy that is trying to recover from multiple disruptions, we simply cannot prolong for weeks or months the uncertainty associated with a potential labour disruption,” said Keith Creel, CP President and CEO. “The world has never needed Canada’s resources and an efficient transportation system to deliver them more than it does today. Delaying resolution would only make things worse. We take this action with a view to bringing this uncertainty to an end.”

Over the past week, CP and the TCRC leadership have been meeting daily with federal mediators to reach a new negotiated collective agreement in hopes of avoiding a labour disruption. Despite those talks, the two sides’ positions remain far apart.

March 20: CP Canadian Network Shutdown

On March 17, the Teamsters Canada Rail Conference (TCRC)-Train & Engine provided CP with its 72-hour strike notice to be effective 00:01 ET on Sunday, March 20. CP had previously issued notice to the TCRC of its plan to lock out employees at 00:01 ET on March 20, if the union leadership and the company were unable to come to a negotiated settlement or agree to binding arbitration.

An embargo application for shipments routing to and from CP Canadian locations is in place effective 00:01 Sunday, March 20. This embargo applies to:

CP has issued a notice of force majeure related to the shutdown.

March 21: Canadian Pacific and TCRC-T&E Reach Agreement to Enter into Binding Arbitration and Return to Work

Canadian Pacific Railway and the Teamsters Canada Rail Conference (TCRC) – Train and Engine Negotiating Committee have agreed to enter into binding arbitration.

“This agreement enables us to return to work effective noon Tuesday local time to resume our essential services for our customers and the North American supply chain,” said CP President and CEO Keith Creel.

CP will immediately begin working with customers to resume normal train operations across Canada as soon as possible.

 

 

Trucking

March 7: CTA and PMTC Have Opposing Views on Delay of ELD Mandate

Canadian Trucking Alliance – CTA Expresses Concern with Government Moving Goalposts on ELD Enforcement

The Canadian Council of Motor Transport Administrators (CCMTA) announced a delay in enforcement of the ELD mandate from June 2022 to January 2023.

The Canadian Trucking Alliance (CTA) is very disappointed by this announcement and has reasonable doubts that the new January date is certain, from a national perspective, based on the lack of legislative preparedness of four jurisdictions.

To enforce the federal mandate, each jurisdiction needs to have its own law on the books. Currently, four provinces are still without the required legislation or regulations in place to successfully transition their industries to ELDs – British Columbia, Quebec, Nova Scotia and Newfoundland.

Waiting for all jurisdictions to be ready, whenever that may be, in the name of ‘national unity’ is not in best interest of public safety or the trucking industry, which has already made the proper investments to comply with the ELD mandate. The vast majority of federally regulated fleets already have ELD technology in their fleets and the three certification bodies approved by Transport Canada and the Standards Council of Canada have qualified multiple ELD offerings, totaling 22 devices from 15 individual ELD vendors.

“There should be no more moving the goalposts on dates and no more delays. The time to finally start this important safety regime is past due,” said CTA president Stephen Laskowski.

Private Motor Truck Council of Canada – PMTC’s Position on CCMTA Federal ELD Enforcement Timelines Announcement

The PMTC is in favour of the delay of full enforcement of the ELD mandate. While we have always been in full support of the ELD regulation, the continued issues with a lack of approved devices have continued to plague the mandate, and although we now have 22 approved, industry has not been provided enough of a runway to select a device of their choice and implement it into their fleet in time for the June 12th deadline. We are also waiting for a PKI vendor and system to be announced by Transport Canada that allows for ELD data to be transferred securely from the device to enforcement personnel, as well as enforcement protocols, training and how the regulation will be enforced uniformly between jurisdictions.

This final delay provides enough time for industry to select a new approved device, or transition from their current device, in time to comply with the mandate, as well as provide enough time for regulators to address some of the issues mentioned. I suspect this will be the last delay in full enforcement we can expect to see, and carriers should ensure they are fully prepared to comply by January of 2023.

March 16: Canada’s Trucking Spot Market Continues Record-Setting Load Growth – Today’s Trucking

Canada’s spot market continues to offer an abundance of loads, “with no signs of slowing down any time soon,” according to Loadlink Technologies.

February volumes were up 171% year over year, and even beat January’s record highs by 21%.

Truck capacity tightened, with a truck-to-load ratio of 0.63, a 76% decline from last February’s 2.61 trucks per load. Single-day load volumes reached an all-time high in February, Loadlink reported, noting there was a heavy strain on inbound capacity.

March 31: B.C. In-Transit Process

On November 14th, 2021, British Columbia was subject to an unprecedented “atmospheric river,” which resulted in flooding and mass wasting events in various parts of the province. Through collaboration with partners from U.S. Customs and Border Protection (CBP) and other government departments and agencies in the U.S. and in Canada, the Canada Border Services Agency (CBSA) implemented a domestic in-transit emergency protocol to support the supply chain and emergency goods needing to move through the U.S. to reach destinations in Canada due to road closures in B.C.

The U.S. and Canada exercised a facilitative approach to these movements to ensure expedited availability of these goods during the emergency. The objective remained facilitative while not compromising safety and security for over 4,500 passages. As of December 21, 2021, all of the major routes into B.C. were restored and traffic resumed.

Based on consultations with trade chain partners and U.S. CBP counterparts, the temporary measures developed expire as of March 31 at 12:01 am PDT.

 

 

CIFFA Advocacy, Communications, Activities

March 4: CIFFA Sends Letter Regarding Prospect of Rail Service Interruption at CP Rail to Relevant Federal and Provincial Ministers

On March 4, CIFFA sent a letter – on behalf of the 20,000 employees working in Canada’s freight forwarding industry – to express alarm at the prospect of a rail service interruption at CP Rail, indicating that a significant disruption in rail services would be a catastrophic additional blow while supply chains remain severely impacted by COVID-19 and the resulting chaos in marine and tertiary transport.

March 11: 32 Business Associations, Including CIFFA, Write to Federal Ministers, Urging the Government’s ‘Full Attention’ on CP/Teamsters Negotiations

Thirty-two Canadian business organizations sent a letter on March 11 to Canada’s Ministers of Labour; Transport; Innovation, Science and Industry; International Trade, Export Promotion, Small Business and Economic Development; Agriculture and Agri-Food; and Natural Resources, urging the federal government to “do what is best for Canada’s economy and facilitate a negotiation between CP and the Teamsters Canada Rail Conference.

“While we support the right to collective bargaining,” they said, “this issue requires the government’s full attention to preserve jobs and protect Canada’s economy.”

March 21: Response from Employment and Social Development Canada to CIFFA Letter Regarding CP–TCRC Collective Bargaining

In response to a letter from CIFFA about the potential work stoppage at CP, Gary Robertson, Assistant Deputy Minister, Compliance, Operations and Program Development – Labour Program at Employment and Social Development, sent the following email message.

On behalf of the Honourable Seamus O’Regan Jr., Minister of Labour, I am responding to your correspondence about collective bargaining between the Canadian Pacific Railway and the Teamsters Canada Rail Conference.

Thank you for writing. Please be assured that the Government of Canada recognizes the importance of the Canadian Pacific Railway to Canadians and businesses. Federal mediators have been appointed and are assisting the parties in their negotiations. The Government of Canada cannot comment further at this time.

Maritime

February 3: Bipartisan Ocean Shipping Overhaul Introduced in U.S. Senate – BNN Bloomberg

The first major update of U.S. international ocean-shipping laws in more than two decades was introduced in the Senate on February 3, a significant step toward passage after passing the House with bipartisan support in December.

Republican Senator John Thune of South Dakota and Democratic Senator Amy Klobuchar of Minnesota introduced the Ocean Shipping Reform Act Thursday, which they say will ease the problem of agricultural exports sitting at ports while ocean carriers return to Asia with empty containers.

“Congestion at ports and increased shipping costs pose unique challenges for U.S. exporters, who have seen the price of shipping containers increase four-fold in just two years. Meanwhile, ocean carriers have reported record profits,” Klobuchar said in a statement.

The House version of the bill, sponsored by California Democrat John Garamendi and North Dakota Republican Dusty Johnson, was approved by an overwhelming majority in December.

February 7: Price of Ship Fuel Surging, Poised to Eclipse All-Time High – American Shipper

It should come as no surprise: Just as you’re paying a lot more for gasoline at the pump, ship operators are paying a lot more for marine fuel. In fact, average marine fuel prices are rising even faster than landside fuel prices. They’re now just a few dollars shy of all-time highs, with a new record seemingly imminent.

That’s bad news for shipowners, and to the extent fuel cost is passed on, bad news for cargo shippers, and, ultimately, those who buy imported goods.

The majority of cargo ships burn 0.5% sulfur fuel known as very low sulfur fuel oil (VLSFO). As of February 4, Ship & Bunker estimated that the average VLSFO price at the top 20 bunker ports had risen to $731.50 per ton, up 55% year on year. The national average gasoline price rose 40% over the same period, according to AAA.

February 9: Maersk Forfeits More Freight Forwarder Business to Pursue Long-Term Deals – American Shipper

Maersk executives on February 9 revealed new details on the carrier’s burgeoning long-term contract business.

Ocean carriers have traditionally split business down the middle: around half short-term spot deals, half long-term contracts. Maersk continues to separate itself from the pack, focusing on more long-term contracts of ever-longer durations.

The proportion of Maersk’s long-haul volumes covered by long-term contracts jumped from 50% in 2020 to 65% in 2021. This year, the share will rise to 70%.

On previous quarterly calls, A.P. Moller-Maersk CEO Soren Skou has referred to a rising share of multiyear contracts, for terms of up to three years. On Wednesday’s call, there was talk of contracts lasting up to a decade.

February 15: Vancouver Fraser Port Authority Gateway Infrastructure Fee 2022 (GIF2022) – Notice of Fee Implementation

The Vancouver Fraser Port Authority Board of Directors has approved proposed fee amendments that will take effect on May 1.

Anyone interested in making a written representation to the VFPA on the subject of the proposed fee may do so prior to April 15.

February 15: MSC, Maersk End Transpacific Cooperation with SM Line – Offshore Energy

The 2M Alliance partners, Maersk and Mediterranean Shipping Company (MSC), have ended their strategic cooperation with South Korean shipping company SM Line on the transpacific route.

“The slot swapping agreement between SM LINE and the 2M alliance partners on Asia to USA West Coast services will end with effect from May 8, 2022,” said MSC. “Consequently, MSC will cease the slot agreement with SM Line commercialized by MSC as the Rose service.”

The company added that current services covered by MSC, and those of the 2M network, will offer alternative coverage.

February 17: Forwarders Look to Shipper-Owned Containers to Boost Reliability – The Loadstar

With the pressure on equipment capacity showing no sign of abating, freight forwarders are increasingly turning to “shipper-owned containers (SOCs)” to minimize the risk associated with port congestion and potential penalties, amid COVID-induced supply chain dysfunction.

A study by Container xChange, a digital platform for equipment management, has found that the level of the top 50 forwarders accepting SOC requests had risen sequentially from 6% in 2019 to 18% in 2021, a three-fold change.

SOCs are the units typically placed by a shipper with the container line for cargo booked by them directly, or through a forwarding agent. These boxes come in the form of outright ownerships or leased arrangements.

February 21: Empty Container Avalanche Predicted to Cause Chaos Later This Year – Splash

When global supply chains snap back to some form of normality – widely tipped to be in the second half of the year – transport operators will have to brace for a new headache, with an avalanche of empty containers predicted to cause some chaos.

The delays in the supply chain during the pandemic have led to the need for additional containers to be used. When the supply chain normalizes, this will potentially create a pile of 3.5 million TEU of empty containers from the transpacific alone, according to a new report from Denmark’s Sea-Intelligence.

February 22: Ransomware Attack Hits Jawaharlal Nehru Port Container Terminal – The Loadstar

A suspected ransomware attack has knocked out the management information system at Jawaharlal Nehru Port Container Terminal (JNPCT), one of five marine facilities in India’s top container gateway of JNPT (also known as Nhava Sheva).

The attack was detected on February 21.

JNPT has not issued any official updates on the source and type of the attack, but JNPCT had one of its scheduled vessels divert to a nearby terminal after it abruptly stopped accepting vessels alongside.

The other private terminals at JNPT are operating normally, according to port sources.

February 22: Omicron Ripping Through Cargo Ships May Exacerbate Shipping Woes – BNN Bloomberg

Omicron is ripping through cargo ships, raising concerns that a surge in cases, coupled with China’s tightened quarantine requirements for vessels, could delay supply chain stabilization for the shipping industry.

COVID outbreaks are hitting ships globally, with cases increasing “exponentially,” said Francesco Gargiulo, CEO of the International Maritime Employers’ Council Ltd. Anglo-Eastern Univan Group, which has an active crew of about 16,000, is seeing infections on five to seven vessels a month compared with only one or two a month last year, the company said. Meanwhile, Wilhelmsen Ship Management Ltd. has had infections on four of its ships since January after less than a dozen vessels were struck with COVID in all of 2021, said Carl Schou, CEO at the ship manager.

February 24: Prince Rupert Port Seeking to Double Capacity Through the Addition of a Second Container Terminal – PRPA press release

DP World and the Prince Rupert Port Authority have entered into a two-year agreement to assess the feasibility of a new container terminal project in Prince Rupert. The potential project would add up to 2 million twenty-foot equivalent units (TEUs) of annual capacity to the Port of Prince Rupert, significantly increasing Canadian trade capacity with critical Asia-Pacific markets, with considerable potential employment and economic impacts that will bolster the western Canadian economy.

The proposed terminal represents the continued advancement of the Prince Rupert Port Authority’s container terminal master plan done in 2019, which outlined the potential for an additional container terminal, south of the existing Fairview Terminal. With this agreement, DP World and the Prince Rupert Port Authority will begin various studies on the proposed site, with a key focus on steps required to minimize environmental and community impact, improve the resilience of Canadian supply chains, and ensure the project’s full integration into the Port’s intermodal ecosystem.

February 25: Shippers Prepare as Ukraine Crisis Prompts Emergency Fuel Surcharges – The Loadstar

Shippers are bracing for a raft of emergency bunker surcharges from ocean carriers, as oil prices hit eight-year highs.

Following Russia’s invasion of Ukraine, the price of crude oil has soared to its highest level since 2014, to more than $105 a barrel, with analysts predicting $130 within weeks.

Meanwhile, Rotterdam-sourced low-sulphur fuel oil (LSFO) spiked on February 24 by more than $30, to $731.50 a ton, a 40% increase since December.

The Loadstar understands an emergency BAF was being considered by carriers before the events of this week, but according to a carrier source, the “die is now cast” on surcharge hikes.

“Many of our contracts have a BAF calculator built in, but for our spot and short-term deals, we have no option but to try to recover as much of the extra cost as possible,” he said.

February 28: Suez Canal Tolls Rise – Container News

Egypt’s Suez Canal Authority announced on February 27 that it will increase canal tolls by up to 10% for laden and ballast vessels.

The toll increase is effective from March 1, according to the Suez Canal Authority, which said the decision is “in line with the significant growth in global trade, the improvement of ships’ economics, the Suez Canal waterway development and the enhancement of the transit service.”

February 28: Barge Delays on Northern European Waterways Surge to Highest Peak in Years – The Loadstar

Congestion along Antwerp and Rotterdam’s inland waterways has surged to its highest peak in several years, leaving users stranded.

Wait times at Antwerp more than doubled over the past week, from 44 hours to 94, according to the latest figures from Contargo, while congestion at Rotterdam was up by more than 50%, to 128 hours.

