Maritime

April 3: Conciliation Officers Appointed to Further Talks Between BCMEA and ILWU – BCMEA website

After the ILWU filed a notice of dispute to Canada’s Minister of Labour, two conciliation officers from the Federal Mediation and Conciliation Service were appointed to this matter on March 29.

The conciliation officers have a 60-day mandate from the day of appointment. An extension beyond 60 days can be made by mutual consent of the parties. At the end of the conciliation period, a 21-day cooling-off period would begin, if required.

April 4: Sharp Increase in Containership Schedule Reliability – The Maritime Executive

Coming back from the depths of the shipping surge experienced in 2021 and early 2022, the container shipping industry is recovering its schedule reliability to levels last seen at the onset of the pandemic. New data from Sea Intelligence shows the highest level of schedule reliability in 30 months, reaching levels not seen since August 2020 and approaching pre-pandemic norms.

“Schedule reliability was a staggering 26 percentage points higher” year over year, highlights Alan Murphy, CEO of Sea-Intelligence. The analysis firm’s data shows that the industry bottomed out a year ago, falling to a level where only one in three ships was on schedule. February 2022 showed just 34.2 percent global schedule reliability, continuing a two-year trend that began in January 2021 when reliability fell for the first time into the 30 to 40 percent range.

“Global schedule reliability increased sharply by 7.7 percentage points month over month in February 2023, reaching 60.2 percent,” says Murphy. Levels had begun nearly consistent monthly increases in May 2022, but February was the first time the level reached 60 percent.

April 5: ‘Nervous’ Box Lines Back-Pedal on D&D Charges in U.S. as New Rules Loom – The Loadstar

While U.S. ports and container terminals still resist a regulatory drive to curtail detention and demurrage (D&D) charges, several shipping lines have stopped charging cargo owners and truckers on days when terminals are closed.

The U.S. Federal Maritime Commission (FMC) has been questioning container terminals and the 11 largest box lines serving the U.S. on their policy of charging D&D fees when their facilities are closed.

Over the past couple of years, shippers and truckers have protested furiously over being charged when they had been unable to get access to congested terminals.

April 7: Los Angeles, Long Beach Port Terminals Shut Down Due to Labour Issues – Supply Chain Dive

Terminals at the Port of Los Angeles and Port of Long Beach effectively shut down as a result of a local longshore labour action that began on the evening of April 6.

The Pacific Maritime Association, which represents West Coast port employers, said a local union at the twin ports withheld some labour for the evening shift on April 6, leading to widespread labour shortages that halted operations. The actions continued, leading to closures on the morning of April 7 as well.

April 12: China’s Container Depots Fill Up as Exports Feel the Pinch – The Loadstar

Container depots in China are full and having to turn away new customers, following a slowdown in exports.

Container xChange CEO Christian Roeloffs said: “We hear from many customers that the demand for containers is still there, just that the supply is overshooting the demand.

“Due to this, we see ripple effects, such as depots working at maximum capacity and not being able to accept new clients.”

Container xChange’s latest report suggests China’s container depots are working at 90% utilization, adding: “Oversupply makes it harder for the depots to move boxes. And because depots make money by moving these boxes, as opposed to storing them, the current circumstances are rendering the depots inefficient in both operations as well as revenue generation.”

The increasing number of idle containers at terminals does not only mean ports are getting congested, but repositioning empty containers has become more expensive and inconvenient, making it difficult for the NVOCCs and shipping lines to open new markets globally.

April 13: Nanaimo Studies Port Expansion – Inside Logistics

The Nanaimo Port Authority has received federal funding to study the potential for expanding its facilities. The Port of Nanaimo is on the east coast of Vancouver Island, across the Strait of Georgia from Vancouver.

The federal government has committed up to $600,000, under the National Trade Corridors Fund, for the Nanaimo Port Authority to study the expansion of container handling capacity; the development of land near the port to support economic growth, job creation and trade; and the assessment of potential improvements to the transportation of cargo by sea over short distances between Vancouver Island and the Lower Mainland.

April 20: Government of Canada Approves Roberts Bank Terminal 2 Project in British Columbia, Subject to Strict Conditions to Protect the Local Environment – Government of Canada press release

Following an environmental assessment conducted by an independent review panel and significant work to address concerns highlighted by the panel report, the Government of Canada has decided the Roberts Bank Terminal 2 Project can proceed subject to 370 legally binding conditions to protect the environment, including to prevent harm to local species.

The project will increase the Port of Vancouver’s capacity by 50 percent.

The port can now apply for the additional authorizations and permits it requires from federal departments, as well as from the Government of British Columbia. This includes from Fisheries and Oceans Canada under the Fisheries Act and the Species at Risk Act.

April 20: ILWU, PMA Reach Tentative Deal on ‘Certain Key Issues’ – Supply Chain Dive

The International Longshore and Warehouse Union said in a press release Thursday that negotiators had reached a tentative deal on “certain key issues” with the Pacific Maritime Association. The longshore union did not specify which issues the new tentative agreements cover, and declined to share further comments.

The news marks the first deal publicly announced since July 26.

April 24: As Asia-U.S. Shipping Rates Rise, So Does Skepticism on Staying Power – American Shipper

Container lines have used general rate increases (GRIs) to forcibly push up Asia-U.S. spot rates, yet there’s widespread skepticism on rates’ staying power given the gravitational pull of weak demand.

Carriers introduced a round of GRIs on April 15 and are scheduled to implement the next round on May 1. But Linerlytica reported Monday that carriers are “already deferring the May 1 GRI” to mid-May because “cargo volumes are unable to support rate hikes despite the blank sailings planned in early May.”

April 28: Soft Demand Pushes Ocean Spot Rates to ‘Their Lowest Sustainable Level’ – The Loadstar

Weak demand in the three major ocean trades, coupled with the expected flood of new tonnage, will feed declining rates, according to the latest report by Maritime Strategies International (MSI).

And ONE CEO Jeremy Nixon said on April 28: “Demand in the last quarter [Q1 23] has been significantly weaker than the previous two years’ first calendar quarters.” But, he added, this was not unexpected, “since the COVID 2022 recovery cycle brought strong inventory ramp-up programs for consumer merchandise.”

Even though Nixon believes there has been an over-correction affecting sales and inventory levels, ONE is not expecting any signs of recovery until June or July.

MSI’s report describes spot rates as being “at their lowest sustainable level,” but they are stable, whereas contract terms are still under negotiation for many and “there is further room for weakening in terms of contract freight rates.”

 

 

Air

April 6: Sporadic Strikes in France Are Causing European Flight Chaos – American Journal of Transportation

Walkouts among French air traffic controllers have led to thousands of flight cancellations since the start of the year. The French civil aviation authority DGAC has asked airlines to limit the number of flights on and off for weeks at Paris Orly and some other airports, at a time when the nation is being roiled by strikes over an unpopular pension reform.

Labour action by air traffic controllers not only affects flights to and from France but also leads to turmoil elsewhere in Europe, causing delays for planes that fly over the country to reach other destinations.

Ryanair Holdings Plc, Europe’s biggest low-cost airline, has gone so far as to ask passengers to sign an online petition urging European Commission President Ursula von der Leyen to “keep EU skies open” amid the walkouts. Twenty-five days of strikes among French air traffic controllers in the first three months of the year forced it to cancel 3,080 flights, leaving more than half a million passengers stranded with short notice, the carrier said.

April 18: WestJet Pilots Vote in Favour of Strike Mandate, Could Walk Before May Long Weekend – CBC News

The union representing WestJet pilots says they have voted overwhelmingly in favour of a strike mandate.

The Air Line Pilots Association says the 1,600 WestJet pilots it represents can launch a strike as early as the week leading up to the May long weekend.

April 20: WestJet Eyes Latin America as Freighter Services Set for Takeoff – Air Cargo News

On April 22, WestJet will launch its first-ever freighter service following the certification of its 737-800 Boeing converted freighters in March. The operation will initially start with three 737-800BCFs flying between Calgary, Halifax, Toronto, Vancouver, Los Angeles and Miami.

However, WestJet executive vice president for cargo Kirsten de Bruijn said that the carrier hopes to expand flights into Latin America after it adds its fourth 737, currently in modification in Costa Rica.

De Bruijn wouldn’t be drawn on exactly which countries the airline would target – as the carrier is still in the process of registering the aircraft in those countries – but said that they are likely to be in the northern part of Latin America.

Due to the range of the aircraft, the flights will need to include a stop in the U.S. to avoid breakage in the maximum payload, which for the 737-8000BCF is around 23 tonnes.

 

 

Rail

April 14: Canadian Pacific and Kansas City Southern Combine to Create CPKC – CPKC press release

Canadian Pacific and Kansas City Southern have combined to create Canadian Pacific Kansas City, as authorized by the U.S. Surface Transportation Board’s March 15, 2023 final decision, creating the first single-line railway connecting Canada, the U.S. and Mexico.

With its global headquarters in Calgary, CPKC is the only railway connecting North America and has port access on coasts around the continent, from Vancouver to Atlantic Canada to the Gulf of Mexico to Lázaro Cárdenas on Mexico’s Pacific coast. While remaining the smallest of six U.S. Class 1 railroads by revenue, the new combined company has a much larger and more competitive network, operating approximately 20,000 miles of rail, and employing close to 20,000 people.

Full integration of CP and KCS is expected to take place over the next three years, unlocking the benefits of the combination.

April 24: CN, UP and GMXT Announce New Mexico-U.S.-Canada Intermodal Service – American Journal of Transportation

CN, Union Pacific Railroad and GMXT have announced the creation of Falcon Premium intermodal service, a Mexico-U.S.-Canada service with a seamless rail connection in Chicago, Illinois. It will directly connect all CN origin points within Canada and Detroit, Michigan to GMXT terminals in Mexico: Monterrey, Nuevo Leon, and Silao, Guanajuato.

 

 

Trucking

April 3: Trailer GHG Rules Delayed at Least One More Year – Today’s Trucking

Canada’s federal government is suspending proposed greenhouse gas (GHG) emission standards for trailers by up to one additional year, while a U.S. proposal on which those standards are based remains stalled.

Under proposed rules, trailer manufacturers would need to adopt fuel-saving technologies like side skirts and automatic tire pressure monitoring systems. But the United States Court of Appeals for the District of Columbia determined the EPA and NHTSA couldn’t apply such rules south of the border because trailers are not “motor vehicles.”

April 4: Owner-Operators Sound Off to FMCSA on Need for More Light on Brokered Rates – Overdrive

In an effort to gather more feedback from motor carriers and freight brokers regarding recent guidance and proposals related to brokers, the Federal Motor Carrier Safety Administration held a listening session on March 31, at the Mid-America Trucking Show.

During the session, FMCSA officially announced it would be issuing another rulemaking proposal at a later date, as it had granted a petition from the Owner-Operator Independent Drivers Association regarding brokered transaction transparency.

“It’s important to note that the decision to grant these petitions and commence a rulemaking proceeding does not mean that the regulatory changes in question will ultimately be adopted,” said Ken Riddle, FMCSA Office Director, Registration and Safety Information. “FMCSA determines whether a proposed provision is adopted as part of a final rule on the basis of all available information developed in the course of the rulemaking proceedings.”

April 5: Detroit-Windsor Truck Ferry Can’t Secure Funding, Plans to Close in September – Today’s Trucking

Efforts by the Detroit-Windsor Truck Ferry to secure government funding to continue operations in light of declining hazmat traffic have been unsuccessful, and the ferry will close at the end of September.

Ferry president Gregg Ward said that, “after September there will be no legal border crossing in Detroit-Windsor for flammable, corrosive, infectious, radioactive and explosive materials, until the Gordie Howe [bridge] opens in later 2025. Also, there will be no local border crossing for trucks over 12-ft. wide. As well, during border emergencies, there will be no local outlet for critical freight.”

Trucks carrying hazardous materials are not permitted to cross the Ambassador Bridge. When the ferry shuts down in the fall, Ward noted that hazmat vehicles will have no legal border crossing options at Windsor-Detroit. The detour to the Blue Water Bridge adds about $500 in costs and five hours of additional travel.

April 12: U.S. Vaccination Mandate Remains at Borders – Today’s Trucking

U.S. President Joe Biden has ended the national COVID state of emergency this week, but the border vaccination requirement for Canadians remains in place.

Previously, all COVID-related emergencies were slated to end May 11. The Canadian Trucking Alliance (CTA) has confirmed the vax mandate remains in place for non-U.S. citizens, including cross-border truckers.

April 21: Economic Trucking Trends: Q1 Earnings Paint Grim Picture as Freight Conditions Deteriorate – Today’s Trucking

Publicly traded U.S. fleets have begun reporting Q1 earnings, and they aren’t pretty. Spot market rates continue to be below operating costs, squeezing smaller carriers out of the marketplace. But equipment demand remains healthy, albeit at lower levels than we’ve seen.

Truck tonnage has seen its sharpest decline since the start of the pandemic, and industry forecaster FTR has reported worsening overall trucking conditions.

These are some of the economic highlights (lowlights?) from last week, delivered in the first Today’s Trucking’s weekly Economic Trucking Trends roundup.

April 28: U.S. Trucking Bloodbath Snares Fleets Large and Small – FreightWaves

America’s $875 billion trucking industry is struggling.

The number of authorized interstate trucking fleets in the U.S. declined by nearly 9,000 in the first quarter of 2023, according to federal data analyzed by Motive, a fleet management technology company. Several midsized fleets have already shuttered this year, and major freight brokerages have laid off 1,000 employees in 2023 alone.

Per FreightWaves’ Outbound Tender Rejection Index, trucking fleets are rejecting about 2.8% of load requests. That makes “early 2023 the softest sustained truckload market since the tender data history began in early 2018,” said FreightWaves’ Zach Strickland.

April 30: Reported Cargo Thefts Rise Sharply, and That’s Just Part of the Story – Today’s Trucking

The trucking industry is facing a sharp increase in cargo theft, even as insurance providers and police forces say the crime is underreported by those who suffer the losses.

Since last year, cases of cargo theft increased nearly 80% in Canada and the U.S., says Keith Lewis, vice-president of operations at Verisk’s CargoNet, which reports thieves stole $223 million worth of freight in 2022. Trucking-related fraud cases are up 700%.

In Canada alone, reported cargo losses increased 29.8% last year, compared with 2021, says Bryan Gast, vice-president, investigative services at Équité Association. Ontario continues to see the highest activity, accounting for 62% of total recorded cargo thefts in the country.

 

 

CIFFA Advocacy, Communications, Activities

April 3: New CIFFA White Paper: Double Brokering in the Canadian Trucking Industry – CIFFA website

For freight brokers, the practice of double brokering poses potential legal and commercial risk.

CIFFA’s new white paper on this topic addresses three areas of enhanced commercial and legal risk where loads are brokered out by a selected carrier and something goes wrong during transit or in the freight billing cycle.

