Ocean Rates and Trends for US Market | June 7, 2023

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Key takeaways for the US

• CMA CGM and APL are facing operational delays on the US West Coast.
• The delays are related to the ongoing ILWU/PMA contract negotiations.
• Mainland China is in the process of post-pandemic reopening, potentially till the end of the year.
• Labor disruptions have resurfaced at US West Coast ports.
• Dwell time for exports at Chinese ports has decreased by 62%.

Read on for more in-depth updates.

Ocean Freight Market Updates 

Asia → North America

US/CA

Transpacific Trends and Market Updates

• CMA CGM and APL are facing operational delays on the US West Coast.
• The delays are related to the ongoing ILWU/PMA contract negotiations.
• Mainland China is in the process of post-pandemic reopening.
• The reopening is expected to continue throughout the rest of the year.
• Air operations in Mainland China are running smoothly.
• Labor disruptions have resurfaced at US West Coast ports.
• The ILWU (International Longshore and Warehouse Union) has initiated industrial action, causing concerns.
• The Ports of LA and Long Beach were shut down, and Seattle, Tacoma, and Hueneme experienced severe disruptions.
• Normal operations are expected to resume, but some delays are anticipated, with a five-day wait for vessel berthing in Oakland.
• West Coast ports previously lost container volumes to East Coast ports due to fears of disruptions from prolonged labor negotiations.
• The Port of LA and the Port of Oakland had seen recent growth in box volumes, but the current uncertainty may impact their rebound.
• Dwell time for exports at Chinese ports has decreased by 62% compared to the previous year, now averaging less than 5 days, based on data from Fourkites.
• The transit time from China to the US has significantly reduced from 55 days to less than 36 days.
• Transit times could increase again as carriers implement slow steaming measures to manage capacity.

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 declining demand, warehousing costs in the US are continuing to rise.
• Prologis, a real estate investment trust, predicts a 10% increase in rents this year.
• However, this projected rent increase contradicts the national vacancy rate.
• This has risen by 0.5% to reach 3.5% in the last quarter, the highest level in 14 years.
• Average rent prices have already seen an 11% year-on-year increase in Q1.

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

• New data from the US commerce department indicates a rise in US consumer spending in April.
• Consumer spending witnessed a 0.8% increase in April, following a 0.1% gain in March.
• The surge in consumer spending was driven by higher purchases of various forms of pharmaceuticals and light trucks.
• Wage growth in March and April has contributed to this unexpectedly strong level of consumer spending.
• This has resulted in an increase in imported goods by 1.8% in April.

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: 46 minutes for single transactions, and 76 minutes for double transactions.
• APM Terminals will not have a truck gate on Saturday, June 03, 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: 29 minutes for single transactions, and 38 minutes for double transactions.
• Two cranes down at Norfolk Int'l Terminal, no negative impact is expected this week.

Charleston Terminal:

• 2 days waiting time for vessel berthing at Wando Welch Terminal.
• No waiting time expected at North Charleston Terminal.
• Average truck turn times: 21 minutes at Wando Welch Terminal, and 18 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 2-3 days, depending on the size of the vessel.
• Average gate turn times are 35 / 53 minutes for single and double transactions respectively.

Houston:

• Barbours Cut Terminal’s waiting time for vessel berthing is up to 1 day.
• Saturday gates at Bayport and Barbours Cut Container Terminals discontinued as of May 1, 2023.
• The average gate turn time is 38 minutes.

Oakland:

• A labor strike at West Coast ports resulted in a complete halt of operations from June 2 to June 4, 2023.
• Operations resumed on June 5, 2023, but heavy traffic was reported at the gate.
• Average wait time of up to 5 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 60 / 52 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 2 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 33 / 42 / 46 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 4, 2023.
• Husky will be closed on June 4, 2023.

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 4.9 days, and import units on the street are averaging at 4.2 / 6.2 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 29-71 minutes, depending on the terminal.

Chassis Pools:

• All pools are operating as normal except:

1. Minneapolis / St. Paul – Constrained on a 20' chassis
2. St. Louis - Deficit 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.