Ocean Rates and Trends for US Market | June 21, 2023

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Key takeaways for the US

• Vancouver port workers have gone on strike, causing disruptions in operations.
• There is a possibility of a strike occurring in other ports across Canada.
• Historically low water levels caused draft restrictions on vessels crossing from Asia to the USA East and Gulf Coasts.
• The contract negotiations between the ILWU and PMA, which have lasted for 13 months, are possibly coming to an end.
• Additionally, a one-time lump sum payment of around $3500 has been included in the agreement.
• Ningbo, Shanghai, and Qingdao terminals are facing delays of up to 2.5 days due to vessel bunching and bad weather conditions.

Read on for more in-depth updates.

Ocean Freight Market Updates 

Asia → North America

US/CA

Transpacific Trends and Market Updates

• Vancouver port workers have gone on strike, causing disruptions in operations.
• There is a possibility of a strike occurring in other ports across Canada.
• Historically low water levels caused draft restrictions on vessels crossing from Asia to the USA East and Gulf Coasts.
• CMA CGM will adjust the PANAMA CANAL ADJUSTMENT FACTOR to comply with the authorized draft and maintain service reliability.
• The adjustment will take effect on August 1, 2023.
• The revised factor applies to cargo being shipped from Asia (including China, Hong Kong, Taiwan, South Korea, and Japan) Ports of Load to all U.S. East Coast and U.S. Gulf Coast Ports of Discharge.
• Previous concerns about potential disruptions due to the labor dispute have led to the redirection of container volumes to the eastern United States.
• Ningbo, Shanghai, and Qingdao terminals are facing delays of up to 2.5 days due to vessel bunching and bad weather conditions.
• Rates from the Far East to Europe and the US continue to decline.
• According to Drewry, average spot rates from Asia to North Europe are more than 80% lower compared to a year ago.
• Rates from Asia to the US West and East coasts are also declining, according to Xeneta.
• From Shanghai (SHA) to Europe, rates and US rates have increased. Flights to AMS have been canceled due to aircraft compliance checks, contributing to rate increases. The volume of E-commerce products has also played a role.

Conclusions

Rates - The rates will remain soft on most origin-destination combinations.

Space - Space open, no issues with equipment. 

Recommendations - We recommend blank sailings to continue. Book at least two weeks before the date your vessel gets ready to depart.

Turkey → North America

• Despite 9 consecutive months of year-on-year decreases in containerized imports, US inventory levels remain high.
• Global container demand experienced a decline of -12% between September 2022 and February 2023.
• Sales data continues to decline, and the extent of high inventories varies across different sectors.

Conclusions

Rates - The rates will remain soft on most origin-destination combinations.

Space for capacity - No capacity issues or issues with space.

Space for equipment - No issues with equipment.

North America → Turkey

• The contract negotiations between the ILWU and PMA, which have lasted for 13 months, are possibly coming to an end.
• A tentative agreement has been reached between the two parties.
• The PMA has agreed to a 32% salary increase over 6 years.
• Additionally, a one-time lump sum payment of around $3500 has been included in the agreement.
• Analysts are optimistic that this agreement will bring an end to a turbulent 12 months for west coast ports.
• These ports have been plagued by disruptions caused by industrial action.

Conclusions

Rates - Stable rates over the last week.

Space for capacity - No major capacity or space issue.

Space for equipment - Equipment issues have started owing to low levels of import.

Terminal Updates

• Vessels heading to North America via the North Atlantic Sea are expected to have a change in schedule due to severe weather conditions.

New York:

• No waiting time is expected for a berth at Global Container Terminals Bayonne and APM Terminals.
• No more waiting time at Maher Terminals LLC.
• No empty shut-out situations at any of the terminals this week.
• Average gate turn times: 42 minutes for single transactions, and 76 minutes for double transactions.
• APM Terminals will not have a truck gate on Saturday, June 17, 2023.

Norfolk:

• Most vessels are expected to berth on arrival or within half a day, occasionally experiencing 1.5 day delays for berthing.
• Average gate turn times: 26 minutes for single transactions, and 40 minutes for double transactions.
• One crane down at Norfolk Int'l Terminal, no negative impact is expected this week.

Charleston Terminal:

• 1 day waiting time for vessel berthing at Wando Welch Terminal.
• No waiting time expected at North Charleston Terminal.
• Average truck turn times: 18 minutes at Wando Welch Terminal, and 20 minutes at North Charleston Terminal.
• Chassis pools are available at all SCPA locations.
• Sunday gates by appointment only.

Savannah:

• Waiting time for vessel berth at the terminal is up to 3 days, depending on the size of the vessel.
• Average gate turn times are 32 / 53 minutes for single and double transactions respectively.

Houston:

• Barbours Cut Terminal’s waiting time for vessel berthing is up to 1 day.
• The average gate turn time is 37 minutes.

Oakland:

• Average wait time of up to 10 days at Oakland Int’l Container Terminal (OICT) and up to 2 days at TraPac.
• Average import deliveries can take up to 5.6 / 4 days at TraPac and OICT respectively.
• As yard space becomes available, boxes from TraPac will move to accessible areas for delivering.
• Average gate turn times are 56 / 55 minutes for OICT and TraPac respectively.

Seattle-Tacoma:

• There are no vessel berthing delays in Tacoma.
• However, in case of delays at departure ports overseas, delays of up to 8 days are expected.
• Import deliveries are 2 days at HUSKY – due to EB/WB railcar imbalance, 0-3 days at Washington United Terminal, and 0-3 days at T18.
• Availability of rail cars in Union Pacific Rail and BNSF Rail continues to fluctuate weekly.
• Average gate turn times are 37 / 31 / 49 minutes for T18, Washington United Terminal, and HUSKY respectively.
• T18 Terminal will be closed on June 9, 16, and 19, 2023.
• Washington United Terminal will be closed on June 19, 2023.
• Husky will be offering a limited gate on June 14, 2023 for exports and empty receiving.
• Starting June, SSA Terminals T18 (Seattle), will offer a fee-based weekend gate.

Los Angeles/Long Beach:

• All terminal gates are running as published and in line with the Pier Pass program.
• Port of Los Angeles dwell times for local import cargo is 3.3 days, on-dock rail dwell is 3.8 days, and import units on the street are averaging at 5.6 / 7 days for 20 ft and 40+ ft containers respectively.
• Port of Long Beach dwell times for local imports are stable, and the average terminal gate turn time is between 24-98 minutes, depending on the terminal.

• Chassis Pools: All pools are operating as normal except:

1. St. Louis - Constrained on 40’ chassis.

• Intermodal Operations: Truck power can be secured within 1-3 days for the majority of locations, including marine terminals, rail ramps, and depots.

Port Status

Final Thoughts

In light of the latest updates and trends, it is evident that the market is currently in the course of demonstrating robust performance and is equipped with ample capacity and resources.

Individuals and businesses involved in import/export activities must stay well-informed about market dynamics and strategies to make informed decisions. To ensure a smooth and hassle-free experience with your import/export operations, it is recommended to seek guidance from industry experts.

Conduct thorough research on ports that offer available space and suitable equipment despite the ongoing conditions. By doing so, you can minimize complications, facilitate shipments, and maximize efficiency.

Taking proactive measures and staying proactive in your approach will help you navigate the market effectively. We greatly appreciate your continued readership and encourage you to subscribe to our weekly market updates to stay abreast of the latest developments and insights.