Maritime

March 1: ONE’s Nixon Says Decarbonizing Shipping Could Add $2,000-$3,000 per Container – American Journal of Transportation

Ocean carriers should focus on transitioning from fossil fuels to decarbonized green fuels but expect an added cost of between $2,000 and $3,000 per 40-foot container, warned Jeremy Nixon, CEO of Ocean Network Express (ONE).

Nixon said an international regulation or carbon tax will be needed so that all ocean carriers make the investment together and not allow for some carriers to opt out, continuing to operate with cheaper fossil fuels that will allow them to undercut decarbonized ocean carriers.

Nixon explained the process by which the adoption of green fuels would add to the cost of a 40-foot container: “First, we have got to get the green fuel. So, the key three solutions, which are really methanol, ammonia, potentially synthetic LNG … require a lot of green hydrogen. Many other industries are competing for green hydrogen, so we need to make this call to all governments, to the IMO (International Maritime Organization). We need to accelerate the production of green hydrogen across the energy companies.”

March 2: Prince Rupert Port Authority Announces Milestone on Ridley Island Export Logistics Project – press release

The Prince Rupert Port Authority (PRPA) announced that the Ridley Island Export Logistics Project (RIELP) has reached a significant milestone with the receipt of its final determination of the federal environmental effects evaluation review.

Federal authorities have determined that the Ridley Island Export Logistics Project is not likely to cause significant adverse environmental effects. The conclusion of the environmental review process is a prerequisite for the federal authorities to consider the required authorizations for the project to proceed.

Planned for the southern end of Ridley Island, the export logistics complex will be an integrated ecosystem of large-scale bulk and breakbulk transload facilities, intermodal rail yard and a container storage yard. The development will create a transloading facility for commodities such as plastic pellets, cereal grains, specialty agriculture crops, lumber and pulp to be loaded directly from rail into containers for export, creating 400,000 TEUs of export capacity in the first phase.

March 2: Transpacific Ocean Carriers Hope to Regain Trust of Shippers Burned During Pandemic Supercycle – gCaptain

Ocean carriers attending the S&P Global TPM conference last week owned up to mistakes over the past two years and are jockeying to rekindle relationships with shippers.

“Being back in front of the customer is the number-one priority for us right now,” said Peter Levesque, new president of CMA CGM in North America.

Levesque told the audience “a lot of things went wrong” with carrier-shipper relationships, but he suggested it was now time to “draw a line and learn from those mistakes.”

March 6: Container Shipping Market Yet to Bottom as Spot Rates Keep Slipping – FreightWaves

Xeneta CEO Patrik Berglund said in late November that, if spot rates had not stabilized and started to rise again by the first and second quarters of this year, “carriers have played this market really badly.”

By that definition, ocean carriers have played this market really badly.

Spot indexes are not plummeting like they were in the second half of 2022, but they’re still inching downward week after week. The market bottom is proving elusive as transport capacity continues to exceed demand.

March 13: Infrastructure Upgrade Sparks Cargo Logjam at Nhava Sheva Port in India – The Loadstar

Container terminals in Nhava Sheva Port (JNPT), India’s busiest public gateway, have been hit by congestion.

The problem is due to drastic capacity reduction at APM Terminals Mumbai, which accounts for the majority of export/import shipments moving through the gateway. Sources noted that the number of weekly services handled by APMT Mumbai, also known as Gateway Terminals India (GTI), had reduced from the normal 13 calls to six, due to the closure of a berth for crane upgrades.

“Spill-over berthing demand has complicated flows through other terminals,” a shipping line agent said.

March 13: Lake Superior Port Being Developed as Link to Northern Ontario’s Resource-Rich Ring of Fire – Inside Logistics

The northernmost heavy-cargo port on the Great Lakes is being developed by the BMI Group and the Red Rock Indian Band.

The two groups signed a memorandum of understanding (MOU) that will allow them to explore the redevelopment of lands formerly used by a linerboard mill in Red Rock, Ontario, as a deep-water port. Red Rock is on the northernmost shore of Lake Superior, just off the Trans Canada highway, about 110 km northeast of Thunder Bay.

The Red Rock Integrated Marine Supply Chain, RRIM SC partnership between the BMI Group and the Red Rock Indian Band intends to connect the Great Lakes seaway to existing transportation infrastructure from the Red Rock port through to the Trans-Canada Highway and the northern Community Infrastructure Corridor.

March 14: Containers Outbound from Montreal Undergoing Extra CBSA Scrutiny – Inside Logistics

The Canada Border Services Agency (CBSA) has stepped up inspections of export containers leaving the Port of Montreal.

In a note to customers, Maersk said that, as of March 1, CBSA had increased the number of export exams in Montreal. Containers are being referred to the Entrepôts LaFrance examination facility for a full destuffing and exam.

The customs agency is stepping up the inspections to try to intercept increased stolen property and contraband being exported from Canada.

Maersk said customers should expect delays if an export container is selected for a full destuffing and inspection.

March 15: 3PL Sues Shipper for US$20 Million in Unpaid D&D Charges – The Loadstar

The fractious relationship between shippers and logistics service providers over D&D charges and billing has reached new heights: Expeditors is suing a customer of more than 10 years for withholding some $20 million in payments.

Expeditors said, “the vast majority of the amounts owed to Expeditors consisted of pass-through demurrage and detention charges from the underlying ocean carriers and marine terminal operators, which Expeditors had long since paid on Kohler’s behalf.”

March 16: Wan Hai Fined by U.S. Federal Maritime Commission – Splash

Taiwan’s Wan Hai Lines has become the latest carrier to feel the wrath of the U.S. Federal Maritime Commission (FMC), copping a $950,000 fine as well as agreeing to refund charges in a detention and demurrage case that dates back to 2021.

Wan Hai invoiced a customer at least 21 times in the spring of 2021 for detention charges when the carrier “either offered no return locations, the designated terminal was not accepting the containers’ chassis, or appointments were unavailable for the subject containers,” according to the FMC’s order of investigation and hearing.

March 17: New U.S. FMC Rule Expands Shippers’ Eligibility for Carrier Refunds – FreightWaves

A new rule requiring ocean carriers to refund importers and exporters for illegal overcharges and potentially for other violations of the U.S. Shipping Act will go into effect next month.

The changes, set out in a final rule scheduled to be published by the Federal Maritime Commission on March 20, are in the form of amendments to the FMC’s Rules of Practice and Procedure governing the assessment and collection of civil penalties. They codify provisions included in the Ocean Shipping Reform Act (OSRA) of 2022.

FMC’s rule explains that before OSRA 2022, any person violating the Shipping Act – or a regulation or order of the FMC issued under that law – is liable for a civil penalty. OSRA 2022, however, changed the language in the Shipping Act governing potential liability of a violator by adding the phrase “or, in addition to or in lieu of a civil penalty, is liable for the refund of a charge.”

Customer refunds are also included in a new provision enacted by OSRA 2022 that addresses the issue of charge complaints, such as inappropriately charging or overcharging for demurrage and detention.

March 20: Crunch Time for Trans-Pacific Container Shipping Contract Talks – FreightWaves

The annual contract season is down to the final stretch in the trans-Pacific shipping market. Import costs, liner profitability and service reliability all hinge on where contract prices settle in the next few weeks.

The plot twist this year is that the prior round of annual contracts were signed at historically high levels and the timing of the current contract RFP season coincides with a period of still-sinking spot rates.

Import demand remains weak due to bloated inventories, with inbound volumes reminiscent of spring 2020, when the culprit was COVID lockdowns.

The risk ahead: If shipping lines cannot obtain enough contract business at rates sufficient to cover costs as a result of weak demand and falling spot rates coinciding with the 2023 contract RFP season, the lines could take drastic action and cut much more capacity in the trans-Pacific, reminiscent of what they did in 2020.

March 20: ILWU Canada Seeks Conciliation in Talks with BCMEA – news post on ILWU Canada website

The ILWU Canada Bargaining Committee has filed a notice of dispute with the Federal Mediation and Conciliation Service. The union said in a post on its website that it is taking this action “because there has been no meaningful progress with the BCMEA in discussions to renew the Industry Collective Agreement.”

The union is seeking to have the Minister of Labour appoint a conciliation officer to assist the parties in their negotiations.

March 21: Measuring the Carbon Footprint of Vessels at the Port of Montreal – press release from the Port of Montreal

The Montreal Port Authority (MPA) and Global Spatial Technology Solutions (GSTS), a company that specializes in applying artificial intelligence (AI) to shipping, announced the launch of a new project to measure and reduce the carbon footprint of vessels using the Port of Montreal that makes the most of artificial intelligence.

The project provides real-time data on the route, speed and position of vessels heading to Montreal. These data are then analyzed to obtain an accurate estimate of a vessel’s arrival time and adjust its route to coordinate with the availability of berths in the Port of Montreal. This makes it possible for ships to optimize their sailing speed, which in turn reduces fuel consumption and GHG emissions, shortens anchoring time before docking, and benefits operational planning and optimization.

Ultimately, the digital corridor concept will enable accurate, real-time communication between ports, terminal operators and ocean carriers to improve operational efficiency and decrease GHG emissions.

March 22: The ‘Mother of All BAFs’ May Loom for Shippers as Green Targets Advance – The Loadstar

Shippers are concerned that maritime discussions on decarbonization are shaping up to result in “the mother of all BAFs” for shippers, as carriers will seek to pass on the costs of using sustainable fuels.

The International Maritime Organization (IMO) is set to meet in July and is widely expected to increase its ambition of a 50% reduction in carbon emissions by 2050 to 100%, and will also discuss market-based measures, such as a carbon levy.

To achieve the new target, the maritime sector will need to invest heavily in the technology needed, with some of these processes already under way, with methanol testing, ammonia and LNG all a possibility.

Costs related to decarbonization are difficult to estimate, but Drewry Shipping Consultants director Philippe Damas, in a Linkedin discussion on the EU Emissions Trading System, said: “Drewry estimates that on the major Asia-North Europe route, these combined policy measures will increase bunker costs and emission-related taxes or allowances from $312 per 40ft container for very low-sulphur fuel oil today to $568, or about $458/40ft using methanol, a low-carbon fuel.”

March 23: Vancouver Fails to Get ILWU Canada Support for RBT2 – WorldCargo News

The Vancouver Fraser Port Authority (VFPA) has failed in its effort to get the International Longshore and Warehouse Union Canada (ILWU Canada) to lobby the federal government to support its proposed new Roberts Bank Terminal 2 development.

The federal government is currently considering the final environmental assessment for RBT2. The VFPA has been conducting a lobbying campaign in Ottawa for months now to try to get a favourable decision and working to line up support for the project in Vancouver and across Canada.

Earlier this year, the ILWU wrote an open letter to the Government of Canada asking that it deny the environmental permits for reasons including its concerns about automation. The ILWU is concerned that RBT2 will bring in a higher level of automation than currently exists in Vancouver. There are some remote-controlled RMGs at the rail interface at Deltaport and at DP World’s terminal in Vancouver, but it is believed they are operated with one operator to each crane. As the ILWU sees it, RBT2 will bring a higher level of automation to the port, creating a precedent that existing terminals will be forced to follow to remain competitive.

After the ILWU Canada came out against RBT2, the VFPA tried to get the union to change its mind and support the terminal in return for a commitment from the port to “ensuring the terminal will be an ILWU-certified facility.”

March 27: Container Shipping Can See ‘Green Shoots’ of Freight Demand Recovery – The Loadstar

Some liner services are reported to have full ships again, container spot rates have stabilized, the charter market is bullish and ocean carriers are back at shipyards ordering new tonnage.

It seems the week has started positively for carriers and shipowners, with ‘green shoots’ of a recovery starting to emerge.

The March 27 Ningbo Containerized Freight Index (NCFI) commentary reports that, during the past week, container spot rates increased on 15 of the 21 export routes it tracks from the Chinese port.

For instance, on the key Asia to Europe tradelanes, it says “some voyages sailed with full loads” and that carriers had “pushed up market rates for April voyages.”

March 27: Trans-Atlantic Container Rates Still Double Pre-COVID Levels – FreightWaves

Container shipping rates are not back to normal quite yet. Trans-Pacific rates have returned to pre-COVID levels, but pricing in trans-Atlantic markets has not.

Spot container rates from Europe to the U.S. – while falling – are still more than twice pre-pandemic rates.

The Drewry World Container Index (WCI) spot-rate assessment for Rotterdam, Netherlands, to New York was $5,061 per forty-foot equivalent unit in the week ending Thursday. That’s down 32% from last year’s peak but still 2.5 times rates in March 2019.

Asia-West Coast spot rates shot far higher than trans-Atlantic rates during the 2021-2022 shipping boom but came down faster and fell further. The WCI Rotterdam-New York spot-rate assessment was 2.7 times higher than the Shanghai-Los Angeles index assessment last week.

March 28: FMC Wants Ocean Carriers to Prove Detention, Demurrage Charges Comply with OSRA – Supply Chain Dive

The U.S. Federal Maritime Commission is requesting details from 11 ocean carriers and marine terminal operators proving that their detention and demurrage surcharges comply with the Ocean Shipping Reform Act, according to a March 23 press release.

The agency is asking the carriers to attest and show policies and practices through its Vessel-Operating Common Carrier audit program.

COSCO, CMA CGM, Evergreen, Hapag-Lloyd, HMM, Maersk, MSC, ONE, OOCL, Yang Ming and ZIM are the carriers in question.

March 31: Shippers Pushed Towards Spot Rates as Contract Negotiations Stall – The Loadstar

While container spot rates on the Asia-Europe and transpacific tradelanes appear to have reached a nadir, start dates for many new long-term contracts remain uncertain.

Indeed, with contract negotiations stalled and demand weak, shippers, BCOs and NVOCCs are switching a much higher percentage of their business to the spot market.

In fact, carriers are actively encouraging their contract customers to book cargo via spot, rather than lose them to cheaper competitors and have to buy them back later.

The Asia to North Europe component of the Freightos Baltic Index (FBX) was flat this week, at an average of $1,349 per 40ft, and it is clear that carriers are prepared to do whatever it takes, in terms of capacity management, to prevent rates on the route dipping below $1,000.

 

 

Air

March 2: ‘Time for a New Baseline’ as Air Cargo Capacity Rose Above Pre-Pandemic Level in February for First Time in 4 Years – American Journal of Transportation

Global air cargo volumes fell 4% year on year in February, as available cargo capacity rose above the pre-pandemic level for the first time in four years, according to the latest weekly market analysis from CLIVE Data Services, part of Xeneta.

Global air cargo capacity increased for the eleventh consecutive month in February, up 11% on the same period last year. The global average air freight spot rate of US$2.73 per kg declined 35% year on year but remained 52% ahead of the pre-COVID level seen in 2019.