 

 

Air

February 5: COVID-19 Cases among Staff, CNY Holiday Lead to Cargo Being Stuck at Singapore’s Changi Airport – The Straits Times

A triple whammy of COVID-19 infections among airport staff, a surge in shipments and the Chinese New Year holiday have led to severe delays in the processing of cargo at the usually efficient Changi Airport terminals.

Containers that usually take hours to process have been taking days for the past two weeks, freight forwarders said.

In a statement on February 5, a spokesman for Sats, the airport’s chief ground handler for airfreight, confirmed the build-up of cargo.

“Sats has deployed additional manpower from other parts of its operations to alleviate the situation and 70 percent of the backlog has already been cleared,” the spokesman said, adding that cargo import operations are expected to return to normal by February 8.

Ships waiting for urgent parts brought in by airfreight are also marooned at Singapore’s ports, while others are staying behind schedule to receive their shipments.

February 28: Air Canada Will Add 3 Freighters in 2022 to Diversify, Maintain Cargo Growth – Supply Chain Dive

The COVID-19 pandemic cratered air travel demand, and airlines are still struggling to climb back to their pre-pandemic passenger activity levels. Cargo operations, meanwhile, have been a bright spot for the industry, including Air Canada.

The airline operated 10,217 cargo-only flights in 2021, more than double the 4,235 it operated the year before, according to its financial results. Passenger travel remains Air Canada’s larger source of revenue, but YoY passenger revenue growth (3%) was easily outpaced by its cargo business (63%) in 2021.

The use of converted passenger aircraft, which have seats removed from the passenger cabin to free up cargo space, buoyed these results. Air Canada plans to have all converted aircraft back in passenger configuration by the end of 2022, Executive VP and CFO Amos Kazzaz said.

However, the airline still expects to benefit from increased air cargo demand through the use of its new dedicated freighters. Air Canada is also investing $16 million to bolster its cold chain handling capabilities at its Toronto Pearson International Airport cargo facility.

 

 

Rail

February 23: Chicago Suburbs Protest Planned CP-KCS Merger – FreightWaves

Eight Chicago suburbs are seeking to prevent the merger between Canadian Pacific and Kansas City Southern from happening, saying that the additional traffic coming from the merger would create more gridlock from blocked crossings and could cause environmental harm to their communities.

Local officials say they will collectively file their objections with the Surface Transportation Board next Monday. Their communities run along the Milwaukee District West line of Chicago commuter rail service Metra, which operates on tracks that are part of CP’s Elgin subdivision.

Shareholders of CP and KCS approved the $31 billion deal in December, and the merger is now before STB for review.

 

 

Trucking

February 1: Kenney Calls for Calm at Alberta Border Blockade after Some Protesters Breach Police Barriers – CBC News

Officials are calling for cooler heads to prevail after a trucker blockade – which began on January 29 at the Canada-U.S. border in southern Alberta – grew violent on February 1.

“This kind of conduct is totally unacceptable,” said Premier Jason Kenney.

The protest of trucks lined up in front of the border checkpoint has halted all traffic. The Coutts crossing is the primary conduit for an estimated $6 billion in exports from Alberta to the United States, according to the premier.

The demonstration is tied to an ongoing, nationwide protest over federal rules for unvaccinated or partially vaccinated truckers entering Canada from the U.S. The rules took effect Jan. 15.

Kenney said about 100 individuals are preventing thousands of truckers from doing their job of delivering food, goods and medicine to Albertans and Canadians, emphasizing that blocking a key piece of infrastructure is against the law.

February 3: Breakthrough in Alberta Border Blockade, Lanes Open in Both Directions – CTV News

There has been a breakthrough to resolve the impasse at a protest blockade at the United States border in southern Alberta.

Chad Williamson, a lawyer representing truckers blocking access to the border crossing at Coutts, Alta., says they have spoken with Mounties and agreed to open some blocked lanes.

Williamson says the protesters are starting to feel they have been heard, “but this isn’t over.”

Trucks and other vehicles have begun clearing two lanes – one going north and one going south.

“This is a sign of optimism,” said Cpl. Curtis Peters of the Alberta RCMP, “but is not an end to the police presence here.” Work is continuing to clear the road completely, he said.

February 5: No End in Sight to Ottawa Protests, Not Enough Resources, Says Police Chief – CBC News

Ottawa’s chief of police says he does not have enough resources to end the turbulent protests launched in the nation’s capital more than a week ago – nor can he say when they might come to an end.

“We need an additional surge of resources,” Chief Peter Sloly said Saturday, even though every available Ottawa Police Service (OPS) officer is on active duty and hundreds of other law-enforcement officials have come to help.

More than 7,000 demonstrators came into the downtown on February 5, according to police, and 500 heavy trucks still remain in the so-called “red zone.”

February 8: Second Day of Ambassador Bridge Protest Halts Vehicles from Leaving Michigan, Limits Windsor to U.S. Traffic – CBC News

People protesting pandemic restrictions and lockdowns are preventing vehicles from using the Ambassador Bridge for a second day, with traffic halted from Michigan to Windsor, Ont., and limiting traffic to the U.S.

The bridge is one of the busiest international land border crossings in Canada and a major route for transport trucks.

On February 8, protest cars and trucks are lining Windsor’s Huron Church Road, the main road connecting Highway 401 to the bridge. Police are asking people to avoid the area, which has been clogged since the afternoon of February 7.

February 9: Canada Border Protests Start Halting Detroit Auto Plant Production – NBC News

Traffic over the Ambassador Bridge has come to a virtual halt. Only a small number of trucks moved from Canada to Michigan on February 9. The situation at the Blue Water Bridge connecting Sarnia, Ontario, to Port Huron, Michigan, isn’t much better, with reported delays of at least 4½ hours.

The Chrysler Pacifica minivan plant became the first direct casualty. Officials with global automaker Stellantis temporarily halted production at the factory because it doesn’t have enough parts. Ford became the second manufacturer to take steps to deal with parts shortages.

“While we continue to ship our current engine inventory to support our U.S. plants, we are running our plants at a reduced schedule today in Oakville [Ontario] and our Windsor engine plant is down,” Ford said in a statement.

General Motors, Detroit’s largest automaker, confirmed late on February 9 that it had temporarily cut the second shift at a plant in Lansing, Michigan producing SUVS for the Buick, Chevrolet and GMC brands. Toyota also shut down production at three of its plants in Ontario due to parts shortages from the trucker blockade.

It could be a matter of hours before other automakers, domestic and foreign, have to take steps at assembly and parts plants within hours of the two bridge crossings.

February 13: Police Break Up Remaining Protest at Windsor’s Ambassador Bridge – CBC News

Officers from multiple police forces advanced on February 13 to clear out the remaining protesters and break up a days-long occupation near the Ambassador Bridge border crossing in Windsor, Ont.

Windsor Mayor Drew Dilkens said that, once police have the situation fully under control, the plan will move to figuring out how to properly reopen the roadway to the bridge.

A spokesperson for the Canada Border Services Agency said it was “working collaboratively with law enforcement partners to restore normal border operations at affected ports of entry as quickly as possible.”

February 14: Federal Government Invokes Emergencies Act for First Time Ever in Response to Protests, Blockades – CBC News

Prime Minister Justin Trudeau says he’s invoking the Emergencies Act for the first time in Canada’s history to give the federal government temporary powers to handle ongoing blockades and protests against pandemic restrictions.

“It is now clear that there are serious challenges to law enforcement’s ability to effectively enforce the law,” said Trudeau.

“It is no longer a lawful protest at a disagreement over government policy. It is now an illegal occupation. It’s time for people to go home.”

Trudeau said the measures will be geographically targeted and “reasonable and proportionate to the threats they are meant to address.”

The unprecedented deployment of the Emergencies Act gives police more tools to restore order in places where public assemblies constitute illegal and dangerous activities, such as blockades and occupations, he said. Trudeau said the act also will enable the RCMP to enforce municipal bylaws and provincial offences where required.

February 14: Trucking Rates Between U.S., Canada Soar on Trade Blockade – Bloomberg

The trucker blockade at the U.S.-Canada border has ended but efforts to tally the economic costs are still under way.

The disruptions added costs to already-elevated charges for freight between the U.S. and its largest trading partner. According to data from Truckstop.com, spot market rates for flatbed, refrigerated and van categories rose between January 2 and February 5 for all loads going to and from Canada.

February 15: Canada’s Spot Market Load Volumes ‘Literally Off the Charts’ – Today’s Trucking

Canada’s spot market is so strong, freight volumes are off the charts, according to Loadlink Technologies, which had to adjust its reporting charts to accurately reflect January volumes.

Loads surged 154% year over year, marking the best January on record by an additional 14%. Shipments from Canada to the U.S. were nearly three times higher than a year ago.

Meanwhile capacity is tight, with just 0.93 trucks posted per load.

“Combining the current truck shortage with the huge surge in loads only compounds the capacity constraints,” says Claudia Milicevic, president of Loadlink Technologies. “Truck-to-load ratios are even lower than the record low capacity crunch that temporarily ensued following the electronic logging device (ELD) mandate in the U.S. close to five years ago.”

February 23: MTO Grounds Trucking Businesses Involved in Illegal Occupation in Ottawa – Today’s Trucking

The Ontario Ministry of Transportation has effectively shut down 39 trucking businesses in the wake of a crackdown on so-called Freedom Convoy protesters.

The ministry confirmed that 12 suspension and seizure orders were issued to Ontario-based large truck operators involved in the protests, suspending their operating authority throughout Canada, and issuing an order to seize all the plates registered to them.

Twenty-seven seizure orders were issued to large truck operators from outside the province, banning them from operating any commercial motor vehicle in Ontario.

The names of the sanctioned businesses, as well as the number of affected trucks, were not revealed.

 

 

CIFFA Advocacy, Communications, Activities

February 1: CIFFA Issues Paper: 10 Best Cybersecurity Practices in 2022 – CIFFA’s Resources webpage

CIFFA’s Technology Committee has issued a guide for Canadian freight forwarders, 10 Best Cybersecurity Practices in 2022.

The committee drew on the expertise of several members, as well as significant research, to compile this top 10 list. Members that put some or all of these practices in place should significantly increase their cybersecurity.

Maritime

January 4: Ningbo Lockdown Measures Tightened – Splash

A notice from Ningbo Customs has detailed a business emergency response mechanism with changes to some customs clearance and inspection operations in locked-down Beilun district, an area of the city that houses some of the busiest container terminals.

Freight forwarder Shapiro reported that a container depot that is located in the lockdown area has suspended operations.

The port’s average daily container throughput is more than holding up thus far. From January 1 to 3. daily throughput exceeded 97,000 TEU, up 8.5% year-on-year.

“The heightened restrictions could result in production disruptions, including short-term delivery and order fulfillment delays, at factories in the affected areas of Beilun District. Processing delays and shipping disruptions are possible at the Ningbo Port; however, officials have issued passes for permitted truck drivers to enter closed locations and designated ‘greenways’ for container vehicles to access the port area,” an update from risk management consultants Crisis24 stated.

January 5: FMC Stepping Up Its Scrutiny of Liner Shipping – gCaptain

In an end-2021 flurry of activity, the U.S. Federal Maritime Commission (FMC) issued Orders of Investigation into both the Ocean Network Express (ONE) and Wan Hai Lines. In each case, a written response is required within 25 days.

Hearings will be held within six months, presided over by an Administrative Law Judge who has the power to impose monetary penalties, if a violation of the law is found to have occurred.

The investigation into ONE stems from a late-2020 inquiry into carriers’ practices regarding bills of lading. An NVOCC not listed on the bills of lading arranged for a shipment of lumber cargo from Brazil to Houston. For unspecified reasons, the cargo sat on the dock in Houston from November 2018 into January 2019, and it seems that ONE then charged detention to the NVOCC and brought a lawsuit in Federal District Court in an effort to collect it. The FMC investigation will look closely at “privity” on bills of lading.

The investigation into Wan Hai will look into practices of carriers concerning the return of empty containers, and detention charges when the boxes are not turned back to the carriers. According to the FMC’s complaint, Wan Hai charged cargo interests for detention nearly two dozen times during the spring of 2021, when the jammed-up terminals at southern California ports were unable to accept returns of containers.

January 6: UK Freight Forwarding Association Lashes Liner Conduct – Splash

The British International Freight Association (BIFA) has written to the UK government asking it to investigate the state of competition within the current container shipping market, the latest in a wave of liner complaints sent to governments around the world during a period of record earnings for carriers and the poorest schedule reliability in the history of containerization.

The UK’s main trade association for freight forwarding and logistics companies says that its members are concerned that certain practices undertaken by the principal container shipping lines, as well as easements and exemptions provided to them under competition law, are distorting the operations of the free market to the detriment of international trade.

January 7: New Year Brings New All-Time High for Shipping’s Epic Traffic Jam – American Shipper

The holiday rush may be over, but the offshore traffic jam of container ships is still getting worse, and the volume of inventory on the water is still increasing.

As 2022 begins, import volumes remain very strong ahead of China’s Lunar New Year holiday, concerns are mounting about omicron-induced dockworker shortages at U.S. terminals, and the number of container ships waiting for berths in Southern California has – yet again – hit a new high.

January 7: Shenzhen on Alert as More COVID-19 Cases Crop Up – Splash

China’s whac-a-mole approach to containing COVID-19 is seeing restrictions rushed in at many more important hubs across the country as the nation struggles to contain more contagious variants spreading.

Two COVID-19 cases in Shenzhen have seen local authorities usher in travel bans, making it difficult to leave the city, with more mass testing underway in the city’s Longgang district. Trucker availability at the key southern Chinese box port is likely to be hit by this latest outbreak.

January 7: Trucker Snarl in East China Hits Ningbo’s Container Shipping – American Journal of Transportation

A suspension of trucking services in several parts of East China’s Zhejiang province has slowed the transportation of manufactured goods and commodities through one of the world’s most important ports.

There are strict controls on trucks moving goods to or from the Beilun district in Ningbo after the discovery of several cases of COVID-19 in the area, shipping line A.P. Moller-Maersk A/S said in a Thursday customer advisory. This suspension, along with restrictions on truckers in some areas in and around Zhejiang, has halted operations at some yards and warehouses at Ningbo port.

January 13: Shipping Congestion Is Growing at Shanghai Port – Yahoo Finance

Ships looking to avoid COVID-induced delays in China are making a beeline for Shanghai, causing growing congestion at the world’s biggest container port.

Shipping firms are making the switch to avoid delays at nearby Ningbo, which suspended some trucking services near that port after an outbreak of COVID-19, according to freight forwarders and experts. Ships are also rerouting to Xiamen in the south.

Those diversions are adding to the new wave of congestion facing China’s ports as an increasing number of cities deal with virus outbreaks. The strict testing of workers and truckers ahead of the Lunar New Year holiday at the end of this month is further stressing already strained supply chains.

January 18: Lines Hit with Collusion Charges in South Korea – Splash

In a landmark ruling that will be watched carefully by other jurisdictions around the world, South Korean authorities slapped fines on 23 containerlines, claiming they had been colluding together to keep rates high on certain intra-Asian tradelanes over a 15-year period.

A total of US$81 million in fines were levied against lines including HMM, Evergreen, Wan Hai, Cosco, OOCL, Heung-A, SM Line and Korea Marine Transport Co.

January 19: Maersk Space Ban: ‘A Dark Future’ for Small Forwarders – The Loadstar

Small freight forwarders fear for their survival following Maersk’s decision to offer them only its Maersk Spot product.

Larger forwarders have secured long-term contracts with other lines, but smaller forwarders are unable to follow suit.

“With Maersk, you can get spot rates only, which means you cannot plan a shipment, and we small players can never find a space with Maersk,” said one European company.

