Newsletter – July 12, 2021

AIR FREIGHT UPDATES

Construction work at Dhaka Airport causing air cargo chaos as rates soar

theloadstar.com
Air freight shippers in “dysfunctional” Bangladesh are facing severe congestion and rate hikes. It follows a perfect storm of modal shift from sea freight, rising volumes and, construction work at Dhaka Airport. Read more here.

Lack Of Security Staff At Heathrow Prompts Travel Chaos

simpleflying.com
Passengers traveling through London’s Heathrow Airport were forced to wait up to five hours this morning after security staff failed to show up. Over 100 staff members have been told to isolate by the NHS app. According to online reports, queues at Terminal 5 mainly affected passengers flying with British Airways, American Airlines, Qatar Airways, and Iberia. Read more here.

US Carriers Are Back: How Many Flights Are They Operating?

simpleflying.com
US passenger numbers are coming back. Hovering at around 75-80% of 2019-levels per day, airlines are encouraged by their full flights and heavy demand for domestic travel.
Business travel has also started to come back. While most of that clientele are expected to come back in the fall, the return of these travelers means higher yields for carriers. Business travel has been heavily reduced through much of 2020 and early 2021. With vaccinations rolling out and companies recognizing the importance of face-to-face interactions, those passengers are gearing up to get back onboard. Read more here.

OCEAN FREIGHT UPDATES

Carriers play down Biden’s competition threat

splash247.com
Carriers have sought to play down US government fears on competition and erroneous charges.
President Joe Biden has issued an executive order demanding the Federal Maritime Commission (FMC) take all possible steps to protect American exporters from the high costs imposed by the ocean carriers and to crack down on unjust and unreasonable fees, including detention and demurrage charges.
The World Shipping Council, the Washington DC-based liner lobbying group, has argued that normalised demand, not regulation, will solve the supply chain woes that have bedevilled shippers all year. Read more here.

Disunified chassis leasing system exacerbates port congestion

freightwaves.com
The ongoing container shortage and port congestion is becoming old news. Freight income per TEU is higher than ever due to the COVID-spurred consumer demand for goods. The industry is seeing a large number of blank sailings, not for lack of cargo, but because the containers sit in waiting for so long, they lose their place in the rotation.
“If your product isn’t in the U.S. by the end of October, you’ve hurt your ability to maximize holiday sales,” FreightWaves Senior Retail Analyst Andrew Cox said.
The Port of Los Angeles tried to stick a Band-Aid on the problem with solutions like Return Signal ⁠— a visibility platform designed to help truckers know when and where to return empty containers, in hopes of increasing dual transactions. Read more here.

Ocean freight shippers urged to be ‘realistic’ on rates in unprecedented market

lloydsloadinglist.com
Shippers who are feeling pleased that they have negotiated excellent rates with ocean freight carriers should be wary in a market where carriers are increasingly prioritising high-paying cargo over contract rates with anyone other than their biggest customers, according to container shipping consultant Lars Jensen, CEO and founder of Vespucci Maritime. Read more here.

GROUND AND RAIL FREIGHT UPDATES

Fuel costs push rates higher faster in 2021

freightwaves.com
Truckload spot rates continue to trend higher in 2021, averaging $3.18/mile over the past two months compared to $2.96/mile (7.4%) from November to December of last year, according to Truckstop.com’s average top 100 lanes. What can get lost in the cost of transportation is the rising underlying costs such as maintenance, insurance and the most easily tracked — fuel.
Since Nov. 1, the average retail price of diesel fuel as reported by the DOE has risen nearly 40%, which has made the freight market appear to be tightening faster than it is. Read more here.

CN, CP must take new wildfire prevention measures

insidelogistics.ca
Federal Transport Minister Omar Alghabra ordered Canada’s two major railroad operators to step up their fire prevention efforts as of Sunday as wildfires continue to scorch British Columbia.
The Canadian National and Canadian Pacific railways must ensure a 60-minute response time to any fires detected along rail lines running through Lytton, B.C., with the goal of extinguishing or controlling the blaze and asking the local fire service for help if necessary, Alghabra said in a release. Read more here.

CANADA BUSINESS – GOVERNMENT UPDATES

An International Request for Proposals to Complete the Future Container Terminal

port-montreal.com
Montreal, July 9, 2021 — The Montreal Port Authority (MPA) is entering a new phase in achieving its Contrecoeur expansion as it prepares to launch a Design-Build-Finance-Operate-Maintain (DBFOM) procurement process that will be open to national and international industry players.
“Factoring in our timeline, we are proceeding with the development and implementation of the Contrecœur container terminal through this national and international procurement process, which will make it possible for us to identify which consortium offers the best terms and conditions, notably to operate our important project,” said Martin Imbleau, President and Chief Executive Officer of the MPA. Read more here.

INTERNATIONAL BUSINESS – GOVERNMENT UPDATES

Import containers to be fumigated as Australia enforces Khapra beetle rules

theloadstar.com
Regulations requiring import containers from 40 countries across Europe, Asia, the Middle East and Africa to be fumigated to prevent the migration of Khapra beetles into Australia will be enforced from today.
All containers from 40 designated countries, listed by Australia’s Department for Agriculture, Water and Environment (DAWE), will need to be treated either using methyl bromide, heat treatment or pesticides, and to be issued with a valid certificate before leaving the port of export, from 12 July. Read more here.

Lower inventories offset rising transport costs in 2020: report

supplychaindive.com
Dive Brief:
Total U.S. business logistics costs were $1.557 trillion in 2020, a 4% decrease from the previous year, according to an analysis from Kearney in the Council of Supply Chain Management Professionals’ Annual State of Logistics Report.
Transport costs rose slightly by 0.8% to $1.059 trillion when all modes were considered, but a 15% decrease in the cost of carrying inventory last year led to a drop in the total index. Read more here.