Niall van de Wouw, Chief Airfreight Officer at Xeneta, said the latest data means it’s time for the industry to let go of pre-COVID comparisons and to acknowledge a new baseline for air cargo market growth.

“The fascination and rhetoric around airfreight rates going back to the 2019 level needs to be replaced based on the inflationary components we now see. Name me a service or product that you acquired four years ago that you’re still paying the same price for now. The air cargo industry should be focused on where growth is going to come from because the general air cargo volumes have seen negative growth for four years and, based on the first two months of 2023, are still -8% in terms of chargeable weight compared to four years ago. That is not a growth market,” he said, adding 2019 was also a relatively weak year for air cargo after a buoyant 2018.

March 6: Disjointed EU PLACI Rollout Risks Customs Clearance Delays – IATA press release

The International Air Transport Association (IATA) calls for urgent action to address the disjointed rollout of the EU’s new Pre-Loading Advance Cargo Information (PLACI) System. PLACI went live on March 1 despite 12 European states not being ready and not having given definitive information about their timelines for readiness. As a result, there is a risk of exacerbating supply chain difficulties with customs clearance delays.

Some of Europe’s biggest air cargo hub airports are located in the 12 states that are not PLACI ready: Austria, Belgium, Croatia, Denmark, Estonia, France, Greece, Luxemburg, the Netherlands, Poland, Romania, and Sweden.

“The delayed implementation of PLACI in 12 European states must be urgently addressed. With supply chain difficulties already impacting people and businesses, the risk of increased delays for customs clearance must be avoided. It is exasperating that 12 European governments have not met the implementation timeline and have yet to provide definitive indication of when they will be ready. These states must urgently provide the necessary clarity to enable airlines to adapt their own implementation planning,” said Brendan Sullivan, IATA’s Global Head of Cargo.

March 17: Global Tonnages Flatten as Average Rates Further Soften – Air Cargo Week

Global air cargo tonnages appear to have stabilized following their post-Lunar New Year bounce-back in recent weeks and their steady decline throughout most of last year, while average rates continue their gradual softening trend, the latest preliminary figures from WorldACD Market Data indicate.

Figures for week 10 (March 6 to 12) show a small decrease (-1%) in worldwide tonnages compared with the previous week, which had seen a modest tonnage rise (+1%). On the pricing side, global average rates remained stable compared with the previous week.

Comparing weeks 9 and 10 with the preceding two weeks, tonnages are up by 2% above their combined total in weeks 7 and 8, accompanied by a 2% increase in capacity, whereas average worldwide rates slightly declined by 2% – based on the more than 400,000 weekly transactions covered by WorldACD’s data.

March 20: WestJet Freighters Set for Takeoff Following Conversion Approval – Air Cargo News

Transport Canada has certified WestJet’s four B737-800 Boeing converted freighters, meaning the airline can now launch all-cargo operations.

Until now, the airline has been unable to use its freighters as Boeing awaited certification of its conversion program.

Now that approval has been given, WestJet Cargo and partner GTA Group will “expeditiously implement three freighters into service” with the first flight expected on April 22. The fourth of WestJet Cargo’s freighters is expected to join the fleet later this year following the completion of its conversion.

March 29: Airfreight Rates Climb on the Transpacific in March – Air Cargo News

Transpacific airfreight rates picked up in March, although there were further declines from Hong Kong to Europe and across the Atlantic.

The latest statistics from the Baltic Exchange Airfreight Index show that prices from Hong Kong to North America in March increased by 9% compared with February, to $5.38 per kg.

Prices from China to the U.S. were also up, increasing by 7.8% in March compared with February.

“Sources cited an ‘end-of-quarter rush’ particularly in e-commerce and garments ahead of Easter – though [they are] also expecting prices to soften again,” stated data provider TAC Index in its weekly market round-up.

March 31: WestJet Pilots Set to Launch Strike Authorization Vote as Negotiations Fizzle – CBC News

The union representing WestJet pilots will launch a strike authorization vote on March 31 as contract talks with management drag on, the Air Line Pilots Association said.

Bernard Lewall, who heads ALPA Canada’s WestJet contingent, said its 1,600-person membership is “frustrated” after six months of bargaining with a company he claims has failed to seriously engage with it.

The issues revolve around wages, scheduling and work conditions at WestJet and its discount subsidiary Swoop, with 39 pilots opting to leave for other airlines in the past month alone, Lewall said in a phone interview from Calgary.

 

 

Rail

March 6: CN Workers Back Union Strike Mandate as Contract Talks for 3,000 Employees Continue – Global News

CN workers backed a strike vote with negotiations set to resume on a contract for around 3,000 Canadian employees.

Unifor announced on March 5 that workers with Local 100 are 98 percent in favour of a strike, while those with Council 4000 voted 97 percent to back job action.

The union says the two sides are in the final stages of negotiations, with another round of talks set for next week.

March 7: Head of Steam Building Against U.S. Freight Railways after New Derailment – The Loadstar

The heat is piling up on Class I rail companies after yet another Norfolk Southern (NS) train derailed in Ohio, barely a month after the catastrophic derailment of a 150-car NS train in the state.

Legislators are up in arms over the rail industry’s safety record and are preparing legislation to tighten safety measures.

Despite the minor impact of the March 4 derailment, it caused outrage across the U.S. Senate. Senator Sharrod Brown from Ohio pointed out that NS had suffered four derailments in the state in five months. He called this “unacceptable” and accused the railway of putting profit margins before safety, while Mike Turner, who represents the area of Saturday’s crash, called the derailments “outrageous.”

NS CEO Alan Shaw is due to testify before a Senate committee on Thursday and is bound to face a hostile audience.

In the aftermath of the derailment in East Palestine last month, U.S. transportation Secretary Pete Buttigieg called on the railways to end their aggressive lobbying efforts and resistance to safety legislation.

Momentum for tougher rules on railway safety has seen a rare show of unity of members of both parties on Capitol Hill. A proposal before the Senate, endorsed by President Biden, aims for higher fines for safety violations, tougher rules for trains carrying hazardous materials, increased funding for hazmat training, accelerating replacement of older tank cars with more robust models and a minimum of two persons manning a train.

March 15: Canadian Pacific and Kansas City Southern Combination Approved by U.S. Surface Transportation Board – press release from CP

The U.S. Surface Transportation Board (STB) issued a decision on March 14 approving the Canadian Pacific and Kansas City Southern joint merger application, subject to certain conditions, thereby authorizing the two railways to combine to form Canadian Pacific Kansas City (CPKC), the first single-line railway connecting the U.S., Mexico and Canada.

The decision authorizes CP to exercise control of KCS as early as April 14, at or after which point CP and KCS will combine to create the new CPKC. CP is reviewing the full 212-page decision in detail and in the coming days will announce its plans with respect to the creation of CPKC.

March 17: CP Sets Date for Combination with KCS, Announces CPKC Executive Leadership Team – press release from CP

Canadian Pacific will on April 14 exercise the authority granted by the U.S. Surface Transportation Board’s final decision and combine with Kansas City Southern to create Canadian Pacific Kansas City (CPKC), the first and only single-line railway connecting the U.S., Mexico and Canada. CP also announced the executive team that will lead CPKC.

March 20: CN and Unifor Reach Tentative Agreements, Avoiding a Potential Strike – press release from CN

CN has reached new tentative collective agreements with Unifor. The collective agreements cover approximately 3,000 CN employees working in various departments such as Mechanical, Intermodal, Facility Management, and in clerical positions in Canada.

No details of the tentative agreements will be released publicly until the agreements are ratified.

 

 

Trucking

March 6: Quebec Fleets Frustrated by Problems with New SAAQclic Platform – Today’s Trucking

Quebec fleets are reporting an array of problems with the Société de l’assurance automobile du Québec’s new SAAQclic platform, ranging from denied registration processes, to delays and active fleets identified as being shelved.

“Things are still complex in some cases,” Quebec Trucking Association (QTA) CEO Marc Cadieux said, referring to the platform launched February 20. His members have complained the system is slow, and that appointments are set far into the future.

But there were also unpleasant surprises for some carriers when they went to consult their file. “With amazement, they saw that their fleet, or part of their fleet, was erroneously identified as being scrapped,” Cadieux said.

The QTA leader has expressed concerns about the registration renewal processes to Minister of Transport and Sustainable Development Geneviève Guilbault. “We are concerned that we will not be able to complete all registration renewals by March 31 if the situation does not improve, and this makes us fear that there will be a disruption in the supply chain,” he said.

March 13: Manitoba Legislation Targets ‘Chameleon Carriers’ – Today’s Trucking

Manitoba is looking to target “chameleon carriers” – businesses that close and reopen under a different name rather than addressing safety issues – by assigning “conditional” safety ratings to operations thought to be doing that very thing.

Current rules don’t allow the Department of Transportation and Infrastructure to refuse to issue a safety certificate under such circumstances.

New carriers must identify a certified compliance officer and submit a safety plan before being issued a safety fitness certificate. Existing carriers with a “conditional” safety rating must certify a compliance officer within 180 days.

March 13: Quebec Announces New Measures, Extends Registration for Truckers amid Ongoing Crisis at SAAQ – Global News

The Quebec government is introducing another wave of measures to ease the ongoing customer service crisis at the province’s automobile insurance board.

The Société de l’assurance automobile du Québec (SAAQ) has been dealing with lengthy lineups at many of its service centres since its so-called digital transformation. It introduced a new online portal on February 20, which users have had trouble accessing due to an authentication issue.

Under the latest plan, registrations for truckers and transportation companies will be valid for an additional 90 days, giving drivers more time to renew their registrations.

March 14: Three Red Flags That Could Signal a Double-Brokerage Scheme – Transport Dive

The Owner-Operator Independent Drivers Association compliance team receives about 10 to 15 calls a week from unfortunate truck drivers with similar stories.

The drivers tell about hauling a load only for the broker who hired them to disappear. When the driver brings the bill to the legitimate broker, they often aren’t aware the shipment was rebrokered. “This double-brokering scam, it’s just so prolific,” said Tom Crowley, a regulatory specialist at OOIDA. “It’s everywhere.”

OOIDA and the Transportation Intermediaries Association, which represents freight brokers, disagree on plenty. But they share a common cause in eliminating fraud, which can hurt each group’s members financially.

 

 

CIFFA Advocacy, Communications, Activities

March 27: CIFFA Letter Regarding Canada’s West Coast Ports Labour Negotiations

CIFFA has written to several government ministers to draw attention to the ongoing labour negotiations at Canada’s West Coast ports. The BCMEA and ILWU are negotiating two coastwide collective agreements on behalf of the Longshore Locals and Local 514 Ship & Dock Foremen.

CIFFA’s members regard this situation as potentially one of the most significant impacts on Canada’s economy, with the potential to create very significant disruptions, which would undoubtedly increase consumer costs, fueling additional inflation, and severely impact businesses relying on imports of equipment or exports of products.

CIFFA urged government to do everything in its power to ensure this bargaining process is well-supported and that the government is proactive and swift in taking action to protect Canadian business and consumers. Even the mere threat of a labour disruption will undermine the economic and social well-being of Canada.

Maritime

February 1: Cross-Alliance Cooperation on the Increase as Market Weakens – The Loadstar

Ocean carriers are pulling capacity from Chinese export routes and redeploying the ships to more robust tradelanes with growth potential.

Moreover, the weakness in the Chinese market is prompting more discussions on carrier slot swap agreements between rival alliances.

“Poor cargo demand in China and falling ocean spot freight rates have led to significant changes in global fleet deployment,” said Alphaliner.

February 3: Pressure on Carriers Drives Cut-Throat Freight Market for China’s Exports – The Loadstar

On the transpacific, Drewry’s WCI Asia to U.S. west coast reading was down 1% on the week, to $2,056 per 40ft, whereas the XSI saw a drop of 3%, to $1,529.

However, on the U.S. east coast, the Freightos Baltic Exchange FBX reading held steady last week at $2,660 per 40ft.

And transatlantic shippers are starting to see the impact of the significant injection of extra capacity on the route, with another 5% fall in the FBX North Europe to the U.S. east coast spot, to $4,956 per 40ft.

According to Vespucci Maritime CEO Lars Jensen, the immediate outlook for carriers is more of the same, with new rate wars looming across tradelanes.

He noted that volumes on the major deepsea trades were “either at, or below, pre-pandemic levels following the collapse which began in September.”

February 7: FMC Demands Answers from MSC over Congestion Surcharges – Splash

Using its newfound powers granted by President Joe Biden, the Federal Maritime Commission (FMC) has taken aim at the world’s largest containerline, Mediterranean Shipping Co (MSC).

The FMC is questioning a congestion fee MSC charged SOFi Paper Products in a first case of its kind since the passing last year of the Ocean Shipping Reform Act (OSRA). MSC has until the end of the month to explain why it should not pay a refund to SOFi.

The FMC said MSC never provided “justification” to SOFi stemming from a $1,000 “congestion surcharge” levied against SOFi in July.

February 9: Maersk Lays Out Integrator Plan: No New Alliance Post 2M – The Loadstar

Maersk has said that being a member of a vessel-sharing alliance (VSA) was “not compatible” with its global integrator aspirations.

And it sees the break-up of the 2M Alliance as “simply a transition from three to four networks,” as both MSC and Maersk decide to operate standalone services on east-west trades.

Taking questions during the company’s full-year and Q4 results presentation, CEO Vincent Clerc said he did not expect the end of the 2M VSA to induce a “role of musical chairs that has been talked about, with everybody trying to find new partners.”

He said: “Today there are three major networks on the east-west, in the future there will be four.”

February 10: Dockworkers Urge Trudeau to Sink Vancouver Port’s $3.5 Billion Terminal 2 Expansion Project – Business in Vancouver

The union representing Port of Vancouver dockworkers has delivered a strong thumbs-down to the Vancouver Fraser Port Authority’s (VFPA) proposed multibillion-dollar container terminal expansion project at Roberts Bank.

In a February 9 open letter to Prime Minister Justin Trudeau and the federal cabinet, the International Longshore & Warehouse Union Canada (ILWU) congratulated the federal government for successfully hosting the recent COP15 environmental summit but pointed to the VFPA’s $3.5 billion Terminal 2 expansion project as running counter to COP15’s aims to halt and reverse biodiversity loss by the end of the decade.

Terminal 2, which would add 2.4 million 20-foot equivalent units (TEUs) to the port’s annual container handling capacity, would require the construction of an artificial island in what Terminal 2 opponents point out is an environmentally sensitive marine area.

The ILWU also argues that the project’s sliding timelines and ballooning costs are a “major risk to all port tenants, operators and labour in an uncertain time.”

It also expressed concerns about Terminal 2’s automation and the subsequent job losses it would result in and the amount of money the port would need to borrow to finance the project.