“The spot quote has a very short validity; it can expire on the same day if Maersk runs out of space, and it is not valid on the next vessel. How can we work in a such way?”

January 20: Forwarders Fear ‘Shut-Out’ as Other Major Lines Emulate Maersk Strategy – The Loadstar

Increasing numbers of forwarders claim they are being “shut out” by shipping lines that appear to be focusing on very large forwarders and BCOs. There is suspicion that several European carriers are looking at a similar approach to that of Maersk.

“We’re getting the feeling and feedback from individual sources that this is the case,” one U.S. forwarder executive said.

He said none of the shipping lines had made a clear statement that it intended to leave out forwarders in the future, but problems with bookings – being told that there is no available space, or elevated pricing that renders a shipment unviable – had raised suspicions.

Another forwarder said: “We are facing up to the fact that the Maersk decision is the first step for shipping lines. “The problem we are facing is that the carriers are offering big players … long-term contracts with special conditions, and that strategy is immediately impacting smaller and mid-size forwarders worldwide, because those kind of contracts are not within our reach.

“Those contracts are dealt with at the headquarters of the big players, dealing with big volumes and dismissing our local volumes.”

January 21: Forwarders Have to Turn Away Large New Customers Thanks to Capacity Squeeze – The Loadstar

Some mid-size forwarders are rejecting new larger customers, having been forced to adapt their business model to accommodate the contract ban from Maersk and the reluctance of other shipping lines to offer much capacity.

Maersk’s move to restrict them to its Spot product only is said to have left some “4m TEU looking for a new home,” according to one source.

One medium-size forwarder said it was forced to adapt quickly to the new status quo after “Maersk outlined its intentions fairly clearly, so we started talking to other carriers.”

It added: “But it has pushed the market. Until now most of us have searched for new business with sizeable volumes. But now, with the long-term contracts, it’s quite stagnant. We won’t look for new business because there isn’t the capacity.”

January 21: Yantian Restricts Container Entry to Ease Overflow – Splash

With containers overflowing in and out of its borders, the operators of Yantian terminal, the largest port facility in Shenzhen, have from January 21 ruled that full containers can only be trucked in four days before vessels are due to berth.

Shenzhen, the world’s fourth largest container port, is suffering from severe congestion just ahead of the Lunar New Year holidays, exacerbated by recent COVID-19 outbreaks that have seen parts of the city forced into lockdown. Ships arriving at Yantian are currently having to wait around one week for a berth space.

January 21: Asia-U.S. West Coast Spot Rates Spike Ahead of Chinese New Year – gCaptain

Container spot rates from Asia to the U.S. west coast spiked last week, ahead of the Chinese New Year holiday on February 1.

Drewry’s WCI U.S. west coast component put on 5%, to $11,197 per 40ft, while the Freightos Baltic Index (FBX), which includes an element of premium fees, gained 3.5%, to $15,139.

For the U.S. east coast, there were mixed messages from the spot indices, with the WCI up 2% on the week, to $13,987 per 40ft, in contrast to the FBX reading, which declined 2.5%, to $17,023.

In a customer advisory, Maersk said there could be enough labour available to keep production ticking over during the CNY holiday and thus would not be reducing services in the immediate post-CNY period.

January 27: Halifax Port Authority to Undertake 3-Year Pier A-1 Infilling Project – press release

The Halifax Port Authority (HPA) is preparing to begin infilling the basin between Piers A-1 and B at Ocean Terminals located at the Port of Halifax. This project is expected to start in May 2022.

To prepare for the project, Pier A-1, including Shed 33 and Shed 34, as well as the pier rail sidings, will no longer be available for access to general cargo operations beginning in May. The port is working with common port users to provide them with available options so they can transition to other available areas within the Port of Halifax and minimize the impact on their business. There is alternate terminal and shed space available at Ocean Terminals and Richmond Terminals.

The infilling is expected to take approximately three years to complete and will create an additional 3.2 hectares (approximately 8 acres) of yard space. The project will occur within the existing footprint of industrial cargo operations.

A Fisheries Act Authorization was granted in 2018 by Fisheries and Oceans Canada, and habitat offsetting will be implemented. Two hundred and sixty artificial reefs, also known as reef balls, will be installed as a method of marine environmental remediation.

The completed project is expected to improve overall efficiency and safety, and lead to more environmentally sustainable operations overall.

January 27: Schedule Reliability Dropped to Record Low at the End of 2021 – The Maritime Executive

Schedule reliability among the major container shipping lines hit a new low at the end of 2021 with the expectation being that, with continuing port congestion, there is unlikely to be a significant improvement.

New data from Sea-Intelligence shows that containerships’ ability to maintain published schedules reached the lowest level in the decade the analytics and advisory service has been tracking the industry.

“Schedule reliability dropped again, this time by 1.2 percentage points month over month to 32 percent, the lowest-ever global schedule reliability since Sea-Intelligence started the measurement in 2011,” notes Alan Murphy, CEO of Sea-Intelligence. “On a year-over-year level, schedule reliability was 12.5 percentage points lower.”

January 31: Long-Term Rate Increases Losing Momentum as Carriers Seek to Lock in BCOs – The Loadstar

There are signs that the exponential rise in long-term liner contract rates is losing steam after 14 consecutive months.

Ocean and air freight rate benchmarking platform Xeneta’s XSI long-term contract rate index fell 3.6% this month, following a decline of over 4% recorded in December.

The XSI decline could be a blip, but it could reflect carrier aspirations of signing up shippers to long-term deals.

 

Air

January 4: Flights Cancelled at Xi’an, with Worse to Come as Chinese New Year and Olympics Loom – The Loadstar

China’s ninth-busiest airport for cargo is still facing large numbers of flight cancellations following an outbreak of COVID in the city of Xi’an.

The government imposed a strict lockdown in mid-December and has since cut off most transport to the city.

The next eight weeks are expected to see some significant disruption in China: Not only will its “zero-COVID” policy lead to local restrictions, but with both the new year holiday and Beijing Olympics at the start of next month, the government is expected to crack down on transport. Forwarders said they expect few charter flights to be approved and restrictions on other flights, in particular into the capital.

January 21: 5G Doomsday Crisis Averted, Say FAA And Airlines – Forbes

Fears that the U.S. 5G rollout would cause widespread disruption to air travel have dissipated, with a collective sigh of relief from both the government’s aviation agency and airlines.

The Federal Aviation Authority (FAA) has approved 78% of the U.S. commercial aircraft fleet to perform low-visibility landings at airports where wireless companies deployed 5G in the C-band. The 13 cleared altimeters are found on a variety of commercial aircraft, including eight Boeing and eight Airbus models, as well as some Embraer 170 and 190 regional jets.

“The good news is we now have what should have been going on for quite some time, which is the manufacturers, the telecoms, the government agencies all sharing information that they need to make sure that this can be rolled out in a way that all Americans get 5G and all Americans know that their flights aren’t going to be impacted by that 5G,” said American Airlines CEO Doug Parker.

“It’s taken a while to get to the right spot, but I feel like we’re in the right spot,” Parker said. “I don’t think you’re going to see any material disruption going forward because of this.”

 

Rail

January 26: CN Names Robinson Its Next Top Exec, Reaches Agreement with TCI – Progressive Railroading

CN has announced Tracy Robinson will become its next president, CEO and a board member on February 28.

Robinson’s appointment follows the previously announced retirement of Jean-Jacques Ruest as president and CEO. Ruest will depart CN’s board on February 28, but remain at the railroad as an adviser until March 31 to ensure a seamless transition, CN officials said in a press release.

Robinson will join CN from TC Energy, where she is executive vice president, president of Canadian Natural Gas Pipelines and president of Coastal GasLink. Prior to TC Energy, Robinson spent almost three decades at Canadian Pacific. She has 35 years of operational management, strategy development and project execution experience to drive growth and profitability.

CN also announced it has reached a resolution agreement with CIFF Capital and TCI Fund Management (collectively TCI) that calls for CN and TCI to mutually agree on the appointment of two independent directors before CN’s 2022 annual general meeting. TCI agreed to withdraw its requisition for a special meeting of shareholders and to support the election of all CN director nominees at the 2022 and 2023 annual meetings.

 

Trucking

January 4: B.C. Flood Recovery Continues, but It’s Hardly Trucking as Usual – Today’s Trucking

Weeks after severe flooding wreaked havoc on B.C.’s road and rail network, round-the-clock repairs are bringing a sense of stability to carriers that haul freight in the province. As for normalcy, that’s something else entirely.

A lack of predictability remains the big problem, says Dave Earle, president and CEO of the B.C. Trucking Association (BCTA). “It’s getting better. It is one thing if you know a route is going to take you twice as long as before. The problem is, when you don’t know how long the route is going to take, it is awfully difficult to plan.”

Even when the timelines stabilize, the extra hours can upend traditional schedules and trip planning activities. A commercial run from the Fraser Valley to Kelowna used to take about six hours, so a rounder could be completed in a day. Now that takes 12 hours to do, the driver must overnight in the truck, and it takes 12 hours to return. “Instead of doing two loads in 12 hours, you are doing two in 36. It’s taking a lot longer,” Earle says.

January 7: CBSA and CBP Joint Updated Emergency Protocols in Response to Flood Situation in British Columbia, Canada

The CBSA and CBP issued on January 7 an update to the B.C. flood emergency protocols.

January 17: Port of Vancouver’s Ban on Trucks More Than 10 Years Old Delayed – Splash

After industry outcry, Canada’s Port of Vancouver has decided to postpone its Rolling Truck Age Program that was supposed to take effect on February 1. Trucks more than 10 years old will continue for an unspecified period to be admitted to the port.

“We have recently heard some concerns about our program start date from industry and Transport Canada, and we recognize that the pandemic, recent flooding, and on-going global supply chain issues may have created some short-term challenges for people looking to buy compliant trucks,” said Vancouver Fraser Port Authority VP Duncan Wilson.

“We are thus postponing our program start date slightly, to provide some additional time and engagement opportunities for industry, and to hopefully mitigate some of those challenges.”

January 18: B.C. Highways Continue to Reopen – Today’s Trucking

The Coquihalla Highway reopened to regular vehicle traffic between Hope and Merritt, B.C., on January 19.

Travel times between Hope and Merritt can be expected to take about 45 minutes longer than usual, due to reduced speed limits and temporary repairs that are in place, the Ministry of Transportation and Infrastructure warns.

The province is also lifting weight restrictions on Hwy. 99 between Pemberton and Lillooet, but is warning commercial truckers to avoid the route if possible, especially if they lack winter driving experience.

January 19: Vaccine Mandate or Not, U.S.-Canada Cross-Border Freight Rates Poised to Rise – FreightWaves

Since January 15, U.S. truckers who are unvaccinated or partially vaccinated against COVID-19 have been barred from crossing into Canada. A similar mandate is expected to hit Canadian drivers at the U.S. border on January 22. Already, the mandates are being blamed for a jump in rates.

But cross-border freight pricing was already poised to increase significantly by necessity. Increasing demand for consumer goods and tight capacity have collided with higher costs and a scarce supply of drivers and equipment.

Spot rates in January across multiple U.S.-Canada lanes have been 10% to 20% higher than a year ago, according to freight brokers. The big unknown: How many drivers will leave cross-border freight in response to the mandates and to what extent that will push rates higher.

January 23: ‘Freedom Convoy’ of Truckers Opposing Vaccine Mandate Leaves Metro Vancouver for Ottawa – Global News

Hundreds of B.C. truckers took to the road Sunday kicking off what they called a “freedom convoy” to Ottawa in protest of the federal government’s COVID-19 vaccine mandate for cross-border truckers.

Scores of big rigs gathered in pre-dawn fog in Delta before rolling out, and will be joined by groups from Vancouver Island and communities in the B.C. Interior as they make their way east.

January 24: B.C.’s Highway 1 Reopens Through Fraser Canyon – Today’s Trucking

Highway 1 through the Fraser Canyon, a major route connecting the Lower Mainland to B.C.’s Interior and North, opened to all vehicle traffic at noon on January 24, marking another milestone in British Columbia’s recovery from November’s flooding.

Depending on the destination, drivers travelling Highway 1 through the Fraser Canyon should plan for delays of up to two hours or more. This is due to ongoing repairs, an at-grade train crossing and sections of single-lane alternating traffic, which includes a temporary single-lane bridge at Jackass Mountain and Nicomen River crossing.

January 31: Alberta Premier Says Massive Blockade Preventing Access to U.S. Border ‘Must End’ – CBC News

Alberta Premier Jason Kenney is calling for a massive vehicle blockade preventing access to the Canada-U.S. border crossing to end, saying it is causing “significant inconvenience for lawful motorists.”

Truckers and motorists travelling to and from the United States from southern Alberta have been caught up in gridlock as an extremely large blockade of vehicles tied to an ongoing nationwide protest over COVID-19 public health measures continues to jam border traffic.

Vehicles have been blockading the highway from south of Lethbridge, Alta., to the Canada-U.S. border crossing in the village of Coutts since Saturday afternoon. That means that traffic to and from the border crossing has largely come to a standstill.

 

CIFFA Advocacy, Communications, Activities

January 26: Force Competition in Our Marine Sector: CIFFA’s Executive Director Bruce Rodgers on Why Canada’s Competition Laws Need More Bite

On January 31st, the federal government will convene a summit to discuss supply chain frustrations with a wide variety of participants.  Despite the odds against rapid success, it’s a welcome effort.

The stubborn supply chain mess affects virtually every consumer and community. And although the problems are certainly international, there are things that can be done right here in Canada, to improve the situation.

Ottawa has been tiptoeing along a very narrow line: trying to be seen as active on the problem, while avoiding any expectation that the government could craft a “solution” that solves all the problems. Presumably political advisers were telling the Cabinet, “You touch it, you’ll own it.”

But south of the border the U.S. President took an aggressive tack, travelling to a California port and personally urging railroads, truckers and ports to take extraordinary measures. By Christmas the White House was touting evidence the situation was improving.

January 31: CIFFA Participates in National Supply Chain Summit

The 3+ hour Summit, during which participants presented their industry and sector-specific concerns and comments, was led by the federal Transport Minister, the Honourable Omar Alghabra, and included presentations by the Honourable Mary Ng, Minister of International Trade, Export Promotion, Small Business and Economic Development, Annie Koutrakis, Parliamentary Secretary to the Minister of Transport, the Hon. Carla Qualtrough, the Minister of Employment, Workforce Development and Disability Inclusion, the Hon. François-Philippe Champagne, Minister of Innovation, Science and Industry, and the Hon. Marie-Claude Bibeau, Minister of Agriculture and Agri-Food.

Overarching themes and discussion points included the following:

In his closing comments, Minister Alghabra said, “I hear you and I have been hearing you for awhile and that is the reason why we ended up doing this summit.”

He thanked participants and noted that industry needs to continue to be involved in this discussion. As next steps, he announced that there would be a focus on more regional and sectoral roundtables in the coming weeks.

As well, he announced the government will create a task force made up of industry leaders who will provide advice to Minister Alghabra about next steps.

The Minister is hoping for a comprehensive action plan, including both immediate and short-term, as well as longer-term, strategies by summer.

Minister Alghabra reaffirmed the government’s commitment to maintaining this dialogue, and said the role of industry is valued not only with respect to dealing with supply chains but also with aim to improve our collective economic future.

Special Section – B.C. Floods

December 1: Port of Vancouver Operations Update

CP and CN eastbound and westbound trains continue to transit on CP’s mainline between Vancouver and Kamloops. Enhanced track inspections and maintenance are ongoing and low-speed restrictions remain in place. Engineering teams continue to undertake repairs on CN’s mainline between Kamloops and Boston Bar at a site impacted by heavy precipitation. A timeline for restored rail operations through the site is currently unavailable.

