Tag Archives: International Shipping

ByJaguar Freight

It’s Time for EIS Hikes and U.S. Import Spikes

The impact of tough market conditions is continuing. From increasing Equipment Imbalance Surcharges, to warnings of import spikes across the U.S., to warehouses that are too full, to post-Brexit container logjams, to modal shifts, we’re here to deliver this week’s most pressing news in international shipping. At the top of the list is approaching carrier Equipment Imbalance Surcharges (EIS) and General Rate Increases (GRI) scheduled to hit approximately a month from now.

According to AJOT, for example, MSC announced that “effective April 12th, 2021 an EIS will be applicable for all REEFER cargo ex. AUSTRALIA and NEW ZEALAND to USA & CANADA: USD 200 per 20’ Reefer and USD 400 per 40’ Reefer.” And for those hoping to see port congestion ease throughout the ports of Los Angeles and Long Beach, “anticipating record sales in 2021, retailers expect U.S. containerized exports will increase 20 percent or more each month through June,” based on JOC.com’s data.

This means that while conditions aren’t expected to get worse, we definitely won’t see any real improvements until well after this summer given the sheer strength of sustained consumer demand. Supply Chain Dive released information supporting this expectation as well, citing the availability of vaccinations and the recent stimulus checks as two primary contributors.

The anticipated boost in consumer spending is also projected to impact other major ports across the country. According to figures from S&P Global Market Intelligence’s Panjiva, “overall U.S. seaborne imports in February were up more than 29% YoY and up 20% compared to the same month in 2019.”

Supply chain delays are forcing many retailers to rethink their inventory management strategy and the result is warehouse space is becoming very tight. A big reason why is that many companies are building inventory to help smooth the problems further upstream in their supply chains. And, the negative impact of port congestion is starting to show up on companies’ bottom lines.

Over in the UK, ports are facing similar container congestion and trade disruption as leading gateway terminals struggle to handle increased traffic resulting from major pileups of complex post-Brexit cross-Channel shipments. With these freight delays in ocean shipping and the insanely high freight rates in air, shippers and forwarders are having to get more creative in how they source and transport their goods in order to find a reasonable balance between price and transit time.

Whether that involves turning to multimodal consolidation routing solutions or sticking to local manufacturing options and skipping China altogether is ultimately up to what logistics professionals value within their own supply chain processes. To learn more about how these industry updates are potentially affecting your operations, check out the following links:

ByJaguar Freight

Where Do Global Supply Chains Go From Here?

From lingering supply chain woes, to the Port of LA’s new vaccination site, to price hikes in air cargo, to moving forward in transportation management, to the UK’s new freeports, there’s a lot to discuss for this week’s global freight update. So, let’s get started.

Unfortunately, solving the container crisis requires more than simply throwing more boxes into the equation, which is why the FMC is cracking down on marine terminal operators and ocean carriers as well as encouraging more collaboration within the industry. If we don’t start focusing on solutions now though, elevated shipping costs are only going to go up from here and possibly even last well into 2022.

In an attempt to boost labor and ease the intense port congestion in Southern California, the International Longshore and Warehouse Union has partnered with local employers to launch a new vaccination site at the Port of Los Angeles. According to Jim McKenna, president of the Pacific Maritime Association, port authorities were aiming to vaccinate 7,000 dockworkers by the end of last week.

As container volumes continue to flood crucial U.S. gateways, the toll COVID-19 is taking on skilled equipment operators is only further escalating the situation at hand. Many are struggling to get their orders in on time while also having to pay high premiums that are eating away at their already slim margins.

Meanwhile, the air freight marketplace is seeing rising fuel prices combined with increasing airline surcharges show how, regardless of the mode, shippers are doing a lot of the heavy lifting when it comes to footing the bill. With ocean shipping maxed out and other sectors not too far behind, it’s becoming more and more apparent how much room for improvement there really is in transportation management.

On a more positive note, UK Chancellor Rishi Sunak has recently revealed the locations of eight new freeports, or free trade zones. Local authorities hope these areas will help simplify the current shipping situation, lower customs costs, and ultimately stimulate the country’s post-Brexit economy.

To learn more about this week’s leading headlines, check out the following international shipping industry highlights: 

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