February 14: Opening Date of Great Lakes-St. Lawrence Seaway 2023 Navigation Season – Seaway notice

The opening date for the 2023 navigation season is scheduled to take place as follows:

Ship transits will be subject to weather and ice conditions. Restrictions may apply in some areas until lighted navigation aids have been installed.

February 15: DCSA’s Member Carriers Commit to a Fully Standardized, Electronic Bill of Lading by 2030 – DCSA press release

The Digital Container Shipping Association (DCSA) has announced that its nine ocean carrier members commit to 100% adoption of an electronic bill of lading (eBL) based on DCSA standards by 2030. Switching away from the transfer of physical paper bills of lading could save $6.5 billion in direct costs for stakeholders, enable up to $40 billion in annual global trade growth, transform the customer experience and improve sustainability, said the association in a press release.

Manual, paper-based processes are time-consuming, expensive and environmentally unsustainable for stakeholders along complex supply chains. Paper-based processes break down when cargo in ports cannot be gated out because original bills of lading fail to arrive or cannot be manually processed in time. In contrast, digital processes enable data to flow instantly and securely, reducing delays and waste.

February 19: Shipping Containers with Billions of Dollars Worth of Imports Are Stuck at Pakistan’s Ports – gCaptain

A bunch of Pakistan’s biggest companies have halted operations in the past months as they ran out of raw materials or foreign exchange, or both, compounding the troubles of an economy that’s trying to avert a debt default.

The local unit of Suzuki Motor Corp. extended the shutdown of its manufacturing plant to February 21, according to a statement to the stock exchange, saying that parts shortages are persisting.

Ghandhara Tyre & Rubber Company, which manufactures tires and tubes for automobiles, had shut its plant from February 13, saying it’s facing “immense hurdles towards importing raw materials and obtaining clearance of consignments from commercial banks.”

Those are just two out of a cluster of listed companies that includes manufacturers of fertilizers, steel and textiles that have shut their factories indefinitely or suspend operations intermittently as they grapple with a shortage in inventory or cash, or even a drop in demand.

Pakistan’s $3.19 billion in foreign currency reserves mean that the nation is unable to fund imports, stranding thousands of containers of supplies on its ports and stalling production, putting jobs at risk. Inflation that’s also increasing at the fastest rate in almost half a century is putting many goods out of the public’s reach.

February 20: Three Months to Get Iskenderun Terminal Operations Back to Normal – Splash

Management at LimakPort Iskenderun, the Turkish container terminal badly battered in this month’s mega earthquake, have said it will take around three months to get operations back to normal.

The port was severely damaged in the wake of the February 6 earthquake and suffered structural damage, as well as a severe blaze as containers caught fire. The fire at the Mediterranean terminal was eventually put out after three days. Carriers have put in alternate calls to other ports in the region this month, something they will continue to do through to late spring.

A total of 3,670 containers were burnt in the fire, management has revealed and clean-up operations are now underway.

February 21: Centerm Expansion Project Complete, Increasing Port of Vancouver Container Capacity – Port of Vancouver press release

Construction on the Centerm expansion project at the Port of Vancouver is now complete.

The project focused on innovative ways to make best use of the limited trade-enabling industrial land available and allow Centerm to handle 60% more containers by increasing the terminal footprint by 15%. Work completed includes expanding the terminal footprint to the west and east, reconfiguring and expanding the container yard, building state-of-art truck gates, expanding the intermodal yard, building a new operations facility, and improving marine habitat.

While construction of the terminal improvements is complete, work is ongoing to optimize operations to deliver the full capacity increase at Centerm. The full capacity gains are expected to be realized later this year, increasing the terminal’s container handling capacity by two-thirds from 900,000 TEUs to 1.5 million TEUs.

February 23: Negotiators Say U.S. West Coast Longshore Contract Talks Continue, Hopeful of Deal Soon – Supply Chain Dive

The two parties involved in West Coast port labour talks said, “they remain hopeful of reaching a deal soon,” according to a February 23 joint news release.

The International Longshore and Warehouse Union and Pacific Maritime Association said they continue to negotiate and both sides agreed not to discuss negotiations with the media as bargaining continues.

So far, the two sides have reached a tentative deal on “certain key issues, including health benefits, and remain committed to resolving remaining issues as expeditiously as possible,” according to the release.

 

 

Air

February 10: WestJet Pilots Ask for Federal Assistance after Months of Failed Contract Talks – Global News

The union that represents pilots at WestJet says it is asking for federal assistance after months of failing to reach a contract agreement with the airline.

The WestJet Master Executive Council, represented by the Air Line Pilots Association, International (ALPA), says it has filed a request for conciliation assistance with the Federal Mediation and Conciliation Service.

The federal Minister of Labour now has 15 days to appoint a conciliation officer. Once appointed, the officer would work with the parties for 60 days to reach an agreement.

If the parties remain at an impasse following this period, a 21-day cooling-off period begins before the parties can consider other alternatives, including a strike or lockout.

February 12: Heathrow Airport Workers Plan to Ballot for Strikes, Union Says – American Journal of Transportation

Heathrow Airport’s security, engineering and firefighting staff represented by the Unite Union will next week begin balloting for strikes, adding pressure to UK’s transport network, which has been hit by a wave of industrial action.

More than 3,000 members of UK’s Unite Union will start voting on February 17, with the ballot closing on March 17. These workers had rejected a 10% pay increase, the union said in an emailed statement on Sunday.

February 27: ‘Grim Reality’ Airlines Are Facing over Pilot Shortage – Air Cargo Week

The chairman of the board of Avia Solutions Group Gediminas Ziemelis has predicted a shortage of 300,000 pilots within a decade, which he describes as a “grim reality airlines are facing.”

Pilots work through a seniority-based system. This means that these aviation professionals progress through ranks and open positions as they advance in their careers. For many airlines, the recruitment process requires qualified pilots to bid for open positions, after which they receive intensive training to match the skill requirements for a specific position, notes Ziemelis.

On the other hand, the retirement system may create a ripple effect, exposing airlines to unexpected crew shortages, mainly due to unmatched levels of newly hired and adequately trained pilots and those going into retirement.

 

 

Rail

February 3: Canadian Rail Shippers Praise Feds’ Actions to Collect More Freight Data – FreightWaves

While the Canadian government has made inroads regarding the collection of additional freight rail data metrics and the preservation of interswitching, Transport Canada could go a few steps further in regulating better service in Canada, say rail shippers.

Transport Canada in January said the Canadian government approved amendments to the transportation information regulations that would require major railways to supply additional freight rail data, including waybill information – such as origin, destination and weight – and traffic data – such as the number of carloads, goods and car types.

This data will be published weekly on the Canadian government’s Transportation and Information Hub “to provide Canadians with a better picture of end-to-end freight rail performance,” according to a January 9 news release. The modifications become effective April 4 and include data pertaining to certain first-mile and last-mile metrics. Plus, the railways must report the number of operating employees available to move traffic.

February 16: Report: Canada’s Rail Rates Among the World’s Lowest – Progressive Railroading

A consultant’s report requested by the Railway Association of Canada (RAC) shows that Canada’s freight-rail rates are the lowest of major market-based economies the firm surveyed, including in the United States.

The report by CPCS concluded that Canada’s average freight-rail rate is 11% lower than that of the United States, according to a press release from RAC.

Using publicly available data, the study surveyed 11 countries representing two-thirds of global gross domestic product. All of the countries are home to high-performing rail systems.

February 20: Unifor Taking Strike Votes at CN – Inside Logistics

Unifor’s CN workers will be taking strike votes this week.

Unifor’s two national bargaining committees continued contract negotiations with CN the week of February 13-17 in Montreal. This was the fifth bargaining session with the company since bargaining opened on October 19, 2022.

Unifor’s national collective agreements with CN that cover the working conditions of more than 4,000 workers expired on December 31. Two bargaining committees are involved, Council 4000 and Local 100. Local 100 represents locomotive and freight-car mechanics, electricians and apprentices. Council 4000 represents over 3,000 employees, including workers at CN, Intermodal, CNTL and CN Savage Alberta Railway.

February 22: Illinois’ Federal Lawmakers Urge STB to Put Off CP-KCS Merger Decision – Progressive Railroading

Federal lawmakers from Illinois have asked the Surface Transportation Board to defer its decision on the proposed merger between Canadian Pacific and Kansas City Southern until the board conducts a “more thorough and accurate study” of its potential impact on the Chicago area.

In a February 17 letter, U.S. Senators Dick Durbin and Tammy Duckworth, and U.S. Representatives Raja Krishnamoorthi and Delia Ramirez (all Democrats) wrote that the STB’s recently released environmental impact statement (EIS) on the proposed merger relied only on data provided by CP and ignored more comprehensive modeling provided by Chicago commuter railroad Metra, whose tracks CP trains operate on.

 

 

Trucking

February 3: Provinces Differ in ELD Enforcement Penalties – Today’s Trucking

More than a month into the enforcement of the federal electronic logging device (ELD) mandate, individual provinces are taking different approaches when it comes to penalties.

February 9: Government of Canada Invests in Trucking HR Canada’s Career ExpressWay Program – THRC press release

Trucking HR Canada (THRC) has introduced an addition to its Career ExpressWay Program. Thanks to funding from the Government of Canada, the trucking industry will look to recruit and onboard up to 2,600 new workers in both driving and non-driving roles.

This new injection of funding will provide up to $10,000 to cover the cost of entry-level driver training for those looking to enter the occupation, along with a wage incentive of the same amount to support employers with onboarding, mentoring and finishing training. Wage incentives are also available for new hires in other in-demand positions.

February 10: CTOA Defends Driver Inc. Model – Today’s Trucking

You’d be hard pressed to find a more divisive issue in the Canadian trucking industry than the so-called Driver Inc. employment model for truck drivers.

Driver Inc. – a definition coined by those who oppose the practice of classifying drivers of company-owned equipment as independent contractors – has been widely adopted in the trucking industry. Carriers that stand by the traditional employee/employer classification feel the Driver Inc. model is used to reduce costs and undercut rates by sidestepping employer source deductions and depriving drivers of certain rights under employment law.

The Canadian Trucking Alliance (CTA) and its provincial partner associations have aggressively called on federal and provincial governments to crack down on the practice and have complained that enforcement has been woefully inadequate.

But tell that to the member fleets of the newly formed Canadian Truck Operators Association (CTOA), which largely comprises the growing number of fleets who prefer the model. They say they’ve been unfairly targeted by federal and provincial agencies that have in some cases laid fines against them for misclassifying drivers. And they have a lawyer who supports their position and is willing to go to bat for them where drivers in fact have an independent contractor relationship with the company for which they drive.

February 13: B.C. Provincial Carriers Required to Use ELDs Beginning August 1 – Today’s Trucking

Provincially regulated commercial vehicle operators in British Columbia will be required to use electronic logging devices (ELDs) beginning August 1.

Failure to equip a vehicle with a compliant ELD will lead to a $520 fine, according to a new National Safety Code bulletin issued February 13 by the B.C. Ministry of Transportation and Infrastructure.

February 24: Vancouver Fraser Port Authority Postponing Truck Replacement Program for Third Time – CBC News

The Vancouver Fraser Port Authority is suspending a controversial program to replace older trucks servicing the port for at least another nine months while it reassesses its plans.

It is the third time the port is postponing the Rolling Truck Program, which was supposed to begin April 3 to phase out trucks more than 12 years old to improve air quality and community health.

Truckers who use the port say the onus is on owners and operators to replace the older vehicles at a steep cost, even though many of them already meet emissions standards.

The port authority says the decision comes because of the state of the economy and ongoing issues related to the pandemic, but it plans to explore new technologies and will reassess its emissions-reduction strategy.

February 26: NACFE Offers Guidance for Navigating the ‘Messy Middle’ – Today’s Trucking

The North American Council for Freight Efficiency (NACFE) has dubbed the current part of the trucking industry’s journey toward decarbonization as the “messy middle,” but it doesn’t want that to be viewed negatively.

“It shouldn’t have a negative connotation,” said Jeff Seger, author of NACFE’s latest report on the messy middle. “It’s just a period of a lot of different options for fleets, and a lot of decisions are going to need to be made.”

Decarbonization is already in progress, added NACFE head Mike Roeth. This is even true for fleets that are still burning diesel, as they slash emissions through things like improved aerodynamics, low rolling resistance tires, idle reduction, and other diesel-compatible options that are currently available.

The ‘messy middle’ is a time for fleets to take action, Roeth added. But he also cautioned fleets to only adopt the technologies that make sense in their applications. “Do not push a hamburger on a vegetarian,” he said, noting fleets should adopt technologies that make sense for them today.

 

 

CIFFA Advocacy, Communications, Activities

February 9: CIFFA Selects 2023 Canadian Young Logistics Professionals Award Winner – CIFFA press release

Every year, CIFFA offers an award to a young freight forwarder who best demonstrates industry knowledge and skills to become a true international freight forwarding professional in the future.

After a review process of industry experience and a written dissertation demonstrating technical knowledge, CIFFA is pleased to announce that Viktoriia Rudyk of DSV Air & Sea Inc. has been selected as the 2023 Canadian Young Logistics Professionals Award winner.

Originally from Ukraine, Viktoriia came to Canada to study the 2-year International Business Management diploma program at the British Columbia Institute of Technology (BCIT) in Vancouver.  In addition, she has taken the CITT and CIFFA courses, has been actively volunteering, participating at different networking events, and has worked on projects as a student consultant at Delta Chamber of Commerce and the World Trade Centre Vancouver.  After finishing her studies at BCIT, Viktoriia joined the trainee program at the Toronto branch of DSV Air & Sea Inc. At DSV she has worked as an Air Import Coordinator, an Air Export Coordinator, and currently works as an Ocean Import Team Lead in Montreal. She is a big fan of the continuous learning concept and likes the constant challenge that the freight forwarding profession offers.

Maritime

MSC Online Invoice Dispute Tool

If you receive an invoice from MSC Canada that you believe requires a change before you make a payment, you can request a change to one or multiple invoices at the same time through MSC’s online invoice dispute tool.

December 29: Egypt’s Currency Crisis is Creating a Massive Port Backlog – The Maritime Executive

A major hard-currency crisis in Egypt is causing a massive backlog across the country’s ports, where goods worth $9.5 billion are stuck – even as the government engages in desperate measures to facilitate their release and avoid a spike in the prices of essential commodities.

With Egypt sinking deeper into a prolonged economic crisis, exacerbated by the Russian invasion of Ukraine, the country’s ports have recently been clogging up with goods due to a dollar shortage, a crisis that has been worsened by a substantial nosedive of the Egyptian pound. The currency has depreciated by about 36 percent since the beginning of the year.