Container terminal truck activity remains steady. Restored highway routes include detours, intermittent closures and essential-traffic-only restrictions. Proactive closures may occur when heavy rainfall is forecast. Reconstruction and repairs continue on major roadways across the region.

Demand for anchorages continues to exceed capacity.

December 3: CP Customer Update on B.C. Operations

CP said in a customer advisory that recovery efforts on its Thompson and Cascade subdivisions in British Columbia continue in a safe, steady and deliberate manner.

That route is CP’s busiest corridor, handling a wide range of products and commodities. It links the Port of Vancouver and B.C. to the rest of Canada and North America.

The corridor includes a directional running zone where CP and CN share rail infrastructure to maximize capacity for both railroads. During CN’s outage, CP continues to share its single line capacity with CN, operating in both directions. Delays in the directional running zone will continue until CN restores its main line.

December 3: B.C. Slowly Opens Roads, Transport Disruptions Continue – Inside Logistics

The B.C. government announced the reopening of Highway 1 between Abbotsford and Hope on December 2, signalling a gradual improvement in travel conditions in the province after almost two weeks of flooding and landslides disrupted road and rail connections throughout the Lower Mainland.

However, the situation remains tricky for many businesses, including those using rail services to and from the Port of Vancouver.

December 6: Port of Vancouver Operations Update

Both CP and CN mainlines between Vancouver and Kamloops are fully operational. Rail traffic through the Fraser Canyon corridor has resumed in both directions. All eastbound trains are transiting via CP’s line and all westbound trains are transiting via CN’s line. Enhanced track inspections and maintenance activities continue, and low-speed restrictions remain in place.

December 8: Port of Vancouver Ship Backlog Hits 60 – American Shipper

The Port of Vancouver hit a grim milestone this week as the number of ships waiting for a berth reached 60 despite the resumption of rail service.

While CN and CP have reopened their rail lines serving the port – between Kamloops and Vancouver – they still aren’t operating at full capacity. And the volume of containers has picked up, particularly since CN began moving trains between Kamloops and Vancouver over the weekend.

The volume of containers leaving Vancouver via rail has increased by nearly 250% in the past week, according to FreightWaves’ SONAR platform, but remained about 40% lower than before flooding and landslides cut off CN and CP service to the port more than three weeks ago.

December 8: U.S. CBP Cargo Systems Message – Update: CBP and CBSA Joint Updated Emergency Protocols in Response to Flood Situation in B.C.

Due to extreme weather conditions in British Columbia that have caused flooding, landslides, road closures and other supply chain disruptions, Canadian domestic truck carriers may need to transit through the U.S. to reach destinations in Canada. Any Canadian carriers that currently operate between the U.S. and Canada as well as domestically are encouraged to follow the standard procedures for transit, including the advance filing of an electronic truck manifest and utilization of an in-bond or in-transit transaction. This will facilitate crossing and decrease delay at the border that will be caused by these temporary measures.

The requirements in this message are designed to be utilized by Canadian domestic truck carriers that don’t normally cross the border in the normal course of their business and to provide some guidance to international carriers carrying Canadian domestic shipments during the duration of these procedures.

December 16: B.C.’s Highway 5/Coquihalla Highway to Reopen by December 20

B.C.’s Minister of Transportation and Infrastructure Rob Fleming announced that Highway 5, the Coquihalla highway, will reopen no later than end of business on December 20.

The BC Trucking Association reports that:

December 21: FMCSA Extends B.C. Flood Relief Exemptions to January 31 – Canadian Trucking Alliance

The U.S. Federal Motor Carrier Safety Administration has extended its original Regional Emergency Declaration issued November 24 until January 31, allowing continued movement of Canadian goods through the U.S. to bypass road closures and areas in Canada cut off by flooding and landslides. The original declaration was set to expire on December 23.

December 22: CN Network Returns to Normal after Washouts in British Columbia – Progressive Railroading

CN’s British Columbia network productivity has returned to pre-washout levels as crews continue to return track to service following recent washouts in the province.

The British Columbia network was shut down between Nov. 14 and Dec. 4 as the Class I experienced 58 outages over 150 miles.

Approximately 282,000 cubic yards of rock, earth and backfill materials were moved to rebuild damaged locations, the equivalent of 25,000 truckloads.

Despite setbacks – including a recent stoppage near Jasper and cold weather in the Prairies – operating metrics are pointing to a “successful recovery” nearly two weeks after the network reopened, CN officials said.

 

Maritime

December 2: Omicron Fears Already Playing Havoc with Crew Changes – Splash

The omicron strain of COVID-19, first identified in South Africa in the last week of November, is already causing havoc to crew change operations around the world.

Travel restrictions have been rushed in at many key hubs over fears that the new variant is more contagious than earlier strains. Singapore, one of the most important crew change hubs in the world, has barred the entry of vessels from Africa, while another important Asian hub, Hong Kong, now has 44 countries on a high-risk list, meaning ships that have called at these nations 21 days or less before arrival at the Chinese city will not be allowed to carry out crew change.

The omicron concerns come at a time when the crew change crisis had been easing, with latest data showing fewer seafarers have been working onboard vessels beyond the expiry of their contract in recent weeks.

December 2: Vancouver Port Trucker Strike Averted as Union Reaches Deal with Second Carrier – American Shipper

A strike by container truckers at a carrier serving the Port of Vancouver has been averted after their union reached a last-minute agreement with their company on December 2.

Prudential Transportation signed a tentative agreement less than a day before around 120 drivers were set to begin their strike, the truckers’ union, Unifor, said. It followed a similar agreement reached by another carrier serving the port, Aheer Transportation, on November 30.

December 3: Maersk Forwarder Clients Left in Limbo as Carrier Restricts Them to Spot Deals – The Loadstar

Maersk’s forwarding and NVOCC customers are being targeted by competitor lines as the Danish carrier prepares to restrict their bookings to its online Maersk Spot platform next year.

Meanwhile, container spot rate indices, the bedrock for the Maersk platform, are bucking the usual slack season trend and holding steady at highly elevated levels.

A UK-based NVOCC said his Maersk rep had admitted he could no longer offer him a three-month deal from Asia to North Europe, and that he would now have to book online, via Maersk Spot, to cover any short-term space requirements.

However, the NVOCC was assured by the rep that he could still discuss a longer-term contract with Maersk, due to the forwarder’s reliable volume.

December 6: Surcharges Widespread amid Equipment Shortages, Congestion – Hellenic Shipping News

All-inclusive trans-Pacific container shipping rates to North America strengthened in the week ended December 3, as shortages of equipment and carrying capacity in North Asia worsened amid steady demand from cargo loaders.

A Canadian freight forwarder said demand from retailers restocking ahead of Lunar New Year is a normal seasonal trend that has been exacerbated by the difficulty in returning empty containers to Asian export hubs, particularly from the West Coast of North America. The Los Angeles/Long Beach port complex has been inundated with record volumes of boxes coming in and out for months, while the Port of Vancouver is struggling to resume normal operations since rail networks to the port were washed out by floods in mid-November.

“We were already in a crisis and now it’s become even worse,” the Vancouver-based freight forwarder said. “There is so much rail cargo in terminals that they can barely unload any ships. It will be months before we dig out of this hole.”

December 8: Another Lockdown at Ningbo Has Exporters on Edge – Splash

More than 300,000 people have been tested for coronavirus in a district in the port city of Ningbo, following an outbreak of the illness, detected on December 6.

The district of Zhenhai has been put on a two-week lockdown after five people tested positive for COVID-19. Early indications are that the measures taken by local authorities have yet to harm productivity at the port.

December 9: Getting Space on Ships Next Year the Biggest Worry for the Logistics Sector – The Loadstar

Securing space on containerships is viewed as the biggest challenge for the logistics sector going into 2022, according to an industry survey.

A poll of 800 logistics companies by Container xChange reveals that, for 53% of respondents, finding slots on vessels is by far the biggest concern, followed by carrier surcharges, at 22%, and labour shortages, at 19%.

“The survey results indicate that the industry is expecting gloomy times for container logistics,” says the report.

Container xChange said the industry is “downbeat” on the expected performance of the supply chain next year, with 54% of respondents expecting it to remain as bad, and 11% suggesting it will deteriorate further.

December 13: About that Rate Relief … Ocean Shipping Costs Are Rising Again – American Shipper

The container shipping market calls to mind a famous Mark Twain misquote: “Reports of my death have been greatly exaggerated.”

The historic rate boom appears alive and well – bad news for cargo shippers and good news for container shipping investors.

There was a dip in spot prices over recent months from stratospherically high levels, but downward momentum did not hold. In several trade lanes, including Asia-to-U.S., rates are now gravitating upward yet again.

December 15: Port Klang and Piraeus Join Ningbo and LA at the Top of the Congestion Charts – Splash

To familiar congestion names Shanghai, Ningbo, Los Angeles and Long Beach, other ports such as Piraeus in Greece and Port Klang in Malaysia can now be added.

The global container port congestion crisis that has racked supply chains all year is shifting to new hot spots while some older problem places get back on track.

Data from Danish liner consultancy eeSea shows the worst areas where ships are backing up, as well as improvements at previous sore points, such as Savannah on the U.S. east coast. Along with the familiar bubbles bulging out from east China and southern California, the congestion bubble map (see article) shows growing issues mounting in the Mediterranean and along the African coastline.

December 16: Port Congestion Causes Carriers to Blank up to Quarter of TEU Capacity – The Maritime Executive

A new phenomenon is emerging in container shipping as the major carriers struggle to manage their schedules in light of the persistent backlogs to enter major ports around the world. Research and advisory services company Sea-Intelligence is calling it “congestion-induced blank sailings,” where the carriers have been forced to blank sailings from their schedule not because of overcapacity but because the ships are not returning in time due to port congestion.

The largest impact is currently on the Asia-North America West Coast trade routes where Sea-Intelligence reports as much as a quarter of weekly capacity is blanked due to the delays throughout the system.

December 17: Tough Contract Talks Loom for Shippers ‘Gobsmacked’ by Rate Increases – The Loadstar

With capacity remaining extremely tight ahead of Chinese New Year, shippers are bracing for a further wave of rate increases on container trades out of Asia.

The Loadstar understands that carriers are preparing to roll out GRIs (general rate increases) and FAK (freight all kinds) hikes of up to $1,000 per 40ft across Asia-Europe and transpacific routes from January 1 and, in some cases, reintroduce equipment and space guarantee premium fees.

And, in more unwelcome news for shippers, oil price hikes this quarter will trigger carrier bunker surcharge formula upgrades from January 1, with, for example, CMA CGM resetting its Asia-North Europe BAF for Q1 22 at $345 per TEU.

December 20: Vancouver Fraser Port Authority Notice of Update for GIF2022

The Vancouver Fraser Port Authority has issued an update regarding the implementation of the Gateway Infrastructure Fee 2022 (GIF2022).

December 20: CLECAT Cites European Competition Law as Major Shipping Lines Seek to Sideline Forwarders – Lloyd’s Loading List

There is some real concern that forwarders will no longer find space for their cargo in the new Maersk structure unless they venture into the less-favourable spot market, according to CLECAT, the organization representing European forwarders.

Maersk and Hamburg Sud are not only refusing contracts from forwarders; on top of this they are approaching the very customers of those forwarders whose business they are now rejecting, CLECAT explained.

The two lines have announced that they will cease to provide services to certain freight forwarders from January 1, 2022 through named account contracts.

 

Air

December 7: Grim Picture for Shippers, with No Relief from Elevated Air Freight Rates in Sight – The Loadstar

Shippers hoping for relief in air freight rates early next year can expect to be disappointed, according to consultants and analysts.

A host of factors, including the Omicrom variant and its likely impact on belly capacity and lockdowns, spurring spending on goods rather than services, as well as a shortage of labour, could see pricing remain high.

December 10: China Cabin Cargo Ban Will Add to Pressure on Air Capacity and Freight Rates – The Loadstar

Cargo in aircraft passenger cabins will no longer be accepted by China in the new year – a move expected to keep air freight rates high.

China’s Civil Aviation Administration (CAAC) said “only anti-epidemic-related items are allowed to be loaded in the cabin.”

The authority acknowledged this will lead to additional pressure on the market.

“This new regulation will further reduce air cargo capacity and aggravate the current air capacity shortage. The superimposed fuel price is still high,” it said.

“On the other hand, the tightness of air transport capacity may lead to part of the demand for air transport being transferred to shipping, leading to a further increase in shipping rates and, overall, freight prices are expected to continue to rise.”

December 17: Air Freight Rates Soar to New Record Highs – Lloyd’s Loading List

Ex-Asia air freight rates have soared again to new record highs, especially on the transpacific where average Shanghai to North America spot prices reached almost $16 per kilo this week amid “unprecedented market momentum.”

The latest pricing from the Baltic Exchange’s Baltic Air Freight Index (BAI) indicates that average spot prices from Shanghai (PVG) to North America were at US$15.92 per kilo this week, rising from the already extremely high levels of US$14 per kilo last week, with Hong Kong-North America average spot prices exceeding $14 per kilo this week, up from $12 per kilo since the second half of November.

 

Rail

December 14: CP, KCS Await Federal Approval of Now-Complete Merger – FreightWaves

Canadian Pacific has formally completed its acquisition of Kansas City Southern, and both are now waiting for the Surface Transportation Board to approve their merger.

The merger’s value is worth approximately US$31 billion. KCS stockholders will receive 2.884 CP common shares and US$90 in cash for each share of KCS common stock held and US$37.50 in cash for each share of KCS preferred stock held.

With the acquisition complete, the shares of KCS are being placed in a voting trust. CP says the trust, which is being used as part of the process to acquire KCS, ensures that KCS will operate independently of CP until the Surface Transportation Board approves CP’s merger application.

 

Trucking

December 15: Loads Surge, Capacity Tightens on Canadian Spot Market – Today’s Trucking

The Canadian spot market reached all-time high load volumes for November, according to the latest data from Loadlink Technologies.

Volumes accelerated through the month, Loadlink reports, bucking historic trends that tend to see load volumes slow near the end of the calendar year.

Loads were up 69% year over year, and up 32% from October.

“These past few months have shown a clear sign that even through all of the uncertainty that the pandemic continues to cast, along with the bottlenecks within the supply chain, the spike in demand remains strong,” says Claudia Milicevic, president of Loadlink Technologies.

December 16: White House Looks to Boost U.S. Trucking Industry – Reuters

The Biden administration is meeting with the trucking industry as it looks to help add new drivers to a key part of U.S. supply chains.

The White House says COVID-19 “exacerbated longstanding workforce challenges in the trucking industry, including high turnover rates, an aging workforce, long hours away from home, and time spent waiting.”

Transportation Secretary Pete Buttigieg and Labour Secretary Marty Walsh will join National Economic Council Director Brian Deese in hosting a roundtable at the White House with leaders in the trucking industry, including business and labour leaders.

December 17: Senators Ask Biden to Exempt North American Truckers from Border Vaccine Mandate – Canadian Trucking Alliance

Fourteen Republican U.S. senators have asked President Joe Biden to exempt Canadian truck drivers who cross the U.S.-Canada border from a fast-approaching vaccine mandate for foreign essential workers in January, saying the requirement will disrupt the North American supply chain.

Their letter also called on the Biden administration to work with the Canadian government to exempt truckers from that country’s reciprocal vaccine requirement — also taking effect in January.

 

CIFFA Advocacy, Communications, Activities

December 13: Joint Statement by Canadian Business Associations, Including CIFFA, on Supply Chain Bottlenecks

A statement signed by 34 Canadian business associations, including CIFFA, was issued on December 13 to draw attention to “a supply chain that is not functioning.” The organizations are seeking “urgent action” in several areas, as follows.

The statement reads:

Vaccination rules for truck drivers

Canadian businesses continue to support vaccinations as a critical tool in the fight against COVID. However, given current vaccination rates amongst truckers, the January 15th Canadian deadline for truckers to be vaccinated to cross the border poses serious risks for the resilience of our supply chain. It will also seriously aggravate the existing truck driver shortage and lead to price increases that will hurt the Canadian economy and consumers.

We call on the government to delay the deadline for mandatory vaccination and work with businesses to find a revised timeline that minimizes supply chain impacts.

Government of Canada – business task force on supply chains

Shipping container backlogs, labour shortages at various points of the supply chain, and extreme weather disasters are continuing to strain supply chains. While the remedies involve both short and long-term solutions, it is a complex situation. Partnership and dialogue between government and the private sector are critical to work through these complexities.

We call on the government to establish a joint task force with business leaders to identify and implement solutions that can increase supply chain resilience.  

Protecting the business environment

As the engines of job creation and economic growth, businesses need to be able to operate within a competitive environment. However, lingering challenges remain over increased regulation that may hurt growth.

We call on the government to delay the implementation of any non-essential regulations that would strain the supply chain. 

 

Our associations stand ready to work with the government to address these issues with the urgency necessary to ensure we successfully navigate through this recovery period and into a period of economic growth.

 

Special Section – B.C. Floods

November 16: Port of Vancouver Operations Update

Rail and road operations servicing the Port of Vancouver are heavily impacted by recent flooding in British Columbia.

All rail service coming to and from the Port of Vancouver is halted because of flooding in the B.C. interior. Both CN and CP Rail indicate that no rail traffic is currently able to transit between Kamloops and Vancouver. Both rail lines are conducting damage assessments of multiple impacted sites and infrastructure threats to establish access and repair activities required. A time frame for reopening of the rail lines will be known once damage assessments are complete.

Vessel delays and heightened anchorage demand are expected due to disruptions to terminal operations. The port is working with terminal operators, railways and all levels of government to understand the impacts of these delays on terminal operations and to develop a recovery plan.

Flooding has also caused numerous highway closures due to washouts and landslide debris throughout southwestern B.C., including all main routes to the Metro Vancouver and Fraser Valley regions. Damage to roadway infrastructure is currently being assessed.

November 17: Port of Vancouver Operations Update

Transport Canada is working closely with emergency services to assess infrastructure damage to impacted areas. Damage assessments have been hindered by logistical and safety concerns due to evacuation orders issued in multiple communities.

November 17: Yang Ming ‘Stops the Clock’ in Vancouver

In an advisory sent to customers, Yang Ming said it will “stop the detention clock for all import cargo destined Vancouver from November 1st, 2021 to November 30th, 2021.”

November 18: Port of Vancouver Operations Update

British Columbia’s Minister of Public Safety Mike Farnworth declared a provincial state of emergency effective November 17. The state of emergency applies to the entire province for an initial 14-day period and may be extended or rescinded as conditions require. The state of emergency enables federal, provincial and local governments to allocate resources and deliver a coordinated response to protect the public, mitigate impacts on transportation networks and movement of essential goods and supplies, and to support the province-wide response and recovery.

All highways remain closed to non-essential traffic as work crews continue with reconstruction and repairs. Damage assessments of roadway infrastructure are ongoing.

November 19: Port of Vancouver Operations Update

Trucks are operating under normal conditions at all four container terminals.

Intermittent openings of one highway route are allowing some commercial vehicles to transit westbound from Hope towards Vancouver.

November 19: CBSA Issues Emergency Protocols in Response to Flood Situation in British Columbia

Due to extreme weather conditions in British Columbia that have caused flooding, landslides, road closures and other supply chain disruptions, Canadian domestic truck carriers may need to transit through the U.S. to reach destinations in Canada. Read guidelines issued by CBSA.

November 22: Port of Vancouver Operations Update

CN and CP crews and engineering teams continue to make significant progress clearing debris and undertaking repairs to damaged rail infrastructure between Kamloops and Vancouver.

Anchorage demand is high and nearing capacity across all vessel types.

November 22: CBSA and CBP Joint Updated Emergency Protocols in Response to Flood Situation in B.C.

The CBSA and U.S. CBP have jointly issued updated emergency protocols.

November 22: Hours of Service Relief Available in B.C. Flood’s Aftermath – Today’s Trucking

Federally regulated carriers that are helping with B.C. flood relief will have access to a temporary hours-of-service exemption.

The exemption, outlined in Targeted Essential Freight Transport Exemption to Support the Emergency Response to the Flooding in British Columbia, is designed to help federally regulated carriers and their drivers who are moving essential supplies and equipment for relief efforts, the Canadian Trucking Alliance (CTA) reports.

The relief specifically applies to Sections 12-29 of the Hours of Service regulations. But other rules remain in place, such as requirements to monitor and manage fatigue, keep daily logbooks and maintain records.

“There are also several conditions that must be met prior to and during the use of the exemption that carriers are strongly encouraged to review,” CTA adds.

November 24: Port of Vancouver Operations Update

Four trains have transited across CP’s mainline between Vancouver and Kamloops. All trains are operating in accordance with low-speed restrictions to enable monitoring of rail infrastructure in recently repaired areas. Intermittent closures to address repairs and ensure safe operations may occur.

Truck operations at all four container terminals remain steady. Reconstruction and repairs continue on major roadways across the region, with some highway routes restored, including detours, intermittent closures and essential-traffic-only restrictions.

November 24: FMCSA Provides Additional Regulatory Exemptions to Canadian Carriers in Aftermath of B.C. Flooding – Canadian Trucking Alliance press release

The U.S. Federal Motor Carrier Safety Administration (FMCSA) has issued a regional emergency declaration to facilitate movement of Canadian goods through the United States to bypass road closures and areas in Canada cut off by flooding and landslides.

This declaration complements recent changes made to the U.S. Customs and Border Protection in-transit program and will allow additional options for Canadian carriers and drivers in re-establishing key supply chain links to British Columbia and Western Canada.

The declaration provides an exemption from certain regulatory requirements in the Federal Motor Carrier Safety Regulations and is limited to Canadian motor carriers and drivers providing emergency services or transporting essential goods, supplies and equipment from Canada to other points in Canada to bypass road closures and areas in Canada cut off by flooding and landslides.

November 25: Port of Vancouver Operations Update

The Government of Canada and the Vancouver Fraser Port Authority are undertaking a joint initiative to provide additional container storage capacity to ease supply chain constraints and bottlenecks in the Lower Mainland areas exacerbated by extreme weather disruptions. The project includes preparation of a 40-acre site within the Fraser Richmond industrial lands for the temporary handling and storage of empty containers. Work to prepare the site for storage services and contract an operator will occur over the coming weeks. The site is expected to be used until service levels return to pre-flood conditions.

CP is implementing its operational plan to process the backlog of trains waiting to transit between Vancouver and Kamloops. Both CP and CN trains will operate on the restored line and transit in accordance with low-speed restrictions to enable monitoring of rail infrastructure.

November 28: Port of Vancouver Operations Update

Ongoing precipitation across southwestern B.C. has caused the closures of rail lines and highway routes servicing the West Coast.

CP’s mainline between Kamloops and Vancouver is closed to enable engineering teams to conduct inspections and undertake repairs to stabilize sites impacted by rainfall. No new washouts have been reported. CN operated numerous trains over its mainline in the last 24 hours, but it has ceased operations to enable inspections and address ongoing water concerns.

The Ministry of Transportation and Infrastructure proactively closed highways previously impacted by flooding and landslides due to worsening weather.

Demand for anchorages currently exceeds capacity.

November 29: Port of Vancouver Operations Update

Both CP and CN eastbound and westbound trains are operating on CP’s mainline between Vancouver and Kamloops. Enhanced rail infrastructure inspections and maintenance by engineering teams and track patrols are ongoing. CN operated multiple trains on its rail line through the Fraser Canyon corridor over the weekend. It halted operations through a site impacted by heavy precipitation to undertake repairs.

With the exception of emergency travel, highways through the Fraser Canyon remain closed due to continuing rainfall in the area.

November 30: Port of Vancouver Operations Update

The provincial state of emergency declared by the B.C. Minister of Public Safety has been extended to December 14.

Restored highway routes include detours, intermittent closures and essential-traffic-only restrictions. Proactive closures may occur when heavy rainfall is forecast.

November 30: CN Calls a Halt to Reopening in B.C. – Inside Logistics

Flooding in southern B.C. continues to present logistical challenges for exporters as Canadian National Railway Co. shut its service along the key freight corridor because of heavy precipitation, and traffic is moving slowly through the Port of Vancouver.

“The recovery of the manufacturing sector in general has slowed down and the crisis in B.C. is just going to make it worse,” said Dennis Darby, president of Canadian Manufacturers & Exporters.

He said trains were running at very low rates even before the Montreal-based railway pulled the plug on its reopening efforts.

“We hope … that this gets back to normal as soon as possible, but it’s going to take weeks at least, months probably.”

CN said it moved seven trains during the weekend but decided to “proactively close its network” because rain was causing increased debris, washout and landslide activity.

“Our crews are working to find safe and effective ways of managing the waterflow, stabilizing the infrastructure and monitoring the overall state of the network,” railway spokesman Mathieu Gaudreault wrote in an email.

 

 

Maritime

November 3: Tough Renewed Anti-COVID Measures Limit Chinese Seafarer Availability – Splash

Chinese seafarers, among the world’s largest resources of crew, are facing renewed severe hurdles to get on and off ships, in the latest battle shipping is facing in the ongoing crew change crisis.

The Global Maritime Forum is reporting that many shipmanager members are struggling with the onboarding and repatriation of Chinese seafarers due to stricter Chinese government isolation requirements on seafarers post sign off and prior to repatriation.

November 5: Spot Rates Continue to Slide, but Premium Surcharges Continue to Pile Up – The Loadstar

Container spot rates from Asia to Europe continued their downward trend last week from their September all-time highs, while transpacific base rates also lost significant ground.

The November 5 Ningbo Containerized Freight Index (NCFI) commentary reports that the market from Asia to North Europe and the Mediterranean is “sluggish.” “Some carriers have increased their efforts to solicit cargo, which led to a slight drop in spot freight rates,” it said.

While the decline is not dramatic, it appears some carriers are reducing, or waiving, premium fees that can easily add $3,000 or more to the final invoice. Indeed, one UK-based NVOCC said his carrier was prepared to “throw in” its equipment and space guarantee fees during November.

Drewry’s WCI reading for Asia to the U.S., which excludes premium fees, slumped 10% for west coast ports last week, to $9,857 per 40ft, and for east coast ports fell by 7%, to $12,667 per 40ft.

In contrast, the FBX Asia-U.S. west coast component, which includes premium fees, was up 1%, to $18,730 per 40ft, while for east coast ports, the spot rate slipped 2%, to $19,895 per 40ft.

November 12: Port of Montreal Sets Late 2026 as New Target Date for Planned Contrecoeur Container Terminal – American Journal of Transportation

At a recent technical briefing, the Port of Montreal updated the procurement process that national or international consortiums need to follow in seeking to partner with Canada’s second largest maritime gateway in its biggest project in decades: establishing a sixth container terminal. If all goes according to plan, a revised tentative timeline marks the scheduled operational date for late 2026 versus 2025 for the container terminal at Contrecoeur, 25 miles downstream on the St. Lawrence River, where there is already bulk shipping activity.

Upon completion, the terminal able to handle 1.15 million TEUs will boost the port’s capacity from 2.1 million TEUs to 3.5 million TEUs. Construction is planned to begin in 2023.

November 12: China’s Northern Port of Dalian Begins New COVID-Related Lockdowns – The Maritime Executive

The northeastern port city of Dalian in China is beginning a third round of lockdowns and quarantine as the city has been linked to a new wave of the Delta variant of COVID-19. Health officials have begun closing non-essential businesses, including at least parts of the port operation. Residents have been ordered to remain at home except for essential travel, as mass testing and sanitation regimes are again introduced in the city.

November 29: Feeder Operators to Wind Down Across the Pearl River Delta for Six Weeks Ahead of Chinese New Year – Splash

The latest curveball likely to have a sizeable impact on global supply chains comes from south China, one of the most important manufacturing powerhouses in the world, where new COVID constraints are coming in at many local ports.

Both Ocean Network Express (ONE) and Hapag-Lloyd have warned that many feeder operators will suspend services from late December until mid-February due to strict COVID quarantine rules for crews, threatening the ability of local seafarers to get home in time for Chinese New Year.

“Due to the COVID-19 quarantine requirements for the crews of the coastal feeders running between South China and Hong Kong waters, feeder operators announced their services will be suspended for a minimum of 6 weeks prior to Lunar New Year 2022, which is Feb. 1-5, 2022. In consideration of this situation, ONE will temporarily suspend the acceptance of the cargo bound for the ports in the South China area that require usage of the domestic feeders to reach the final destination. Any cargo to South China that can be serviced by an ocean vessel is not affected,” ONE stated in an advisory last week.

“This will not directly impact cargo moving directly to/from the major deep-sea ports, but can give rise to a number of ripple effects,” explained Lars Jensen, founder of container advisory Vespucci Maritime, in an update on LinkedIn, suggesting that cargo to and from the smaller ports in south China might see an earlier pre-lunar new year surge than usual.

 

 

Air

November 2: Maersk Targets Air Cargo with Senator Acquisition and Freighter Order – Air Cargo News

A.P. Møller – Mærsk is expanding into the air cargo market with the acquisition of freight forwarder Senator International and the addition of five freighters.

The company said it intends to acquire Senator International to “accelerate its product offering which integrates Logistics, Ocean, Rail and Air and expand its global air network.”

November 3: Air Freight Rates Rising as Peak Season Looms, but Flights Aren’t Full Yet – The Loadstar

Air freight is getting more expensive – but all flights aren’t full, signalling that demand is not yet as strong as expected.

According to the latest figures from Clive Data Services, capacity in October was 17% higher than a year earlier, while the dynamic load factor was 3 percentage points down, at 68%, although it rose 2 percentage points from September.

Rates, however, were 37% higher than a year earlier, but Clive noted that there were “significant market performance deviations.”

November 11: Air Freight Handling Stressed at Multiple Airports – Lloyd’s Loading List

Sustained high demand, diminished capacity, COVID-safe work practices and apparent labour shortages continue to place immense pressure on global air freight hubs, creating congestion at multiple airports around the world.

UK freight agent Metro Shipping said that, “while there are different situations at different airports, the demand for air cargo is exceptionally high and ground-handling operations are proving to be consistently ineffective at servicing the upturn in freighters, and passenger freighters, with particular problems at Heathrow, Amsterdam, Brussels, Frankfurt and Liege. And that’s just in Europe.”

November 23: Cost-Hit Air Cargo Handlers Warn of Double-Digit Rise in Charges – The Loadstar

Robert Fordree, Executive VP, Cargo, for Menzies, warned that forwarders can expect to see a double-digit rise in air cargo terminal handling charges (THCs) next year, as the sector struggles with rising costs.

“It’s in part a reaction to not having a COVID surcharge, while the cost base [is] increasing and we can’t flex rates up and down. And the labour market is not going to fix itself any time soon.”

 

 

Rail

November 23: Surface Transportation Board Accepts CP-KCS Merger Application as Complete, Sets Procedural Schedule – CP press release

Canadian Pacific Railway Limited and Kansas City Southern yesterday announced that the Surface Transportation Board has accepted the joint CP-KCS merger application as complete.