Over the period from December 1 to 23, the government – which has imposed restrictions on imports to save foreign currency – managed to release goods worth $5 billion. Other cargoes worth $9.5 billion are still being held at the country’s ports awaiting the securing of dollars required to release them. Priority is being given to food products, food-manufacturing components, medicines and production goods.

December 29: Chance that Container Ship Arrives on Time is Still a Coin Toss – FreightWaves

A year ago, fear was a big driver of the supply chain crunch: fear that goods wouldn’t arrive on time, stoked by headlines warning that shipping delays could “cancel Christmas.” It became a vicious cycle. The threat of delays caused importers to max out orders and bring them forward, causing more delays.

Importers ordered too much in late 2021, and to avoid another holiday scramble, they shipped in seasonal goods early in 2022. This front-loading alleviated pressure on the supply chain in the second half of the year.

Container shipping schedules have become more reliable in light of lower volumes, so importers have less to fear from ocean shipping delays. But despite progress, the supply chain is still not back to where it was pre-COVID.

Sea-Intelligence’s “Global Liner Performance” report found that 56.6% of services arrived on time in November – the highest reliability percentage since August 2020. It’s a big improvement from January last year, when reliability cratered at just 30.4%. Yet the on-time rate is still just above a coin toss and remains well below the 2018-2019 average of 74%.

January 3: Maersk Joins Rivals in Softening Contract Conditions for Shippers – The Loadstar

Ocean carriers are tempting BCOs with a wide range of new, flexible, long-term contract options this year, after shippers complained of being “burned” by committing to rigid, highly elevated contracts a year ago.

Last year, shippers were presented with ‘take it or leave it’ fixed-rate long-term contract options by carriers against a backdrop of very strong demand and an acute shortage of equipment and vessel capacity.

But as consumer demand slumped in Europe and the U.S., and supply chain congestion eased around the world, the second half of 2022 saw container spot rates collapse to levels well below contract rates, leaving signed-up shippers at a significant disadvantage to competitors using the spot market.

It appears that now even Maersk, one of the architects of the inflexible multi-year contracts rolled out to selected blue-chip shippers a year ago, has recognized the need for more adaptability in long-term contract terms and conditions.

January 6: Coast Is (Almost) Clear as Port Congestion Fades Even Further – FreightWaves

What a difference a year makes. At this time in 2022, over 100 container ships were stuck waiting off the ports of Los Angeles and Long Beach, California, with around 150 off all North American ports combined. Now, there are almost no ships waiting in Pacific waters and increasingly few off the East and Gulf coasts.

Ship-position data showed just 30 container vessels off North American ports on January 6. All remaining queues are down to single digits per port.

And factory closures for Asia’s Lunar New Year holiday are expected to depress U.S imports in the first quarter, giving ports a chance to clear out the last of the queues.

January 16: Hapag-CMA Deal Sees Re-emergence of Cross-Alliance Slot Chartering – The Loadstar

As their network coverage becomes compromised by an aggressive blank-sailings strategy, ocean carriers are turning to slot charter deals with members of rival ocean alliances to cover their contract commitments.

Effective next month, Hapag-Lloyd has agreed to a slot charter with Ocean Alliance member CMA CGM that it said would strengthen its coverage in Asia and provide dedicated connections for the North Europe Benelux ports and the UK’s Southampton.

The slot charter is outside Hapag-Lloyd’s THE Alliance membership and won’t involve any other partners in the vessel-sharing agreement.

Vespucci Maritime CEO Lars Jensen said there could be more cross-alliance agreements to come. “The dramatic decline in demand, especially on Asia-to-North Europe and Asia-to-U.S. routes, has forced the carriers to be busy cancelling sailings to attempt to avoid too much overcapacity,” he said. “This leads to a reduction in their service coverage, and an obvious solution for a carrier is precisely what we are seeing here.”

January 17: DP World Eyes Second Container Terminal at Port of Prince Rupert – Splash

DP World Prince Rupert has engaged AECOM, an infrastructure consulting firm, to conduct a feasibility and design study for the development of a second container terminal at the Port of Prince Rupert on Canada’s Pacific Coast. AECOM’s work is intended to determine the technical and financial feasibility of developing the terminal, and provide the baseline studies that will be required for environmental approvals.

The second terminal, which will be fully electric, is anticipated to double the Port of Prince Rupert’s overall container capacity, adding at least 2 million twenty-foot equivalent units annually.

January 17: Saskatchewan and Manitoba Seeking to Limit Fees on Exports Going Through Port of Vancouver – 650 CKOM

Saskatchewan and Manitoba are heading to court to get involved in a case based in B.C.

In a media release, the Saskatchewan government said it was joining Manitoba in seeking leave in federal court to intervene in a judicial review of the Vancouver Fraser Port Authority’s new gateway infrastructure fees.

“As a province that depends heavily on exports, Saskatchewan wants to ensure that the full impact of new port fees on key sectors of our economy is taken into consideration,” Bronwyn Eyre, Saskatchewan’s justice minister and attorney general, said in the release.

“These fees could significantly increase costs for Saskatchewan goods moving through the Port of Vancouver and diminish Canada’s overall global competitiveness.”

The Vancouver Fraser Port Authority’s new fees took effect January 1. The government said the fees range from eight to 40 cents per tonne for bulk, non-containerized cargo such as potash and grain – two of Saskatchewan’s biggest exports.

January 19: Non-Alliance Carriers are Losing Market Share After Years of Growth – The Maritime Executive

After enjoying strong growth during the shipping surge experienced over the past two years, non-alliance carriers are losing market share. With the current levels of overcapacity rising across most segments of the container shipping industry and possibly getting worse as more new tonnage enters the market, Sea-Intelligence is predicting that the market share for the independent carriers will continue to decline.

“As the market strengthened after the initial COVID hit, there was a confluence of small carriers that started to deploy capacity, especially on the transpacific trade,” said Alan Murphy, CEO of Sea-Intelligence. He notes major carriers also started to introduce services outside the alliance networks. “The idea was to take advantage of the opportunity provided by the very high freight rate environment.”

Taiwan-based carrier Wan Hai for example in 2020 launched an independent transpacific route after its alliance with Pacific International Lines and COSCO ended. In addition, new specialized carriers emerged, seeking to offer niche services and appealing to shippers that found it difficult to place smaller cargoes with the big carriers.

January 20: Bleak Outlook Post-Chinese New Year Prompts More Blank Voyages – The Loadstar

As China begins its lunar new year celebrations this weekend, ocean carriers are desperately seeking visibility of export cargo demand for the first weeks and months of the Year of the Rabbit.

And with the short-term outlook looking bleaker by the day, 2M partners MSC and Maersk have blanked a further six transpacific headhaul voyages – following those they announced on January 12 – through to February 12.

January 20: Updates to Memorandum D3-5-1 – Marine Pre-load/Pre-arrival and Reporting Requirements

This memorandum outlines and explains specific Canada Border Services Agency’s (CBSA) procedures for the advance notification, reporting, use and control of vessels in international commercial services.

In brief, this memorandum has been revised to:

  1. Reflect updates and additions to the Definitions section.
  2. Update information on liability, conveyance arrival certification message (CACM), exemptions from cargo data – only conveyance data required, in-transit shipments, consortium and co-load agreement (carrier codes), overages, shortages, Canadian military vessels, ferries, delivery requirements and transfers to sufferance warehouses, international waste, and wood packing material.
  3. Remove information on transmitting accurate data, found astray (misrouted goods), non-resident importer, transmitting ‘to order’ shipments, moving company, personal effects, ETA – entered to arrive and value included shipments, and overland movement.
  1. Add information on sub-location codes, A6 reporting requirements for vessel at anchor, Canadian goods returned, non-emergency repairs, foreign government vessels, unique shipment processes and Canada-European Union Comprehensive Economic and Trade Agreement (CETA).

Find details in Memorandum D3-5-1.

January 24: Roberts Bank Terminal 2 Information Request Response Declared Sufficient – VFPA press release

Canada’s Minister of Environment and Climate Change Steven Guilbeault has informed the Vancouver Fraser Port Authority that information the VFPA provided related to the Roberts Bank Terminal 2 Project is sufficient.

With this determination, the minister said “the federal timeline for the issuance of a decision statement for the Roberts Bank Terminal 2 Project will resume as of today [January 23].”

January 25: Maersk, MSC Terminating 2M in 2025 – FreightWaves

The global container shipping network is poised for a major shake-up. The 2M vessel-sharing alliance between MSC and Maersk is being dissolved.

The two carriers announced that they have mutually agreed to terminate the alliance effective January 2025. Under the agreement signed in 2015, the alliance on east-west services was for a minimum of 10 years with a two-year notice period for termination.

“Discontinuing the 2M alliance paves the way for both companies to continue to pursue their individual strategies,” said MSC CEO Soren Toft and newly appointed A.P. Moller-Maersk CEO Vincent Clerc in a joint statement.

The decision to terminate the 2M alliance has no effect on immediate alliance services, they emphasized. “We look forward to a continued strong collaboration throughout the remainder of the agreement period,” said Toft and Clerc.

January 25: FMC Reports Increase in D&D Claims as Carrier Rulemaking Proceeds – The Maritime Executive

The U.S. Federal Maritime Commission is reporting that it has received a strong response to the proposed rulemaking for key parts of the Ocean Shipping Reform Act of 2022 focusing on fees and the business practices of the leading carriers. The FMC is extending its process to solicit additional input while it also reported a strong increase in the complaints received in the second half of 2022.

In less than seven months since the act became law, the FMC staff estimates that more than $700,000 in charges have been refunded by carriers due to complaints filed over demurrage and detention billings. Fees were one of the issues driving the reform act. During the January meeting of the FMC conducted on January 25, the staff reported it has received more than 200 filings since the law’s enactment in June 2022. More than 70 charge complaints met the threshold requirements for being referred to investigators.

The FMC reports that the act is already having a positive impact on the market while the commission is continuing two of the key rulemaking elements called for under the act. The FMC staff reports a strong response with a large number of comments received both on its draft rules on D&D billing and defining the “Unreasonable Refusal to Deal or Negotiate” for vessel space and more specifically exports. Both of the issues were central to the reform act.

January 27: Maersk Plans Unified Identity, Ending Hamburg Sud and Sealand Names – The Maritime Executive

Maersk announced its intentions to move to a single brand identity as it works to integrate recent acquisitions and its multiple brands as the corporation continues the move toward its vision of a global logistics provider. In its aim to unify its brands and structure, storied brand names including Hamburg Sud and Sealand, as well as Twill, a freight logistics service for small and medium-sized businesses launched by Maersk, and newly acquired brands like Senator and LF Logistics will be phased out.

“We realize that our current brand structure doesn’t reflect the way you, our customer, have your supply chain structure and the need you have for end-to-end visibility and ability to drive outcomes,” Maersk wrote in a customer advisory on the intent to integrate its brands. It noted that an in-depth review will be conducted to conclude the future of each brand in different geographies and that the timeline would be determined individually for each brand.

 

 

Air

January 9: Global Demand for Air Cargo Tailing Off: IATA – FlightGlobal

Global demand for air cargo softened in November 2022, the most recent month of data, as carriers continued facing economic headwinds and the pandemic-related cargo boom lost steam.

As measured in cargo tonne-kilometres (CTKs), global air freight demand fell 13.7% last November compared with November 2021, according to a January 9 report from the International Air Transport Association (IATA).

“Air cargo performance softened in November, the traditional peak season,” says Willie Walsh, IATA’s director general. “Resilience in the face of economic uncertainties is demonstrated with demand being relatively stable on a month-to-month basis. But market signals are mixed.”

January 4: Air Cargo Faces Mixed 2023 in a ‘Cooling’ Market – AIN Online

The CEOs of several major air cargo operators in recent weeks conveyed an optimistic outlook for 2023, yet they also acknowledged that the year will not likely yield the bumper performance the sector realized in 2021 and 2022.

Global air cargo volumes, yields, load factor and revenues will all decline in 2023, according to the International Air Transport Association (IATA)’s latest forecast released in December. The group expects air cargo volumes measured by cargo tonne kilometers (CTKs) to fall by 4 percent year-over-year in 2023, following an 8 percent year-over-year drop in 2022. “The softer outlook for the global macroeconomy, along with international trade, is presenting headwinds to air cargo,” noted Andrew Matters, IATA’s head of policy analysis. “Things that are exerting a bit of a drag in terms of cargo volumes include the conflict between Russia and Ukraine, global [economic] growth slowdown, higher inflation, higher interest rates, and the higher cost of living,” he said.

The International Monetary Fund (IMF) projects that global growth will slow to 2.7 percent this year, from 3.2 percent in 2022 and 6 percent in 2021, and its managing director Kristalina Georgieva warned that a third of the global economy will enter recession this year. The World Trade Organization forecasts that trade will slow sharply in 2023 to just 1 percent as a result of the various headwinds in the global economy.

Cargo yields likely will take a “significant step back” this year, said Matters. IATA expects a year-on-year fall of 22.6 percent. “[It] sounds like a very big number; it sounds pretty dramatic,” he commented, calling expectations of a pull-back in yields, however, “not unreasonable” in the context of the very strong increases of recent years. Cargo yields grew by 52.5 percent in 2020, 24.2 percent in 2021, and 7.2 percent in 2022. “These levels are not sustainable,” Matters remarked. “Even the sizable and expected decline leaves cargo yields well-above pre-COVID levels.”

 

 

Rail

January 3: Union Representing CN Rail Traffic Controllers Ratifies New Agreement – CN press release

On December 23, the Teamsters Canada Rail Conference ratified a new collective agreement. The agreement covers approximately 160 rail traffic controllers in Canada.

The agreement came into effect on January 1 and includes adjustments to wages of 3% in 2023, 3% in 2024 and 2.5% in 2025 and other benefits. The agreement is in effect until December 31, 2025.

January 9: Minister of Transport Announces Requirement to Provide More Freight Rail Data – Transport Canada press release

Minister of Transport Omar Alghabra on January 8 announced amendments to the Transportation Information Regulations to increase supply chain transparency and create a better understanding of the performance of Canada’s freight rail sector for the benefit of all rail users.

These amendments aim to strengthen the accountability of freight rail service providers, by requiring major railways to provide Transport Canada with enhanced service and performance information. This information will significantly enhance the value of the information being collected and it will be published weekly on the Government of Canada’s Transportation Data and Information Hub to provide Canadians with a better picture of end-to-end freight rail performance.

Major railways will also provide Transport Canada with additional data to support targeted public policy and other regulatory purposes, including waybill information (such as origin, destination, weight) and traffic data (such as number of carloads, goods, and car types).

These changes will come into force on April 4, 2023. They are an important part of the Government of Canada’s response to the issues raised in the National Supply Chain Task Force’s Final Report.

January 13: CP and Unifor Reach Tentative Collective Agreement – CP press release

Canadian Pacific Railway Limited has reached a tentative collective agreement with Unifor on a new contract for mechanical employees in Canada.