In the same decision, the Board also set a procedural schedule for the regulatory review that calls for final briefs on July 1, 2022. CP and KCS anticipate that the STB review of CP’s proposed control of KCS will be completed in the fourth quarter of 2022.

 

November 26: Mexican Regulators Approve CP-KCS Merger – FreightWaves

The Mexican Federal Economic Competition Commission and the Mexican Federal Telecommunications Institute have given regulatory approval of the proposed merger between Canadian Pacific and Kansas City Southern, both companies announced Friday.

CP and KCS needed approval from Mexican regulators because KCS has operations in Mexico.

“This important milestone marks the next step on our path to creating the first single-line rail network linking the U.S., Mexico and Canada,” said CP President and CEO Keith Creel in a statement.

 

 

Trucking

November 30: Two B.C. Container Fleets Face Strike Action by December 3 – Today’s Trucking

Truck drivers with two fleets that serve the Port of Vancouver could go on strike as soon as December 3, adding to supply chain disruptions in B.C.

Unifor has issued 72 hours’ notice of the strike, following a vote by container truck drivers at Aheer and Prudential Transportation. They’re looking for the fleets to adopt a pattern collective agreement reached in August with Harbour Link Transportation.

The two fleets represent 170 trucks, or about 10% of the container trucks serving the Port of Vancouver.

November 30: Vancouver Port Truckers Reach Deal with 1 Carrier after Calling Strike – American Shipper

Truckers at one of two Port of Vancouver carriers facing a strike have reached a tentative agreement, their union said on Tuesday.

Aheer Transportation signed the agreement a day after Unifor issued a 72-hour strike notice. However, about 120 drivers at Prudential Transportation still plan to begin a strike on Friday.

Aheer signed a tentative pattern agreement similar to others that Unifor has reached with the Vancouver port trucking companies.

 

 

CIFFA Advocacy, Communications, Activities

November 4: Welcome Letters Sent by CIFFA to Ministers of Transport and Public Safety

CIFFA sent letters of congratulations to several federal ministers on their portfolios in Cabinet, welcoming them to their roles and indicating we are keen to work together on advancing our advocacy goals in transportation and supply chain. Those goals are outlined in CIFFA’s election issues briefing note, Critical Issues in Transportation Affecting Canada’s Recovery, which is included with each of the letters.

November 5: New Industry and Membership News Section on CIFFA Website

CIFFA is now posting member news from press releases on The Forwarder page of the website.

November 10: Open Guarantee Letter of Payment Posted in CIFFA Resources

The Guarantee Letter is preferred to ensure payment for delayed pick-up of containers, resulting in demurrage, detention, damage or other related storage charges. A copy is now available on the CIFFA Resources page.

November 19: CIFFA Sustainability Survey: What Goals are Important to Your Organization?

CIFFA, via its Sustainability Committee, is asking members to provide ideas and input on some of the goals/tools/initiatives your companies have set up to become more sustainable.

Nowadays, sustainability is very much a part of the strategic priorities of many organizations. CIFFA is interested in why sustainability matters, what areas are being worked on and what barriers exist to implementing sustainable initiatives.

 

Maritime

October 1: Port of Vancouver ‘Gridlock’

A CIFFA freight forwarder member provided an update on the Port of Vancouver, as follows:

“Congestion and delays are now severely impacting the Port of Vancouver’s operations. Increased demand to Vancouver by forwarders looking to bypass the congestion occurring at U.S. West Coast ports has resulted in increased vessel delays, bunching and an increase in overall volume, as well as the challenges of returning empty containers, creating an overall chassis shortage. This has dramatically increased the demand on the ports, warehouses, and local drayage carriers throughout the Lower Mainland of British Columbia.

“Every trucking company involved in container drayage is overbooked and not able to handle their current orders. Ocean carriers are also making it difficult for the truckers to return empty containers at off-dock terminals. This is resulting in chassis being tied up with empty equipment.”

October 1: Agreements ‘Being Ripped Up’ by Lines as Shippers are Left in the Dark on Rates – The Loadstar

Customer service has effectively been shelved by the shipping lines, as shippers grumble that it is getting increasingly difficult to book cargo with them, let alone know what rate they will be charged.

Many complain that carriers are refusing to answer booking desk phones, and are “ignoring” e-mails.

“We spend hours trying to contact the lines and they just let their phones ring out,” one frustrated director of an NVOCC said.

“It’s demoralizing for our staff – to whom we preach the gospel of customer service daily – that they cannot give a sensible answer to clients,” he said.

And despite what the carriers say publicly, they are “not interested” in talking about signing new contracts until after the Chinese New Year holiday in February, when the lines believe they might start to need to ask shippers for cargo.

October 4: Delays Soak Up More than a Tenth of Boxship Capacity – Lloyd’s Loading List

Containership capacity equivalent to 12.5% of the global fleet is unavailable due to delays caused by congestion in ports, despite the huge increase in the amount of deployed tonnage.

An analysis of vessel delays and capacity deployments by Sea-Intelligence showed that the amount of additional capacity required to meet demand is being outstripped by the amount of capacity being held up out of service as it awaits berthing slots.

October 5: Bunker Surcharges Resurface – ‘Justified by Oil Price Spike’, Say Carriers – The Loadstar

As oil prices spike to multi-year highs of $80 a barrel, ocean carriers are preparing to dust off their bunker surcharge mechanisms to mitigate the impact.

Although several carriers, including CMA CGM and Hapag-Lloyd, have capped further FAK rate increases, surcharges were specifically excluded from their rate moratoriums.

Rotterdam-sourced LSFO (low-sulphur fuel oil) increased a further $4 on October 4, to $560 a tonne, having jumped 20% since the end of August.

This increase alone will add over half a million dollars of cost to an Asia-North Europe round trip, and carriers seem to believe that, despite the currently high freight rates, they must take action to keep their costs in check.

October 6: Transpacific Rates at a Two-Month Low, as Congestion Grows on East Coast – American Journal of Transportation

With production in China slowed during the Golden Week holiday and by power restrictions in some areas, and with ocean delays making it increasingly unlikely that shipments not already moving will make it in time for the holidays, transpacific ocean rates stayed level this week after a significant drop a week ago. But rising oil prices could mean that carriers will increase fuel surcharges at the end of the month pushing rates back up.

Despite the current drop, worsening port congestion and delays at LA/Long Beach are still keeping Asia-U.S. prices extremely high, at more than quadruple their level a year ago. The congestion – as well as the sky-high value of an empty container back in Asia – may also be responsible for pushing North America-Asia export rates up more than 10% this week to more than $1,000/FEU from both coasts.

October 11: ‘Canada’s Supply Chain Is at Risk’ Warning, as Congestion Hits Port of Vancouver – The Loadstar

The brakes have been applied hard on traffic flows at the port of Vancouver.

In a matter of weeks, the port has gone from a relatively fluid situation to serious congestion that has raised alarms that retailers could miss out in the peak shopping season.

October 15: Containership Traffic Jam in Southeast Asia Worst Since April – Transport Topics

Typhoon Kompasu has resulted in the worst container shipping traffic jam in months, one that now stretches throughout Southeast Asia and may take weeks to unravel.

Although port operations are largely back to normal in Shenzhen and Hong Kong after the tropical storm’s passing, the total containership count off the two vital hubs had ballooned to 271 as of early October 15, the highest count recorded since Bloomberg News started tracking the data in April.

October 18: Box Rate Difference Between Smaller and Large Shippers Approaching $20,000 per FEU – Splash

The crippling container shipping costs hitting smaller shippers has been analyzed by Danish consultancy Sea-Intelligence, clearly illustrating why so many exporters are skirting with bankruptcy thanks to this year’s record freight rates.

The price differential between smaller shippers using spot cargo and larger shippers on contract continues to escalate. The gap was $10,000 per FEU four months ago but is now approaching $20,000.

October 22: Maersk’s Forwarder Move Could Be Abuse of Its Dominant Position, Says Clecat – The Loadstar

Expectations that one of the world’s major container carriers will not offer services to some customers, including some freight forwarders, could be seen as an abuse of its dominant market position and a denial of service, says the European Association for Forwarding, Transport, Logistics and Customs Services (Clecat).

“The [ocean] alliances’ market share is very large; it is a concentrated market now [and] they have market power,” said Clecat director general Nicolette van der Jagt.

“I wonder to what extent this is an abuse of their dominant position? We will look at it and see if we can challenge this with the European Commission.”

October 26: Long Beach/Los Angeles Ports Announce New Measure to Clear Cargo – Lloyd’s Loading List

The ports of Long Beach and Los Angeles are to introduce a surcharge for import containers that dwell on marine terminals in a bid to improve cargo movement amid congestion and record volume.

Under the new policy, the ports will charge ocean carriers for each container that falls into one of two categories. In the case of containers scheduled to move by truck, ocean carriers will be charged for every container dwelling nine days or more. For containers moving by rail, ocean carriers will be charged if the container has dwelled for three days or more.

Beginning November 1, the ports will charge ocean carriers with cargo in those two categories $100 per container, increasing in $100 increments per container per day.

October 27: Ocean Carriers Will Pass on Port Fines for Lingering Containers to Importers – American Shipper

Logistics industry professionals say retailers and other cargo owners will ultimately bear the cost of drastic new fees announced on October 25 by the ports of Los Angeles and Long Beach in response to mounting congestion disrupting the entire U.S. economy.

The fees ostensibly penalize ocean carriers for not quickly clearing out imported containers piling up in their terminals, but a lack of details in the press release left freight industry stakeholders confused about how the rules will be applied.

Within minutes of the announcement by the twin ports, container lines began sending letters to importers alerting them to be prepared for the new charges, said Matt Schrap, CEO of the Harbor Trucking Association.

“So clearly, they are not just absorbing these costs as a part of doing business to get this cargo out. They are passing these costs on to the beneficial cargo owner, which as we all know, goes right into the American consumer’s bottom line,” he said.

October 27: Maersk Rejects ‘Cutting Out Forwarders’ Claim – Lloyd’s Loading List

Maersk has rejected claims made in a recent media report that it looks set to handle cargo only from direct shippers from November 1, cutting out forwarders.

The Danish shipping giant said it had issued the following statement in response to the report: “Forwarders have been, are and continue to be one of the biggest customer groups we have on our ships.”

October 27: New Report Highlights Growing Risk of Seafarer Exodus – Splash

The Seafarers Happiness Index report from The Mission to Seafarers has been published for the third quarter of 2021, carrying an important message about the risks of an exodus from the industry.

The survey suggests that COVID-19-related strains on seafarers are beginning to ease, and support measures for seafarer welfare have now had a chance to take effect, yet challenges with shore leave and ship-shore connectivity remain.

The challenges of balancing home life with the uncertainties of the crew-change crisis have led many who were tentatively considering a move ashore to accelerate their career-change plans. The report emphasizes that many seafarers are not intending to return to sea once they eventually get home.

The issue of retention in an already stressed workforce is a major concern. There is likely to be a growing shortfall in seafarers in the coming years, with seemingly little or no coherent mechanism to manage the problems coming over the horizon.

 

 

Air

October 13: Superhot Airfreight Market Leaves Shippers in the Cold – American Shipper

Importers and exporters should brace for the pandemonium roiling the ocean freight sector – where container shipping delays and prices are at all-time highs – to wash over the air cargo market this month.

Full planes and skyrocketing freight rates are signs the market has tightened to the point that shippers will be hard-pressed to find air transport for their goods as holiday-season shipping enters the stretch run, according to market analysts and logistics specialists.

Welcome to the super-peak season.

October 14: Airfreight Capacity Predicted to Tighten in Coming Weeks – Lloyd’s Loading List

Airfreight capacity looks set to tighten further in the coming weeks as demand continues its upward trend for the looming peak season.

Niall van de Wouw, managing director at air cargo industry analysis firm CLIVE Data Services, said: “It might get pretty messy soon if this climbing load factor continues for the next few weeks. At the moment we see no reason why it would not, and things tend to get a bit stronger towards the end of the year. We still see very little relief from a capacity point of view.”

 

 

Rail

October 19: CN Rail Launches Global Search for New CEO as Ruest Plans Exit – BNN Bloomberg

Canadian National Railway Co. said CEO Jean-Jacques Ruest plans to retire by the end of January.

The surprise announcement comes one day after TCI Fund Management Ltd., CN’s second largest holder, released a presentation on its plans for change at the railway. TCI argues that CN must “urgently” take measures to improve efficiency and profitability.

In a conference call, Ruest said the board is searching for the best possible replacement for him. “They’re not on the clock. It doesn’t mean they will go slow,” he said. “I am staying until the end of January or whenever is required to do a smooth transition. At this point, we are looking for quality and sometimes quality takes a little time.”

 

 

Trucking

October 12: Canada Short 18,000 Truck Drivers in Second Quarter: Survey – Today’s Trucking

About 18,000 of Canada’s truck driving jobs were vacant in the second quarter of 2021, leaving 72% of surveyed employers to identify driver recruitment as a significant business challenge.

These results emerged with the release of Trucking HR Canada’s latest labour market information update.

While the number of vacancies is expected to ease somewhat after 2021, Trucking HR Canada projects the industry will annually face 17,230 truck driver vacancies in coming years.

October 25: U.S. Driver Shortage Worse than Ever: ATA – Today’s Trucking

The U.S. trucking industry is short about 80,000 drivers today – an all-time high – and if current trends continue, will be short 160,000 drivers by 2030.

The figures come from the latest analysis by the American Trucking Associations (ATA). ATA chief economist Bob Costello said the numbers should come as a warning that the supply chain issues seen today could be permanent in the future due solely to a lack of drivers.

 

 

CIFFA Advocacy, Communications, Activities

October 1: CIFFA Asks Prime Minister Justin Trudeau to Create Task Force to Look at Measures to Relieve Pressures on Supply Chain System

On October 1, CIFFA sent a welcome letter to re-elected Prime Minister Justin Trudeau. The letter outlines CIFFA’s intent to work with the government and asks for a special task force to be appointed that will look at transportation and supply chain issues, and convene government and industry to discuss solutions to congestion, backlog and supply chain impasses.

Read the letter.

October 7: CIFFA Hosts Supply Chain Stakeholder Engagement Meeting

On October 7, CIFFA held a supply chain stakeholder engagement meeting, led by Executive Director Bruce Rodgers and Director, Policy and Communications Julia Kuzeljevich. The meeting was in response to various communications sent to CIFFA about congestion issues across the supply chain.

Rodgers stated to the stakeholders, which included marine carriers, drayage operators, forwarders, industry associations and off-dock facilities, that the intent is to work collaboratively on common solutions to improve the supply chain overall. By bringing the parties together, we aim to achieve some good results.

We need to better understand each others’ issues and impacts and work together on solutions. A further meeting will be scheduled in November to include more participants, from rail and terminals.

October 19: Press Release – Federal Leadership on Supply Chains Won’t Solve Everything, But It Might Help: CIFFA Executive Director

CIFFA issued a press release on October 19, saying:

Last week the Minister of Finance told reporters she was watching Canadian trade flows, looking for signs of “strain” but so far, didn’t see them.

This came as a shock to our membership at the Canadian International Freight Forwarders Association (CIFFA). The Canadian supply chain is experiencing “strain” as we have never seen it before. We are dealing everyday with the congestion and chaos that is snarling our ports and frustrating retailers and other customers.  Costs have doubled – or worse compared to pre-pandemic levels. Many operators are paying extraordinarily high penalties because they cannot move containers in and out of the ports in a timely manner.

So, the Finance Minister’s comment was a little like going to the doctor to be told you are not really feeling that pain. No one blames Ms. Freeland or her government for not solving all the problems. But we would certainly appreciate some effort. Doing nothing is not an effective response.