Unifor represents approximately 1,200 of CP’s mechanical employees, who are responsible for maintaining rail cars and locomotives. The previous collective agreement expired on December 31, 2022.

January 30: U.S. STB Issues Final Environmental Review of Proposed CP-KCS Merger – Progressive Railroading

The U.S. Surface Transportation Board on January 27 issued a final environmental impact statement (EIS), accessible here, for the proposed merger between Canadian Pacific and Kansas City Southern.

Issuance of the final EIS completes the STB’s environmental review of the proposed merger. The board will consider the transportation merits of CP’s acquisition of KCS, and the entire environmental record, including the draft EIS, final EIS and all comments received, as part of its final decision in the proceeding, STB officials said in a press release.

 

 

Trucking

January 4: FMCSA Proposes Tougher Rules for Truck Broker Financial Backing – FreightWaves

The U.S. Federal Motor Carrier Safety Administration is proposing more oversight of truck brokers and freight forwarders and the surety bond and trust companies that back them up in an effort to ease the monetary pain they can inflict on motor carriers.

“FMCSA believes that most brokers operate with integrity and uphold the contracts made with motor carriers and shippers,” the proposal states. “However, a minority of brokers with unscrupulous business practices can create unnecessary financial hardship for unsuspecting motor carriers.”

The Owner-Operator Independent Drivers Association has complained to FMCSA of those hardships. In comments filed in 2018 to an advanced rulemaking proposal on the issue, the group pointed out that a legislative statute known as MAP-21, signed into law in 2012, increased the amount of the broker bond to a minimum $75,000, “but raising the bond to this amount did not stop brokers from continuing to steal transportation services in excess of the bond amount,” OOIDA stated.

“It is critical that FMCSA’s final rule implements the imperatives and timeliness provided in the statute to act quickly by suspending a broker’s authority before the broker’s nonpayment to motor carriers results in claims on its bond or trust in an aggregate amount of more than $75,000.”

January 6: Provinces Differ in Approaches to ELD Penalties – Today’s Trucking

Canada’s federally regulated carriers now face a mandate to equip trucks with certified electronic logging devices (ELDs), but individual provinces are taking different approaches when it comes to penalties and deciding whether to apply the rules to provincially regulated carriers.

Quebec remains the sole province yet to begin enforcing the federal rules that apply to trucks that cross provincial borders or the international border, although any Quebec carrier would see the rules enforced as soon as they cross into Ontario or New Brunswick.

All remaining provinces, with the exception of B.C. and New Brunswick, will issue fines to those who fail to comply with the rules, while those other than B.C. and Newfoundland will apply points to carrier records. Provinces other than Quebec, New Brunswick and Nova Scotia are also threatening to shut down carriers in cases of “gross non-compliance.”

January 9: MGT Gates to Open Earlier, Operate 18 Hours a Day

The overhaul of the Lafontaine Tunnel in Montreal is expected to take three years. As of October 31, the capacity of the six-lane tunnel has been reduced by half, leaving just one lane heading south and two heading north. Despite numerous mitigation efforts, the reduction in capacity has created challenges for South Shore commuters and for freight transportation providers.

Effective January 9, MGT truck gates will open an hour earlier, at 5:00 am instead of 6:00 am, Monday to Friday, to help minimize the morning peak commuting period. MGT gates will now operate 18 hours a day on weekdays, until 11:00 pm.

MGT will absorb the additional costs associated with this extra hour of service from January 9 through February 10, inclusively. However, given the high inflationary environment, plus the significant costs associated with the added operating hour, note that, effective February 13, the Gate Service Fee will be adjusted to $50.00 per laden container, in or out, while empty containers will continue to be received and delivered without any service fee.

January 17: U.S. Carriers Continue to Fold as Pandemic Freight Boom Recedes – FleetOwner

As freight truck utilization continues to fall from pandemic-era capacity, more small carriers are giving up for-hire authority as equipment and other carrier costs remain higher at the start of 2023. This could be a slow, messy year for freight.

The U.S. trucking industry lost more carriers in December than any month since Hurricane Katrina disrupted much of the over-the-road freight industry, according to data from FTR Transportation Intelligence.

The booming freight market born out of the pandemic that began nearly three years ago created a market for new for-hire carriers within a thriving spot market. During most of 2020 and 2021, hundreds to thousands of companies established for-hire authority each month. While there were fits and starts through much of 2022, Avery Vise, FTR’s VP of trucking, said the industry started losing “a pretty substantial number” of carriers in October.

“Preliminary data for December would indicate that we have lost more carriers in December than we lost in any month on record – with the exception of December ’05, which was in the wake of Hurricane Katrina and all the disruptions that led to,” Vise said. “This is likely to continue for a period of time.”

January 22: New Trucking Group Vows to ‘Disrupt the Status Quo,’ Demands Seat at Decision Making Table – Today’s Trucking

A newly formed trucking organization has been created over the last two months, and on January 21 brought together at its inaugural gala more than 1,000 people representing about 200 carriers.

The Canada Truck Operators Association (CTOA), comprised largely of trucking companies run by people with South Asian backgrounds, promised inclusivity as it demands a seat at the tables where policy and legislation affecting its members are created.

The segment of the trucking industry that comprises the CTOA has largely been missing from discussions regarding the policy and regulations affecting it, said Executive Director Jaskaran Sandhu. A Newcom Media analysis in 2018 found that 17.8% of Canadian truck drivers identified as South Asian, up from 1.8% in 1996. That number was higher in Ontario (25.6%) and B.C. (34.6%).

 

 

CIFFA Advocacy, Communications, Activities

January 4: CIFFA Signs eFBL Agreement with FIATA

CIFFA recently signed a distribution agreement with FIATA, enabling our members to distribute paperless FIATA bills of lading.

Benefits to this new agreement:

For more information, visit the website FIATA eFBL.

Maritime

December 2: Container Shipping Rates Still Sinking: Skid Slows for Asia Spot Rates to West Coast but Not to East Coast – FreightWaves

“This cliff that rates have fallen from shows there is more competition in the market than a lot of people had feared,” said Patrik Berglund, CEO of rate-tracking company Xeneta, in a recent interview.

The pace of spot-rate declines did slow in some trade lanes in October versus August and September. However, rate losses picked up again in many lanes in November, causing global averages to fall further. There’s no sign yet of a market bottom in most trades.

December 7: Liners Turning into ‘Tramp Operators’ as They Blank More Sailings – The Loadstar

Ocean carriers are ramping up their efforts to halt the relentless erosion of container spot rates by blanking more sailings from Asia, but shippers claim they are becoming like tramp operators in the process.

But there is some evidence that export space is now tightening: reports to The Loadstar recently have indicated that some carriers are putting out full signals for ships sailing before the Chinese New Year holiday next month.

December 7: Carrier Schedule Reliability Returns to 2020 Levels as Backlogs Recede – The Maritime Executive

While much of the attention has been on how declines in container volumes have caused freight rates to plummet in 2022, it is also having a positive effect on the schedule reliability of the major carriers.

In its latest monthly update, market research and data analytics firm Sea-Intelligence highlights that the container carriers’ schedule reliability during October had its strongest monthly improvement, which is also being seen by the declining backlog of vessels at major container ports.

Sea-Intelligence CEO Alan Murphy reports that both schedule reliability and the average delay for vessels have returned to levels more consistent with 2020 than the levels seen over the past two years. Analyzing the performance across 34 different trade lanes and more than 60 carriers during October, Sea-Intelligence shows that schedule reliability surpassed 50 percent for the first time in two years, while the average delay calculated in the number of days is at its lowest point since November 2020.

December 9: Spot and Long-Term Container Rate Gulf Continues to Widen – Seatrade Maritime News

As container spot rates continue to plunge, the gulf with long-term contract levels gets ever wider.

The Asia–Europe trade continued to lead the downwards trajectory, with Drewry reporting that Shanghai to Rotterdam spot rates lost another 14% last week to sit at just $1,686 per FEU.

Drewry’s World Container Index (WCI) dropped a further 6% to sit at $2,139 per FEU and is now 79% below the peak of $10,377 reached in September 2021.

December 13: CMA CGM Restricts Bookings to South China Through January – The Loadstar

French liner CMA CGM has told customers it will restrict bookings for shipments due to arrive at ports in southern China in early 2023, due to a suspension of service by feeder and barge operators through January.

South China and Hong Kong feeder operators have announced temporary service suspensions throughout next month, “due to COVID-19 quarantine requirements for ship crews” prior to Chinese New Year, CMA CGM (India) noted in an advisory.

It said the restriction would apply to cargo bound for some 30 destinations, including three in Fujian province, on sailings calling at Hong Kong, Yantian, Nansha and Shekou, in January.

According to the Marseille-based company, normal services are expected to resume in early February, subject to further updates from feeder operators.

December 15: U.S. FMC Probing Shipping Lines’ Anti-Retaliation Compliance – American Journal of Transportation

The Federal Maritime Commission is asking the top 20 shipping lines calling the United States to provide information on how they are complying with the new prohibitions on retaliation established by the Ocean Shipping Reform Act of 2022 (OSRA).

The added protections against retaliation were created by Section 5 of OSRA and became effective immediately upon the law’s enactment in June. The prohibitions apply to common carriers, marine terminal operators and ocean transportation intermediaries.

The Commission’s Vessel-Operating Common Carrier (VOCC) Audit Team is examining how ocean carriers are adapting to the increased prohibitions on retaliatory and discriminatory behaviour. The team will specifically focus on how companies are training personnel at all levels to act legally, and how those same employees are being made aware of the consequences for violating the law.

December 16: Ocean Carriers to Increase Blank Sailings from Asia Post-Chinese New Year – gCaptain

Against a background of extremely weak demand forecasts, ocean carriers are preparing to blank around half their advertised sailings from Asia to North Europe and the U.S. after Chinese New Year on January 22.

High inventory levels in Europe and the U.S., coupled with uncertainty surrounding future consumer demand, has seen orders cancelled or postponed, resulting in Chinese factories preparing to shut down well ahead of the CNY holiday.

December 21: New Shipping Regulation to Combat Global Warming is Under Fire – FreightWaves

The ocean shipping industry is just days away from the debut of the Carbon Intensity Indicator (CII), a new regulation meant to combat global warming. Even as an initial baby step, the CII is not inspiring confidence in the future decarbonization of shipping.

The new regulation seeks to lower carbon emissions by having container ships, tankers, bulkers, car carriers and other vessels operate more efficiently. It is a product of the United Nations’ International Maritime Organization (IMO) that has been in the works for years and debated ad nauseam within shipping circles.

Those outside of shipping who rely on the world’s vessels to transport their goods may scratch their heads when they learn of the strange brew the IMO has concocted. CII’s complexities, unintended consequences and weak enforcement call to mind the phrase “too many cooks in the kitchen.”

And implementation, set to begin January 1, just got even more complicated.

 

 

Air

December 5: China’s Air Cargo Supply Chain Faces More Pressure – Air Cargo News

Freight forwarders are reporting a mixed picture of the current supply chain situation in China as COVID lockdowns continue following recent protests against the government’s pandemic policy.

China’s pandemic measures are continuing to have a negative impact, although market rates remain similar to the previous week, according to Flexport.

“The COVID outbreak in the Guangzhou area continues to affect manufacturing operations, resulting in cargo output delays,” said Flexport in its airfreight market update on November 29.

Additionally, low demand out of North China is set to continue and this has had a direct impact on flights.

Westbound Logistics pointed out in a recent customer update that Chinese New Year is also approaching,  with a two-week shutdown starting January 22. The shutdown could further exacerbate supply chain weakness.

December 7: 2022 SAF Production Increases 200% – More Production Incentives Needed to Reach Net Zero – IATA press release

The International Air Transport Association (IATA) estimates that sustainable aviation fuel (SAF) production will reach at least 300 million litres in 2022 – a 200% increase on 2021 production of 100 million litres. More-optimistic calculations estimate total production in 2022 could reach 450 million litres. Both scenarios position the SAF industry on the verge of an exponential capacity and production ramp-up toward an identified tipping point of 30 billion litres by 2030, with the right supporting policies.

December 8: Forwarders Stick with Short-Term Deals as Air Cargo Volumes Fall – Air Cargo News

Freight forwarders are continuing to opt for short-term airfreight deals as volumes and rates continue to decline.

The latest statistics from CLIVE Data Services show that, in November, air cargo volumes declined 8% year on year and were down 2% on October, while the dynamic load factor – based on weight and space – was down five percentage points on last year, at 61%.

It is the ninth month in a row that demand has fallen.

Average rates for the month were down 27% on a year ago, but remained 85% ahead of 2019 levels.

December 13: Air Freight Rates Nosedive, with Shippers Flocking to Ocean – Supply Chain Dive

Air cargo rates dropped for the third consecutive month in November as demand slows and shippers flock to an improved ocean landscape, according to a December 7 update from Xeneta’s Clive Data Services.

In November, rates on the China-North America trade lane fell more than 40% YoY, Freightos reported last week. Spot rates on the general TransPacific lane were down 32% YoY, though still higher than pre-pandemic levels, according to Clive.

Despite hopes for a late peak season boost, demand fell 2% in November compared with October, with volumes declining for the ninth consecutive month, according to Clive.

 

 

Rail

December 1: U.S. Senate Passes Bill to Avoid Rail Strike – Transport Topics

The U.S. Senate moved quickly on November 30 to avert a rail strike that the Biden administration and business leaders warned would have had devastating consequences for the nation’s economy.

The Senate passed a bill to bind rail companies and workers to a proposed settlement that was reached between the rail companies and union leaders in September. That settlement had been rejected by some of the 12 unions involved, creating the possibility of a strike beginning December 9.

The Senate vote came one day after the House voted to impose the agreement. The measure now goes to President Joe Biden’s desk for his signature.

“I’m very glad that the two sides got together to avoid a shutdown, which would have been devastating for the American people, to the American economy and so many workers across the country,” Senate Majority Leader Chuck Schumer (D-N.Y.) told reporters.

Schumer spoke as Labor Secretary Marty Walsh and Transportation Secretary Pete Buttigieg emphasized to Democratic senators that rail companies would begin shutting down operations well before a potential strike would begin. The administration wanted the bill on Biden’s desk by the weekend of December 3/4.

December 20: U.S. Rail Regulators Streamline Process for Shippers to Challenge Unreasonable Rates – Supply Chain Dive

U.S. federal regulators have finalized the process for determining unreasonable freight rail rates, giving shippers with smaller disputes a more streamlined pathway to challenge carriers.

The Surface Transportation Board adopted two rules establishing a voluntary arbitration program in addition to a new procedure to challenge rates. The reviews are meant for disputes worth up to $4 million in relief over two years, a statement said.