Find the press release here.

Maritime

September 8: China’s First Autonomous Boxship Readies to Enter Service – Splash

The race to develop operational autonomous vessels is intensifying, with the announcement that the AV Zhi Fei, a Chinese-built 300-TEU cargo vessel is set to enter service in October on a short-sea route between Dongjiakou and Qingdao.

September 9: Peak Season Delays Push Transpac Rates Past $20K/FEU – American Journal of Transportation

Clogged ports and peak demand combined to push Asia-U.S. West Coast rates past $20K/FEU for the first time this week. Asia-East Coast rates likewise climbed by more than 10%, as backlogs have grown in ports like Philadelphia.

Delays in European ports are contributing to rising transatlantic rates too, with Europe-N. America East Coast prices spiking 18% this week to nearly $7K/FEU, 4X a year ago, after more than two months of stability.

September 10: CMA CGM Freezes Spot Rates amid Trade Chaos – American Journal of Transportation

The world’s third-largest container carrier said it’s capping spot rates for ocean freight for the next five months, yielding to pressure from some customers and regulators concerned that global trade disruptions have pushed the cost of shipping too high.

“Although these market-driven rate increases are expected to continue in the coming months, the group has decided to put any further increases in spot freight rates on hold for all services operated under its brands,” CMA CGM SA said in a statement on its website.

The decision took effect Thursday and runs through Feb. 1. The company said it’s “prioritizing its long-term relationship with customers in the face of an unprecedented situation in the shipping industry.”

September 13: 2M Blank Sailings Resurface and Take Angry Shippers by Surprise – The Loadstar

A container shipping line announcement that it would blank four sailings in the Golden Week period has left shippers, still struggling to get cargo out of Asia, “staggered” at the move.

2M is the first alliance to announce blank sailings over China’s October holiday period and has left some shippers in limbo, with booked cargo on the cancelled sailings and still struggling to find capacity on brim-full export ships from Asia.

Maersk and MSC, the 2M partners, have cancelled four scheduled Asia-North Europe loops in weeks 39 and 40, thereby removing some 70,000 TEU of capacity from the route.

The reason, said MSC, was “to enhance schedule reliability.”

September 13: Port Operations in Shanghai and Ningbo Halted by Typhoon Chanthu – Lloyd’s Loading List

Ports in Shanghai and Ningbo, the world’s largest and third-largest container hubs, have closed for the second time due to the impact of a typhoon this summer.

China’s National Meteorological Centre issued an orange alert, the second-most serious level, for the Typhoon Chanthu, which was expected to make landfall in the Zhoushan Archipelago, Zhejiang province on Monday with strong gales and heavy rainfall.

Terminal operators at the nearby Yangshan Deepwater Port, which accounts for about 45% of Shanghai’s throughput, suspended all box pickup and delivery operations from September 13.

The two main port areas, Waigaoqiao and Wusong, halted the entry and exit of containers at the same time.

September 13: Exporters Ratchet Pressure on Biden to Take on Shipping Challenges – American Shipper

A historic peak shipping season with significant container ship backlogs is being used by a coalition of U.S. agricultural exporters to promote regulatory changes attempting to rein in alleged abuses by container carriers.

In a letter sent to the White House, 76 groups representing various agricultural export commodities warned that steps taken so far by the Biden administration to address the problem are not enough. They claim that operational tactics that carriers continue to employ are burdening exporters with unreasonable costs and robbing them of foreign-market opportunities.

September 16: Record Shattered: 61 Container Ships Stuck Waiting Off California – American Shipper

The number of container ships at anchor or drifting in San Pedro Bay off the ports of Los Angeles and Long Beach has now blown through all previous records and is rising by the day.

There were an all-time-high 61 container ships in the queue in San Pedro Bay on September 15, according to the Marine Exchange of Southern California. Of those, a record 21 were forced to drift because anchorages were full.

Theoretically, the numbers – already surreally high – could go a lot higher than this. While designated anchorages are limited, the space for ships to safely drift offshore is not.

September 17: Little Relief in Sight for Container Equipment Shortages – Lloyd’s Loading List

The shortage of containers that is plaguing shippers is not due to any underinvestment in the equipment fleet, but due to the extended time they are spending in transit, according to container shipping specialist Drewry.

“Not only have we got rising cargo demand, but there is the continuing disruption across the container supply chain, which means it is taking much longer for containers to complete their voyages,” Drewry head of research Martin Dixon said, explaining that it is these delays that are leading to inefficiencies in the container fleet.

September 17: ‘Scandalous’ New Surcharge Wipes Out Effect of Carrier Rate Hike Moratorium – The Loadstar

The huge earnings of ocean carriers in the first half of the year will gather pace in Q3 and Q4, as old contracts expire to be replaced by new but much higher short- and long-term deals.

Maersk was obliged last week to again upgrade its full-year EBIT guidance by a further $4 billion to $4.5 billion, after it reported Q3 trading was “significantly ahead of our previous expectations,” assessed during its outlook update in August.

September 20: Crew Change Crisis Getting Worse – Seatrade Maritime News

A year ago, the crew change crisis was attracting mainstream media attention, but it now seems to have dropped from view, a victim perhaps of the dreaded “new normal,” while ship managers and owners continue to struggle with lengthy quarantines, travel restrictions and regulations that simply prohibit crew change.

Anglo-Eastern Univan CEO Bjorn Hojgaard took to LinkedIn to vent his frustrations that the crew change crisis is “getting worse, not better” and stating that ports and nations were to blame.

“The way we treat seafarers in 2021 is absolutely shameful. Since the pandemic started, crewing departments the world over have scrambled to facilitate crew change against increasingly difficult odds,” Hojgaard wrote.

Hojgaard is by no means alone in his frustrations over the lack of action over the crew change crisis.

September 24: Container Ships Now Piling Up at Anchorages off China’s Ports – American Shipper

There are over 60 container ships full of import cargo stuck offshore of Los Angeles and Long Beach, but there are more than double that – 154 as of September24 – waiting to load export cargo off Shanghai and Ningbo in China, according to eeSea, a company that analyzes carrier schedules.

The number of container ships anchored off Shanghai and Ningbo has surged over recent weeks. There are now 242 container ships waiting for berths countrywide.

Whether it’s due to heavy export volumes, Typhoon Chanthu or COVID, rising congestion in China is yet another wild card for the trans-Pacific trade.

September 26: Nationwide Australian Port Strikes Threaten Christmas – The West Australian

Strikes planned at ports across Australia threaten to cripple imports ahead of Christmas.

The Maritime Union of Australia has launched industrial action at Patrick Terminals sites in Brisbane, Fremantle, Melbourne and Sydney, in what the shipping container terminal operator has described as “bewildering.”

Patrick Terminals CEO Michael Jovic says the company has been negotiating with the union since February 2020 and has held nearly 70 meetings to finalize a new enterprise agreement.

September 27: Northern European Ocean Terminal and Inland Congestion Forces River Barges to Store Boxes – The Loadstar

Barges are being turned into floating storage platforms to alleviate pressures on Northern Europe’s ocean terminals, as inland waterway operators report surging congestion.

Wait times at Rotterdam have sky-rocketed over the past week to almost seven days.

A source told The Loadstar: “The cause is two-fold – obviously, ocean-side congestion is having a knock-on impact, with yards and terminals well over capacity, in terms of storage, and now refusing to accept new boxes without evacuation of the backlog.

“Barge owners are now being called in to fill their vessels with some 400 TEU of empties and find a way of connecting these to ocean carriers for evacuation.”

However, with near week-long delays for handling at the Dutch terminal, barge owners were forced to consider alternatives, with some simply offering their vessels as storage sites until the backlogs begin to clear.

 

 

Air

September 14: Air Brokers Struggle to Find Peak Lift as Shippers Bid to Avoid Port Congestion – The Loadstar

Port congestion is providing unprecedented opportunities for air charter brokers – but an absence of passengers is creating challenges in capacity as shippers gear up for peak season.

The head of cargo charters at Hunt & Palmer, Jamie Peters, said: “When it comes to moving cargo, forwarders and shippers are facing continuous issues.

“Everything is geared towards Q4, with expectations of a substantial peak period, but it is becoming impossible to locate any large aircraft capacity with less than one or even two weeks’ advance notice; there are extremely limited openings.

“Any that do exist come at a very high premium that most customers are turning down… for now, at least.”

September 16: Air Freight Rates Surge Ex-Asia – Lloyd’s Loading List

The latest figures this week from the Baltic Air Freight Index see average spot rates on Shanghai (PVG) to North America reaching almost US$11 per kilo at $10.98, while HKG to North America prices are also edging towards the $10 mark, at $9.70 per kilo this week, as strong peak season demand collides with highly constrained capacity heightened by the recent further constraints to capacity at PVG due to COVID-related shutdowns.

September 23: Air Cargo Handlers Face Staff Shortages on Both Sides of the Atlantic – The Loadstar

Fluctuating volumes, pandemic-induced government support schemes and staff shortage woes have left ground handlers facing “very different labour dynamics” across networks.

COO of Menzies Aviation Mervyn Walker said the ongoing impact of COVID-19 differs country to country and is forcing the company to make “tailored” approaches to tackling recruitment challenges, which some claim are worsening.

September 23: TIACA Warns Air Industry Not Ready for Q4 – Inside Logistics

The International Air Cargo Association (TIACA) warns that the industry is facing unprecedented challenges to deal with expected fourth-quarter demand for air cargo services.

“Air cargo has played a vital role these past 18 months and is facing a potentially record fourth quarter, but planning must start now,” said Steven Polmans, TIACA. “Resourcing and capacity will be issues, handling and facility space will be an issue, delivery and drivers will be an issue. We should be proud of the innovative, agile and flexible approaches adopted by the industry these past 18 months and now we must equally rise proactively to these new challenges as the weight of customer expectations mount.”

 

 

Rail

September 1: KCS Shareholders in Hot Seat as CP Sets Deadline on Merger Offer – FreightWaves.

It’s up to Kansas City Southern’s shareholders now to determine whether the railway will continue its plan to merge with CN or revert to Canadian Pacific.

CP President and CEO Keith Creel is standing firm on a September 12 deadline for KCS shareholders to respond on whether to accept CP’s $31 billion “superior offer” to acquire the company.

Rivals CN and CP have both been seeking to acquire KCS. CP and KCS announced in March their plans to merge, but then CN put forth a competing, $33.6 billion bid and KCS opted in May to go with CN.

But on August 31, the Surface Transportation Board rejected CN’s proposed voting trust, which would be used as part of the process to acquire KCS. The board said the trust “is not consistent with the public interest standard under the Board’s merger regulations.”

September 3: KCS Punts Merger Vote until Late September – FreightWaves

Kansas City Southern shareholders are holding off on voting or moving on merger proposals from CN and, apparently, Canadian Pacific until late September. The announcement of the postponement referenced votes “on the previously announced definitive merger agreement with CN … and other proposals … .”

Shareholders held a meeting on September 3 and decided to hold another meeting September 24. In the meantime, KCS will “evaluate its options and the KCS Board of Directors will continue to make decisions based on the best interests of the Company and its stockholders,” KCS said.

September 15: CN Rail Walks Away from Kansas City Southern, Ending Takeover War – Transport Topics

Canadian National Railway Co. declined to increase its offer for Kansas City Southern after a months-long takeover battle, ceding to Canadian Pacific Railway Ltd. a prize that would create the first railroad spanning the U.S., Canada and Mexico.

Kansas City Southern terminated its $30 billion agreement with Canadian National and agreed to Canadian Pacific’s $27 billion merger proposal, according to a statement Sept. 15. The merger will need approval from shareholders, Mexican regulators and the U.S. Surface Transportation Board.

 

 

Trucking

September 22: Freight Markets Remain Strong, but First Signs of Clouds on the Horizon – Today’s Trucking

ACT Research reports that the freight market is likely to remain hot, but “there might be a cloud or two on the horizon.”

Industry analyst Jim Meil said there are some concerns about COVID, inflation, rising oil prices, supply chain disruptions and labour availability. Microprocessors, which are in short supply, are also going up in price due to demand, he noted. The cost has increased 4% this year, which contributes to inflation.

But analyst Tim Denoyer said the freight market remains strong, and repeated his projection for a peak season that will be “stronger for longer” than norms. With record numbers of container ships anchored or adrift off the U.S. West Coast, he said the industry is experiencing the longest freight backlog ever.

The railroads are also backed up, and there’s a chassis shortage that is keeping a lid on service levels.

“Truckload volumes will stay strong through the holidays,” Denoyer said.

Next year some of the tailwinds driving freight volumes and rates this year will disappear, but anticipated infrastructure spending will give freight another boost. Industrial demand is also expected to improve next year – another boon for freight.

September 23: ATA: U.S. Mandatory Vaccinations Would Trigger Truck Driver ‘Exodus’ – Ontario Trucking Association

American Trucking Associations President and CEO Chris Spear issued a statement in response to the Biden Administration’s proposed vaccine mandate on employers with more than 100 employees:

“The first rule of any public health policy should be ‘do no harm.’ Unfortunately, these latest mandates and the unintended consequences they’ll create fall short of that standard.

“These proposed requirements – however well-intentioned – threaten to cause further disruptions throughout the supply chain, impeding our nation’s COVID response efforts and putting the brakes on any economic revival.”

September 26: Average Annual U.S. Driver Salaries Have Cracked $70K – Truckload Indexes

For the first time since Todd Amen’s ATBS firm has been tracking fleet and average independent owner operator salaries, pay levels have cracked an annual rate of more than $70,000.

That was the bottom-line number that came out of ATBS’ semi-annual webinar in which Amen reviews data on how drivers are doing. The numbers he draws from are from a huge base of financial information compiled through his company’s activities offering tax and other financial services to owner operators and fleets.

“We’re in the best trucking environment I have ever seen in my history of trucking in 30-plus years,” said Amen, the company’s president and CEO.

Maritime

August 3: Container Lines Fighting Losing Battle on Capacity – Lloyd’s Loading List

Container lines are fighting a losing battle to inject sufficient capacity into the market as schedule delays absorb the huge amount of additional tonnage that has already been deployed on key trade lanes.

“Despite data from CTS showing a very modest global demand growth … most freight rates continue to set records and shippers find themselves in a situation of fighting over available capacity,” said Sea-Intelligence chief executive Alan Murphy. “The current predicament is driven in the main by lack of capacity and not by a demand boom.”

In practical terms, a carrier offering a weekly service using 10,000-TEU vessels on the transpacific would need six ships for the six-week round trip. But if a ship were delayed by a week due to port congestion at either end of the voyage, an additional vessel would be required to maintain the same capacity. “This means the carrier de facto needs to increase nominal capacity by 16.7%, simply to maintain the same weekly capacity,” said Murphy.

“The effect of this is exactly the same as if the market demand had increased 16.7%, as that would have required the same injection of net capacity in the market.”

 

August 3: Shipping Braces as China Goes into Lockdown Mode – Splash

Shipping will need to start to make contingency plans if cases of COVID-19 continue to escalate in China.

The Delta variant has broken through the country’s virus defences, which are some of the strictest in the world, and reached nearly half of China’s 32 provinces in just two weeks. While the overall number of infections – more than 360 so far – is still lower than COVID resurgences elsewhere, the wide spread indicates that the variant is moving quickly, with many millions of Chinese now in lockdown.

“For freight markets, the implications include delays at ports as authorities screen crews of incoming vessels and a hit to China’s oil demand if widespread lockdowns are imposed,” said a report from Braemar ACM.