By adopting two separate pathways, regulators are hoping to incentivize rail carriers to resolve disputes through mediation rather than intervention. If all seven Class I carriers agree to opt into the voluntary arbitration program, they will become exempt from the Final Offer Rate Review process.

 

 

Trucking

December 13: NRCan Funding Available for Fuel-Saving Equipment – Today’s Trucking

Natural Resources Canada (NRCan) is now accepting applicants for funding available to the trucking industry to improve fuel economy and reduce greenhouse gases (GHG).

Stream 1 of the Green Freight Program has been recapitalized and applications are now being accepted.

Fleets can apply for grants covering up to 50% of the costs of third-party fleet energy assessments and truck equipment retrofits through the program. Devices that are covered include side skirts, boat tails, cab heaters, auxiliary power units, low rolling resistance tires and tire pressure monitoring systems, among others.

Nearly $35 million will be awarded through the program in 2023/24.

December 14: Canadian Businesses Face Challenges in Zero-Emission Truck Journey – Today’s Trucking

Transport Canada is acknowledging that Canadian businesses face plenty of barriers in the journey to eliminate vehicle emissions, and that diesel or biodiesel will continue to drive longhaul trucking until new technologies and fuel sources reach scale.

But the funds to support available zero-emissions equipment are beginning to flow. The Incentives for Medium- and Heavy-Duty Zero-Emission Vehicles Program has so far allocated $545,700 and attracted 37 applicants asking for a collective $2.87 million in funding.

The observations are included in Canada’s Action Plan for Clean On-Road Transportation, which highlights a series of previously announced strategies such as a sales target that will require 35% of new medium- and heavy-duty vehicle sales to be zero-emission designs as early as 2030. Where feasible, all such vehicles in “a subset of vehicle types” will need to be zero-emission models by 2040.

December 21: Quebec ELD Enforcement Delayed Until June 1 – Today’s Trucking

Quebec will begin enforcing the federal electronic logging device (ELD) mandate on June 1, 2023.

Marc Cadieux, president and CEO of the province’s trucking association Association du Camionnage du Quebec (ACQ), shared the news of the delay after he and some of the largest carriers in the province held talks with Minister of Transport Geneviève Guilbault on December 21.

Cadieux said that the minister said she did not want another unexpected postponement and consequently, the application of the rules on ELDs would be postponed until June 1.

December 23: The Top 10 Trucking Stories of 2022 – Today’s Trucking

It was an eventful year, to say the least. Right out of the gate the Canadian trucking industry found itself in the international spotlight as trucks noisily rumbled their way from the West Coast to Ottawa where they parked for an extended, and unwelcome, stay.

It’s not often the industry attracts this level of attention – whether it be for right or wrong reasons. But while coverage of the ‘Freedom Convoy’ was far and away the most-read topic of the year, it was not the only newsworthy story. The electronic logging device (ELD) mandate was delayed once more, then finally enforcement plans were revealed. One of Canada’s largest and most recognizable trucking companies was purchased by a non-traditional buyer. Another of the most recognizable fleets on Canadian roads left the country.

Shipper-carrier relationships were a hot topic as shippers found themselves at the mercy of capacity-constrained fleets. And owner-operators who were attracted to record spot market conditions found themselves suddenly vulnerable as trucking conditions rapidly changed.

 

CIFFA Advocacy, Communications, Activities

December 7: CIFFA Holds Second Meeting with CN, Forwarders and Dray Carriers to Discuss Inland Terminal Congestion and Dwell Times

On November 30th, CIFFA held a follow-up meeting, chaired by Executive Director Bruce Rodgers, with representatives from CN, forwarders, dray carriers, importers and other trade associations.

The purpose of this session was for CN to provide a further update to the initiatives implemented to improve the situation of excessive container inventory and dwell.

CN representatives noted that, since the previous meeting, and thanks to initiatives put in place by CN, out-gate activity at terminals is higher than arrivals, resulting in an improvement in Toronto congestion. Similar improvements were also noted in various operating metrics across the terminal, indicating a recovery to more normal operations. Overall fluidity at the Port of Vancouver also turned positive, with zero vessels at anchor. While ground counts are much lower, the mix of Toronto-destined cargo on dock is still strong, which is a concern given the extended dwell at destination.

As a result, CN indicated the railway will revert to right-sizing trains to match destination capacity. Due to the recent improvements, plans are to increase the import volumes marginally, but to continue monitoring to ensure the level of out-gates is maintained.

There is significant focus on the level of imports still dwelling at the container yards, affecting optimal terminal fluidity. CIFFA encourages all stakeholders to work with their importers to retrieve containers as soon as possible, as the rail yards cannot be used as storage facilities.

CN has offered a further follow-up meeting in mid-January, to re-examine the situation and progress made.

December 13: CIFFA Brief on Shipping Conference Exemption Act

CIFFA provided a brief in response to the invitation from the federal government and the Minister of Innovation, Science and Industry, the Honourable François-Philippe Champagne, to comment on Canada’s competition policy and enabling legislation.

December 14: CIFFA Comment: Standing Committee on Transport, Infrastructure and Communities’ Report: “Improving Efficiency and Resiliency in Canada’s Supply Chains”

CIFFA released a comment on the federal government’s Standing Committee on Transport, Infrastructure and Communities’ report: “Improving efficiency and resiliency in Canada’s Supply Chains.” (The Standing Committee on Transport, Infrastructure and Communities primarily studies the legislation, policies and programs, and other issues of national importance related to transportation, infrastructure, and Canadian cities and communities, as well as the operations of Transport Canada and Infrastructure Canada.)

As noted by CIFFA, “Improving efficiency and resiliency in Canada’s supply chains” is a complex and critical issue in public policy and the committee’s diligence in examining it was much appreciated by the people who are living this situation every day.

The report recommendations provide the government with several valuable proposals that we believe should be acted upon.

 

Maritime

November 1: Maersk Gives Overstocked Retailers the Option to Slow Arrivals – gCaptain

Maersk says it is offering shippers the opportunity to slow cargo arrivals from Asia destined for European and U.S. ports to help retailers manage bloated inventories.

The initiative from the Danish logistics integrator comes as demand for retail lifestyle products from Asia plummets.

Maersk said that, with projected reductions in cargo demand, it was introducing “further measures to match cargo capacity with expected volumes on key tradelanes,” but in the case of blanked sailings or vessel slidings, it said its aim was to offer alternatives to “minimize the impact on customers’ business.”

November 3: Carriers Consider Laying Up Box Ships as Blanking Fails to Prop Up Rates – The Loadstar

The idled containership fleet has breached the 1-million-TEU capacity milestone – and is set to jump significantly higher as carriers prepare to temporarily suspend services rather than blank sailings.

According to Alphaliner, as of October 24, the number of inactive containerships either in drydock or seeking employment had reached 284, for a capacity of 1.2-million TEU, representing 4.6% of the global cellular fleet.

 

November 8: Liverpool Dockers Union Agrees to Accept Pay Offer, Port Says – American Journal of Transportation

The union representing dock workers at the Port of Liverpool agreed to accept an offer from the trade gateway’s operator, potentially ending weeks of pay disputes and periodic strikes, Peel Ports Group said.

Unite the Union will recommend the proposal to its members, Peel said in a statement, with a vote of the container operators set for this week.

November 10: Two-Year Low for Drewry’s World Container Index – Container News

Drewry’s World Container Index (WCI) took a 9% beating this week to end at US$2,773, which is the lowest figure over the past 24 months.

Having slipped past the US$3,000 mark, the index has lost 86% of its gains accumulated since the pandemic period. This is signaling towards the path that the slip in spot rates is yet to be over, despite a reported decrease in services, especially in the Transpacific trade and a high number of blank sailings.

The World Container Index is now about 26% off the five-year average of US$3,759.

The rates for China-U.S. trade have been inching lower, but at a lesser magnitude than the China-Europe rates or the weekly falls that we witnessed in September and October 2022.

November 14: Shipper Files FMC Complaint: Maersk ‘Flouts the Law to Rake in Profits’ – The Loadstar

A Florida shipper has issued a complaint against Maersk and its subsidiary, Hamburg Süd, that includes a failure to meet contractual obligations and “retaliation and collusion” to manipulate the market.

The complaint raised with the U.S. Federal Maritime Commission on November 9 is by furniture importer OJ Commerce, which says the carriers failed to address the alleged contract breaches.

It said Maersk then retaliated by refusing to negotiate a new contract, which left the shipper unable to negotiate with other lines, which had by then completed contract negotiations, and it was forced to book cargo on the substantially more costly spot market.

November 16: Government of Canada Invests in the Port of Prince Rupert to Increase Supply Chain Capacity – Transport Canada press release

Canada’s Minister of Transport Omar Alghabra on November 15 announced an investment of nearly $75 million under the National Trade Corridors Fund to increase capacity at the Port of Prince Rupert. With Trigon Pacific Terminals Limited’s contribution, the total combined investment in the project will be $163.1 million.

The funding will support the construction of a second berth at the Port of Prince Rupert terminal. This second berth will help reduce congestion, and increase the port’s capacity to export products for green energy and other clean commodities. This project will also increase the capacity of the trade corridor linking the Port of Prince Rupert to Western Canada.

November 17: Improved Shipping Reliability Adds to Retailer Woes as More Stock Pours In – The Loadstar

Less congestion on the high seas has put additional pressure on some retailers already struggling with too much stock.

Wary of missing deadlines for their Q4 sales, they increased lead times, but now some are having to pay extra to hold back new stock as their warehouses are already full.

One forwarder explained: “Lots of retailers are unable to get what has become over-ordered stock into their distribution centres and warehouses.

“Detention and demurrage charges are mounting at ports or off-dock facilities as warehouses are full. This is additional, considerable cost off the bottom line that needs paying for from the supply chain/logistics budget.”

November 18: Carriers ‘in Panic Mode’ as Recession Bites, Offering ‘Crazy’ Ocean Rates – The Loadstar

Ocean carriers are said to be in “panic mode” as bookings from China to North Europe and the U.S. west coast tank, causing FAK rates to plunge to new depths.

Despite aggressive blanking that has reduced weekly capacity on the tradelanes by more than a third, the lines have failed to slow the precipitous fall in short-term rates and, are arguably fuelling the fire by offering sub-economic spot rates via their digital platforms.

For example, rates from Shanghai, Tianjin and Shenzhen to the Le Havre-Hamburg range of container hubs in North Europe, of $1,000 per 20ft and $1,800 per 40ft are now widely available for prompt shipment.

And some carriers are said to be prepared to reduce rates further for volume, and relax or even waive demurrage and detention conditions.

November 21: Forwarder Frustration as Ro-Ro Bookings Look to Be Impossible Until Q2 23 – The Loadstar

Bookings for all ro-ro routes from Europe to the Middle and Far East and most to the U.S. are expected to be suspended until at least the second quarter of next year.

Carriers are battling too little capacity amid a boost in demand to carry freight.

One forwarder said: “Rates are increasing, capacity is at an absolute premium, with some routes fully booked four months out, and if you have a vehicle to move or other machinery, you can only book today for March/April sailings on some lanes.”

“There is a little space on ro-ro ships heading to the U.S., but their prices are up 30% on the standard rates,” one UK-based forwarder explained.

November 22: Plunging Spot Rates Drag Down Container Shipping Contract Rates – FreightWaves

Shipping lines are still posting billion-dollar quarters despite a precipitous plunge in spot rates, courtesy of high-priced annual contracts signed by cargo shippers at the peak of the boom.

But the reprieve is only temporary. Record rates on existing annual deals are being renegotiated lower mid-contract. Many shippers are not delivering previously agreed-upon contract volumes. And the next round of annual contract negotiations is looming, promising a big step down in rates and volumes for 2023.

To get the latest on the deteriorating ocean freight market, read an interview with Patrik Berglund, CEO of Xeneta, a Norway-based company that tracks both short- and long-term container shipping rates.

November 25: Record Blankings as Freight Rates Threaten a Hard Landing for Box Lines – The Loadstar

The unrelenting decline in container freight rates from Asia, caused by a collapse in demand, is compelling ocean carriers to blank more sailings than ever before as vessel utilization hits new lows.

Drewry’s WCI Asia-North Europe component slumped a further 18% this week, to $2,192 per 40ft, and is down 75% since August. Rates from China to North European hub ports now being touted by forwarders sank below the watershed $1,500 per 40ft benchmark.

“I’d be reluctant to book at that,” said a Felixstowe-based forwarder, “in case it came a few hundred dollars lower in a couple of weeks.”

“What worries me is that if we pass on to our client a very low rate, he will do his sums based on those freight costs, and then suddenly the market pivots again and the carrier lumps-on some hefty GRIs or other surcharges,” said the forwarder.

Another UK-based forwarder is concerned about future instability in the liner industry if the market does not normalize at sustainable levels. “We really wanted to see lower rates that are sustainable, but I fear the complete opposite is about to happen; too-low rates will not be sustainable and force a weaker liner to go ‘pop’,” he said.

November 29: Lines Adopt ‘Wait-and-See’ Pose in Korea as Truck Strike Negotiations Fail – The Loadstar

Police in Busan, home to South Korea’s main container port, have begun escorting truckers through picket lines manned by their striking colleagues.

Police set up a special hotline for truckers delivering essentials to call for help if they are being prevented from doing their jobs, and at least 50 HGVs have been escorted through.

The industrial action began on November 24, and the first round of negotiations on November 28, between the Cargo Solidarity Truckers Union and government officials, failed to reach a compromise.

Meanwhile, shipping lines are taking a wait-and-see approach to the truckers’ strike, but none intends to skip calls to Busan and other important container ports in the country.

November 30: Decaying Demand Sees China’s Ports Building Empty-Container Mountains – The Loadstar

Amid a “very quiet” end-of-year shipping season, empty containers are piling up at Chinese ports.

According to Alice Tang, China-Europe land transport planner at ITS Cargo, there has been a complete reversal of the severe equipment shortages of last year’s pandemic-induced cargo boom. “Empty containers are piling up at ports including Guangzhou, Yantian and Shekou,” she said.

“Some say they are already piling up on roads, while others say 90% of box spaces are occupied. Trailer drivers used to bring loaded containers to the terminal and pick up empty containers for the next load. Now, most of the drivers no longer pick up empty containers because there is no ‘next shipment.’”

 

 

Air

November 4: Air Cargo Market Continues to Deflate Under Global Economic Pressures – American Shipper

The air cargo market continued to unwind 18 months of record gains in October, as the global economy slows and consumers tighten their purse strings.

The industry is well into the typical peak season with little sign of increased shipping activity. Demand and rates are falling at a time when both normally climb.

Volumes in October, measured by a formula that combines weight and shipment dimensions, fell 8% versus the same period last year, the eighth consecutive month of demand decline, market intelligence firm Xeneta reported last week.