“As long as lockdowns remain confined to China, the impact on freight markets is likely to be muted, especially in the case of wet and dry freight. The container market seems most vulnerable if we see more severe disruptions to manufactured-products supply chains,” commented Plamen Natzkoff, senior trade expert at VesselsValue.

 

August 4: China Typhoons Create Latest Supply Chain Threat as Ports Shut – American Journal of Transportation

Extreme weather in China is becoming the latest challenge to global supply chains, as a heavy typhoon season threatens to further delay goods stuck at some of the world’s busiest container ports.

Yantian port in southern China’s export and industrial hub of Shenzhen stopped drop-off services of containers on August 3 due to a typhoon alert, the port said on its official social media account. Just two weeks earlier, Shanghai’s Yangshan mega-terminal facility and nearby ports evacuated ships as Typhoon In-Fa slammed into the coast, bringing widespread flooding and toppling containers stowed in the hold of a bulk carrier traveling to the U.S.

There may be worse to come, as officials predict more typhoons will hit China this month.

 

August 5: Ocean Contract Rates Surge Almost 30% in a Month – Lloyd’s Loading List

July saw the container shipping industry “enter uncharted water,” as long-term contracted rates surged by their largest-ever monthly increase – “climbing by close to one third,” analysis by ocean freight rates specialist Xeneta indicates.

According to the latest Long-Term XSI Public Indices from Xeneta – which crowdsources real-time rates data from leading shippers – the global index recorded a “staggering” month-on-month jump of 28.1% compared with June, “blowing the previous record (a 11.3% rise in May 2019) out of the water.”

The benchmark now stands 78.2% higher than in July 2020, and up 76.4% in 2021 alone.

 

August 9: Ningbo and Shanghai, the World’s Two Largest Ports, Experience Unprecedented Congestion – Splash

The world’s two largest ports are experiencing unprecedented volumes of tankers, bulk carriers and containerships backing up into the East China Sea as a combination of renewed COVID cases, fierce weather and strong U.S. demand creates further supply chain havoc.

The two ports were hit hard by a typhoon late last month and have seen productivity slow as new anti-COVID measures are being carried out at most Chinese quaysides in the wake of the sudden spread of the Delta variant of COVID-19 over the past three weeks.

Sea-Intelligence has carried out a data-led inspection of container port congestion at 22 ports around the world. The results show Shanghai and Ningbo recently coming under huge pressure from growing congestion.

Among the 22 ports surveyed, only Los Angeles, Long Beach, Oakland, Rotterdam, Antwerp and Vietnam had more-severe congestion than China’s big two ports.

 

August 10: Reefer Cargo the New Battleground, with Rates Rising and Equipment Scarce – The Loadstar

Container shipping bottlenecks are creating winners and losers in reefer cargo, with consumers footing the bill for the increased logistics costs.

According to Drewry, average reefer freight rates jumped 32% in Q2, and are on track for a 50% increase by the end of Q3.

Increases on the major east-west tradelanes were particularly strong, Drewry noted, where available capacity has seen record demand in recent months, and reefer shippers have to compete with dry freight BCOs for slots.

 

August 11: The World’s Largest Port, Ningbo, Starts to Turn Ships Away as a Worker Tests Positive for COVID-19 – Splash

Operations at a terminal of the world’s largest port were suspended on August 10 following a case of COVID-19 being detected in a worker.

Ningbo-Zhoushan port started to turn ships away on the morning of August 10 in the wake of the positive test. Initially, the ports authority claimed that its operating system was down early this morning before the Ningbo Municipal Health Commission came clean with the news. The infected worker was part of the workforce at Ningbo Meidong Container Terminal.

Splash had already reported on August 9 about the unprecedented volumes of tankers, bulk carriers and containerships backing up outside Ningbo-Zhoushan port.

 

August 23: Ningbo’s Meishan Terminal Partially Reopens – Lloyd’s Loading List

The blocked Meishan terminal at the Chinese container port of Ningbo appears to have partly been reinstated, with new arrivals of three containerships last weekend – and after Meishan started to handle vessels at berth in the middle of last week.

The three vessels that entered the terminal had been waiting in the anchorage for up to nine days.

This development came after two large boxships left Meishan over the weekend after being at berth for more than 10 days due to the coronavirus-led closure of the facility.

No official announcement has yet been made as to when the terminal will reopen, although talks have been circulated in the market that local authorities plan to fully restore its operations on September 1.

 

August 25: Ningbo Disruption Adds to Equipment Shortage – Lloyd’s Loading List

Recent disruptions in Ningbo and Vietnam as a result of the pandemic are set to worsen an already tight equipment supply situation in China, driving up shipping costs again.

Data from equipment platform Container xChange indicates that early disruptions at Yantian and nearby terminals in May and June are still causing “disruptive ripples” in the supply chain.

“We saw a real and measurable spike in container prices and a major drop in container availability when terminals at Yantian saw operations disrupted through most of June,” said Container xChange co-founder Christian Roeloffs. “Early indicators suggest we are likely to see the same impact in Vietnam and at Ningbo.”

 

August 26: More than Half of HMM Seafarers Quit as Pay Dispute Heats Up – But Talks Go On – The Loadstar

More than half of HMM’s 600-strong seafarer workforce have quit following management refusal to meet pay demands.

Some 453 staff voted in the seafarers’ union strike ballot last weekend, more than 90% backing action in protest at a reluctance to give generous salary increases after a pay freeze between 2011 and 2019, due to the company’s poor performance in those years.

Meanwhile, the union said on August 25 it would extend negotiations by a week, to September 1.

 

August 27: Container Shipping Reliability Drops Further – Lloyd’s Loading List

Container shipping vessel schedule reliability dropped further in July as global port and congestion disruption continued, and the average delays for late vessel arrivals continued to deteriorate, according to new analysis by Sea-Intelligence.

The container shipping analyst’s latest Global Liner Performance (GLP) report indicates that vessel schedule reliability fell month-on-month by 3.8 percentage points in July to 35.6%, down “a massive 39.7 percentage points” from last year.

 

August 27: Big is Beautiful to Carriers in the New Shipping Contract ‘Beauty Contest’ – The Loadstar

Shippers and BCOs must be prepared to take part in “beauty contests” to determine their suitability for long-term contracts with their carriers.

But, given the extent to which the market has pivoted in favour of the shipping lines since the pandemic, one thing is certain: Contract shippers will be paying much more next year to move their cargo, and possibly for years to come.

According to freight rate benchmarking company Xeneta, carriers such as Maersk, on track to carry 60% of their business on contracts by the year end, will focus on locking-in more of their carryings supported by long-term agreements.

The advantages for carriers in nailing down long-term contracts with shippers during the current period of unprecedented freight rate inflation are obvious. Moreover, to facilitate forward planning for ship and equipment orders, the lines need to be less exposed to the volatility of the spot market.

 

Air

August 6: Uptick in Passenger Air Travel Hitting Cargo Capacity – Lloyd’s Loading List

The recent uptick in passenger air travel has seen a significant number of ‘preighters’ returning to passenger (pax) mode, raising fresh concerns that the air freight capacity squeeze is set to intensify as the peak season approaches, according to a leading freight forwarder.

 

August 13: Cargo Airlines Cancel Hundreds of China Flights amid COVID Outbreak – American Shipper

Chinese restrictions to control a spike in COVID infections have severely curtailed cargo operations at several airports and reduced crew availability, forcing airlines to cancel hundreds of flights as the peak shipping season kicks into high gear in a sector already struggling to keep up with high demand.

Logistics professionals say the growing scarcity of long-haul aircraft could push freight rates near $20 per kilogram on certain trade lanes within a few weeks, making air transport five or six times more expensive than normal for the fall rush. The only time shipping costs have been that high was during the early days of the pandemic when the mass grounding of passenger flights took away a vast amount of cargo space.

 

August 16: Pandemic Rules Bring China Air Cargo Chaos as Ground Staff Quit and Rates Soar – The Loadstar

Ground handling staff in China are quitting in droves over new COVID rules, triggering the cancellation of hundreds of flights and the prospect of freight rates reaching “extraordinary” levels.

According to one Chinese forwarder, long handling times at Shanghai Pudong (PVG) saw some cargo flights taking off empty over the weekend. “Export cargo handling times are six to 10 hours, two-to-three times longer than normal,” he said.

“PVG is the most affected and, over the weekend, many flights could only load a small part of their outbound cargo, while others just flew back without any cargo, creating a huge backlog for upcoming flights.”

 

August 19: Air Cargo Charter Market Set for ‘Extremely Challenging’ Peak Season – Lloyd’s Loading List

Constrained capacity and elevated prices continue to be the dominant features of the air cargo charter market with leading brokers predicting an extremely challenging peak season as strong demand rises even further to a backdrop of ocean freight chaos and buoyant cross-border e-commerce volumes.

Capacity remains very tight for full freighters while the space offered by passenger aircraft operating in all-cargo mode is also in high demand, said Chapman Freeborn’s head of cargo, Pierre Van der Stichele.

“Between spring and summer, we did see a slight easing for a short period but the capacity crunch is back on. Due to recent events taking place in the world, such as the recent earthquake in Haiti, we are already seeing further demand, with relief agencies needing capacity for humanitarian flights.”

He said it was “practically impossible” to obtain wide-bodied freighter capacity at short notice unless there was a last-minute cancellation of a flight, which sometimes occurs due to a delay with cargo.”

 

August 20: Cargo Logjam Building after COVID Disrupts Handling at Shanghai Pudong Airport – The Loadstar

COVID testing disrupted cargo operations at Shanghai Pudong Airport (PVG) on August 20, with widespread delays and flight cancellations expected over the weekend.

Ramp handler Shanghai International Airport Services suspended activities after a positive case was detected, and all staff were sent for testing or quarantine, according to forwarders.

One said: “But PVG is not closed – none of the terminals are closed, that is just a rumour – the problem is with the ramp handler only.”

Nevertheless, the impact is likely to be substantial. The forwarder said there were serious delays for flights on August 20 and over the weekend, with many more cancellation notices expected from airlines in the week of August 23.

 

August 25: Air Freight Rates Soar due to Shanghai Challenges – Lloyd’s Loading List

Fresh outbreaks of COVID-19 among air cargo handlers in Shanghai and other Chinese airports that are causing cancellations and a lot of uncertainty for ex-China air cargo are also pushing up air cargo rates, with spot prices ex-Shanghai rising 15% to 25% to U.S. destinations this week and 12% to15% to airports in Europe, new data from digital rates specialist Freightos reveals.

These prices “are double their level a year ago and are at their highest point since May 2020 when the industry was under extreme pressure due to the rush on PPE,” highlighted Judah Levine, head of research at Freightos.

 

August 26: Air Cargo Carriers Shift Operations as Shanghai Disruption Drags On – Supply Chain Dive

Air carriers are adjusting their operations and diverting shipments in the face of freighter suspensions at Shanghai Pudong International Airport due to the closure of a terminal, PACTL, that began Aug. 20 after COVID-19 cases were reported among cargo workers.

Lufthansa Cargo is not accepting any additional freight for transport to Shanghai through August 27, and Qatar Airways, Air Bridge Cargo and Polar Air Cargo have diverted future shipments to other airports in China.

The exact duration of the suspensions remains unclear. However long the freighter suspensions last, “the impact will be significant,” said C.H. Robinson.

 

August 26: Air Freight Peak Season Has Arrived a Month Early – Lloyd’s Loading List

Air freight’s annual autumn and winter peak season has arrived a month early, air freight forwarders and sources are reporting, due to a combination of factors including manufacturing production delays, ocean freight turmoil, and COVID-related air-capacity reductions and regional lockdowns.

 

Rail

August 10: CP Boosts Bid for Kansas City Southern – Inside Logistics

Canadian Pacific Railway has submitted a new proposal to Kansas City Southern (KCS) rail shareholders, upping its previous US$25 billion bid to $31 billion.

The new bid still falls short of Canadian National’s offer of $33.6 billion, which KCS has conditionally accepted.

CP claims its new proposal “represents improved terms” to those agreed to in the CP-KCS merger agreement entered into on March 21, 2021, and says they are “substantially similar” to those in the CN merger agreement.

However, CP says its bid “offers significantly higher regulatory certainty” than the proposed CN merger.

 

August 12: Kansas City Southern Rejects New Takeover Bid from Canadian Pacific – MarketWatch

Kansas City Southern railroad is trying to keep its $33.6 billion merger with Canadian National on track by rejecting a competing $31 billion bid from rival Canadian Pacific earlier this week.

Kansas City Southern said on August 12 that its board unanimously decided to continue backing Canadian National’s higher offer. KCS shareholders are scheduled to vote whether to accept CN’s offer on August 19, but the U.S. railroad said it may now delay that vote if the U.S. Surface Transportation Board doesn’t issue its decision on a key part of Canadian National’s acquisition plan before August 17.

 

Trucking

August 9: Driver Pay Hikes Not Letting Up – FreightWaves

Demand for truck capacity remains high, but the lack of qualified drivers to meet the need is even greater. Elevated consumer spending has resulted in a peak-like freight market for more than a year now, and the reasons why driver employment has been lagging are well known.

Many of the drivers who left the industry at the pandemic’s onset over fears of contracting the virus have yet to return. Low driver school enrollments due to COVID protocols and some 85,000 operators with failed drug tests (according to Drug & Alcohol Clearinghouse data) are just some of the obstacles the fleets face.

The result has been a race to raise pay in efforts to recruit and retain drivers even as the driver market may be loosening somewhat.

 

August 16: Federally Regulated Trucking Companies Not Required to Mandate Vaccinations – Today’s Trucking

The federal government’s announcement requiring mandatory COVID-19 vaccinations for federal workers will not apply to federally regulated trucking companies, the Canadian Trucking Alliance (CTA) confirmed.

Transport Minister Omar Alghabra made the announcement on August 13, saying federal public service employees will need to be vaccinated as early as the end of September.

Vaccinations will also be required for those working in the federally regulated transportation sectors of air, rail and marine, as well as all commercial air passengers.

But federally regulated trucking companies will not be required to mandate vaccinations, though the government is “strongly encouraging” employers to continuously urge vaccination within their workforces, the CTA says.

 

August 20: Canada’s Spot Market Cools in July – Today’s Trucking

Canadian spot market load volumes fell 11% in July, reflecting Canadian and U.S. holidays. Daily postings were down an average of 6% per day.

However, Quebec bucked the trend with strong outbound volumes both domestically and cross-border. Load volumes were up 31% compared to July 2020, according to the latest data from Loadlink Technologies.

Outbound cross-border loads were up 24% from June, and 49% year-over-year, Loadlink reported. Quebec led the way with a 66% increase in outbound cross-border loads.

However, inbound cross-border loads were down 29% from June. All regions in Canada saw decline sin inbound cross-border loads, with Western Canada the least affected with a 15% drop.

 

CIFFA Advocacy, Communications, Activities

August 20: CIFFA Submits Position Paper to All Political Parties Ahead of Federal Election

Critical Issues in Transportation Affecting Canada’s Recovery, a paper outlining CIFFA’s position on issues important to maintaining and developing a strong transportation and supply chain sector in the country, was recently sent to all political parties in advance of the federal election announcement.

Thank you to the members who contributed through their participation in CIFFA’s committees. Their input shaped the document, with perspectives on customs services and border modernization, trade gateways, and key issues in the marine and aviation sectors.

The report is available in English and French.

 

August 26: CIFFA Posts New Air Cargo Screening Resource

A list of ground handlers has been compiled for CIFFA membership, showing their capabilities and services available for screening 100% of international air cargo transported on commercial aircraft, as per the ICAO (International Civil Aviation Organization) requirement.

Find the spreadsheet on the Resources webpage.

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