Performing at last year’s record levels, which were driven by pandemic-related shortages and supply chain disruptions, was not sustainable, but October demand also fell 3% below the level in 2019 – a weak year for air cargo. And IATA said demand was negative 3.6% versus three years ago.

November 5: WestJet Warns of Days of Flight Disruptions Ahead After System-Wide Outage – CBC News

WestJet is warning of days of delays to come, after a system-wide outage hit the airline on Saturday, November 5.

The airline cancelled more than 200 flights throughout the weekend, while other flights faced significant delays.

In a statement on November 6, WestJet’s chief operating officer Diederik Pen said that, although the airline’s systems were back online, they remained unstable and disruptions were ongoing.

“Further delays and cancellations in the coming days will be required, as we work diligently to recover our operations,” he said.

November 17: Air Canada Invests in Canadian Technology that Captures Carbon Directly from the Air to Fight Climate Change – Air Canada press release

Air Canada has announced an equity investment/loan of $6.75 million into Canadian climate solutions company Carbon Engineering (CE). The investment supports the advancement of CE’s Direct Air Capture (DAC) technology, which pulls carbon dioxide (CO2) directly out of the air at industrial scale.

Under its Climate Action Plan, Air Canada has committed to achieve net-zero GHG emissions by 2050. To help achieve this goal, the company created a $50 million investment fund to support new technologies. The $6.75 million being invested in CE comes from this fund and follows on an earlier announcement by Air Canada that it is investing US$5 million in Heart Aerospace, a Swedish company developing electric hybrid aircraft.

According to CE, its DAC process uses large fans to pull in air and then, through a series of processes, extracts the CO2 while returning the other air components to the environment. The captured atmospheric CO2 can be used to reduce aviation emissions by producing sustainable aviation fuels (SAF) that can be drop-in compatible with today’s aircraft. The captured CO2 can also be safely and durably stored in geologic reservoirs to provide carbon dioxide removals that can be used to offset GHG emissions.

November 22: Boeing Certification Troubles in Canada Ground First WestJet Freighters – FreightWaves

A delay in getting four 737-800 aircraft, newly converted to freighters by Boeing, certified by the Canadian government has set back WestJet’s plans to expand into freighter operations by nine months.

The four cargo jets are sitting idle on the tarmac at Calgary International Airport, WestJet’s home base, while Boeing awaits approval from aviation authorities for the design changing the used passenger aircraft into a dedicated freighter.

WestJet now expects to commence all-cargo flights on March 26, the start of the summer flying season, said Kristin de Bruijn, executive vice president of cargo.

November 23: Air Cargo to Join Box Shipping in ‘Overcapacity Corner’ – Air Cargo News

Air cargo faces a stint in ‘overcapacity corner’ next year alongside the ocean shipping sector, according to data analyst Xeneta.

The data firm said that weaker volumes and higher capacity would result in overcapacity in air cargo next year.

Xeneta said air cargo faces a “bumpy ride,” as lower ocean costs and better schedule reliability – from easing port congestion and available capacity – may tempt some shippers to make a modal shift.

The analyst said that environmental awareness could also push shippers to switch general cargo from air to ocean.

 

 

Rail

November 11: CN Joins EMP Program, Sets New Gulf Coast Export Program Record – Progressive Railroading

Last month, CN joined Norfolk Southern Railway and Union Pacific Railroad as an exclusive partner in the Equipment Management Pool (EMP) program.

The domestic interline service program aims to provide extensive coverage throughout North America by offering a fleet of more than 40,000 53-foot dry containers. The EMP program provides seamless access to all major cities within Canada and the United States, and numerous major markets in Mexico.

CN’s participation in the EMP program enables shippers to reach new west, east and southern markets, leveraging the networks of the largest Class Is while enhancing CN’s participation in the North American supply chain, CN officials said in an online post.

November 11: Union Pacific Demanding Container Seals Beginning in Mid-2023 – WorldCargo News

The Union Pacific Railroad (UP) has issued a customer advisory stating that it will require container seals on all intermodal shipments beginning in mid-2023.

An earlier advisory said the requirement would begin on December 5, 2022, but UP has now moved the start date back to an unspecified day in mid-2023.

During the coronavirus pandemic, containers on rail cars around Los Angeles were subject to thefts on multiple occasions. Media outlets ran stories about poor security, highlighting that the containers were being opened with impunity by thieves who would go through the contents and discard unwanted items on the track.

UP said it will require theft deterrent or barrier seals on all intermodal containers carried on its network. “This requirement is to provide the highest level of protection from unauthorized entry into intermodal containers or trailers during all levels of logistics transportation from the shipper,” stated UP.

November 14: Boilermakers Reject Labour Agreement with U.S. Freight Railroads – FreightWaves

Members of the International Brotherhood of Boilermakers (IBB) have decided not to ratify a labour agreement with the U.S. railroads, stakeholders said on November 14.

IBB members represent about 300 rail employees, many of whom work on repairing locomotives.

IBB joins two other unions in rejecting the labour deal and returning to the bargaining table.

Meanwhile, members of the two largest unions representing locomotive engineers and train conductors – the Brotherhood of Locomotive Engineers and Trainmen (BLET), the International Association of Sheet Metal, Air, Rail and Transportation Workers – Transportation Division (SMART-TD) – are voting this week on whether to ratify their labour contracts. Those results are expected to come out on November 21.

Seven other rail unions have voted to ratify their labour deals.

November 21: Two Unions Split Votes on U.S. Rail Labour Agreement, Opening Up Possibility for Strike in December – FreightWaves

The two remaining U.S. railroad unions to vote on whether to ratify their labour agreements have split their votes, increasing the possibility that a rail strike could occur in December.

Members of the Brotherhood of Locomotive Engineers and Trainmen (BLET) and yardmasters with the Transportation Division of the International Association of Sheet Metal, Air, Rail and Transportation Workers (SMART-TD) have voted in favour of ratifying the agreement.

But SMART-TD train and engine service members have voted to reject the tentative agreement reached September 15, sending SMART-TD back to the bargaining table with the freight railroads.

November 30: U.S. House Passes Bills to Avert Rail Shutdown, Add Paid Sick Leave – Next, to Senate – Supply Chain Dive

House lawmakers approved a legislative package on November 30 that averts an economically damaging rail strike or lockout while still keeping the door open for workers to secure paid sick leave.

Legislators passed two resolutions: One forces four holdout unions to accept their rejected contract as written, which includes the biggest wage increase in decades, plus expanded health coverage. The other amends the tentative agreement to include seven days sick leave, which workers had pushed for, arguing they can’t take time off in the case of a short-term illness.

The two measures still need Senate approval before they can head to the president’s desk for his signature. Democrats are walking a fine line between supporting labour while still avoiding a strike or lockout expected to cost the economy $2 billion a day.

 

 

Trucking

November 3: Feds’ Fall Economic Statement Takes Aim at Driver Inc. Employers – Today’s Trucking

The federal government has vowed in its fall economic statement to take aim at Driver Inc. employers.

“In the trucking industry, there is a long history of companies using the misleading Drivers Inc. practice, whereby drivers are encouraged to self-incorporate and operate as independent contractors without being provided information on the downsides of the practice,” the feds wrote in the statement.

“By not classifying drivers as employees, companies are denying them access to important rights and entitlements under the Canada Labour Code, such as paid sick leave, health and safety standards, employer contributions for Employment Insurance and the Canada Pension Plan, and provincial or territorial workplace injury compensation.”

The statement indicated that a recent pilot enforcement project found that more than 60% of federally regulated transportation employers fell into this category. It proposed to provide $26.3 million over five years, beginning in 2023, to take stronger action against non-compliant employers through Employment and Social Development Canada.

November 7: ELD Rules to See Mixed Enforcement on January 1 – Today’s Trucking

Federally regulated carriers – as well as carriers that work exclusively within the borders of Newfoundland, New Brunswick, Ontario, Manitoba and Yukon – will have to use electronic logging devices (ELDs) as of January 1. But plans in other jurisdictions vary.

“B.C. and Quebec will not be able to enforce the federal regulation by January 1, as updates are still being worked on,” said Private Motor Truck Council of Canada president Mike Millian in a bulletin to members. “While they expect enforcement to begin sometime in 2023, no confirmed timetable was available.

“The Northwest Territories won’t be ready on January 1 but expect to begin enforcement sometime before the end of January. All other jurisdictions indicated they either are or will be ready to begin enforcement of the federal regulation by January 1.”

B.C. and Quebec plan to enforce the rules for provincial carriers but have not confirmed timelines, while Nova Scotia will require carriers that operate solely in that province to have ELDs on January 1, 2024. Carriers that run exclusively in the Northwest Territories will face a mandate before the end of January.

Alberta and Saskatchewan have no current plans to require ELDs provincially. Provincial carriers that operate in P.E.I. operate only within a 160-km radius, which does not require a logbook or an ELD.

November 7: Fleets Face ‘Very Steep’ Learning Curve on Road to EVs – FleetOwner

When fleets succeed or fail based on operating costs calculated at fractions of a penny per mile, unknowns in the spreadsheet are a big problem. And, based on formal and informal discussion at the recent ATA Management Conference & Exhibition, those unknowns are tempering many truckers’ enthusiasm for electric vehicles.

The good news: Most folks I spoke with are fans of the vehicles themselves, or at least see the potential based on some test drives and demonstration runs. But many aspects of fueling an alt-fuel vehicle have yet to be determined, and you can’t run a fleet on good intentions.

November 17: Clean, Safe Operations Key to Recruiting Women, Experts Say – Transport Topics

Expressing a clear desire to hire women and maintaining a safe, clean work environment are keys to expanding their representation in the trucking workforce, experts said at a recent event hosted by Women In Trucking Association.

“Women look at safety differently,” said Danielle Bansch, national account manager at commercial driver licence staffing and recruiting firm TransForce Group. She stressed that they look not only at a safety culture that promotes avoiding accidents, but also safety while travelling and sleeping on the road.

“They want clean trucks and nice facilities. If you have that, advertise it. If not, fix it,” said Bansch, a 12-year veteran at TransForce.

November 18: Pay Structures, Schedules Shift in Face of Truck Driver Shortage – Today’s Trucking

Several Canadian fleets are rethinking everything from pay models to work schedules in a bid to recruit and retain truck drivers – even if such changes present challenges of their own.

A shift from mileage rates to hourly pay offers one example of that, but it’s not the only way fleets are rethinking longstanding business models.

Fleets are also rethinking the ways they schedule work in a bid to improve the lives of those who sit behind the wheel.

November 23: Federal Regulators Propose Fines for Hours of Service, ELD Violations – Today’s Trucking

Transport Canada is looking to establish a series of penalties under federal hours of service rules – with the most severe infractions generating fines as high as $2,000 for motor carriers and $1,000 for drivers.

Several of the penalties involve rules around electronic logging devices (ELDs), which all federally regulated carriers will see enforced beginning January 1.

“If an individual is both a driver and a motor carrier, they could be subject to pay the applicable fine as driver and the applicable fine as motor carrier,” Transport Canada adds in a document about the related consultations, referring to the trucking industry’s independent contractors.

Drivers would face fines of up to $300 for minor administrative and recordkeeping issues, while carriers would be fined up to $600. For carriers, such infractions would include failing to ensure an ELD is configured to record yard moves or that trucks are equipped with ELD user manuals. Minor infractions for drivers would include issues like failing to accept or reject a carrier’s change to a record of duty status.

 

 

CIFFA Advocacy, Communications, Activities

CIFFA Holds Meeting with CN, Forwarders and Dray Carriers to Discuss Inland Congestion

On October 31, CIFFA held a meeting with representatives from CN, forwarders and dray carriers. The meeting was convened to allow all participants to better understand the complexities and challenges that each group is experiencing and attempt to collaboratively develop short-term solutions to ease the pressures being experienced.

The situation seems to be worsening, primarily with the return of empty containers, with longer wait times being experienced, increased same-day cancellations and no-shows, and continued congestion issues being communicated from the Port of Vancouver.

CN’s representatives commented on the tremendous teamwork involved to clear the congestion from the Port of Vancouver but noted that there has been a significant lack of absorption of import inventories into the Toronto and Montreal markets.

CN has tried to move more volume to consumer markets so customers can get products on the shelves, but out-gate speeds have not caught up with volumes brought in, leading to congestion. CN is adopting measures that should result in easing congestion and targeting long-dwelling containers to move from container yards. This should result in improvements to carter turn times.

Representatives of the dray community mentioned that there is a drayage driver shortage and companies have a high turnover rate. The challenge for drivers is the time spent waiting both outside and inside the terminal. The carriers asked for better communication from CN for the drayage community. Many dray carriers do not have their own yards. Some carriers are not picking up boxes because every available yard has been filled with containers. This has become a huge problem.

CN offered a follow-up meeting toward the end of November to re-examine the situation.

 

Maritime

October 3: Carriers Now ‘Begging for Business’ as Volumes and Rates Tumble – The Loadstar

Xeneta’s long-term XSI shipping index fell last month for the first time since January, and is likely to drop sharply in the coming months as shippers demand cheaper new contracts and mid-term rate reductions.

The modest 1.1% decline in the XSI last month “won’t be the last,” according to Xeneta CEO Patrik Berglund, who said market fundamentals suggested that the erosion of long-term contract rates would “pick up pace as the year draws to a close.”

He explained: “In short, this means the shoe is finally on the other foot when it comes to upcoming contract negotiations for Q4 and beyond. Shippers are in the ascendancy, while carriers will now be competing to lock in volumes in the face of lower global demand.”

The sharp downturn in the market in the past few weeks has seen carriers scrambling for cargo and having to tap the spot market to supplement disappointing contract volumes.

“The carriers are back on the phone again, begging for our business, and the rates are coming down all the time,” one forwarder contact told The Loadstar. “But there are a couple of lines we won’t be supporting again after the way they treated us,” he said.

Nonetheless, both spot and contract rates are still considerably higher than before the pandemic.

October 6: Transnet Declares Force Majeure at South African Ports over Strike – News 24

South Africa’s logistics utility Transnet declared force majeure at its ports on October 6, according to a document seen by Reuters, as workers began an open-ended strike over wages.

Transnet operates South Africa’s freight rail network and all the country’s ports. It said the strike action would have a profound impact on economic activity across all sectors, and it urged workers to consider the long-term consequences of the strike on themselves and the economy as a whole.

October 7: Spot Rate Carnage Could Result in More Ships Laid Up, ‘with Worse to Come’ – The Loadstar

Ocean carriers could be forced to mothball more eastbound transpacific U.S. west coast loops, and the vessels that operate them, to stop the extraordinary haemorrhaging of container spot rates, which have halved in value in the past four weeks.

According to the October 7 reading of the China-U.S. west coast component of the Freightos Baltic Index (FBX), the spot price for a 40ft plunged 20% this week, to $2,361, compared with a typical premium rate a year ago of $20,000, a two-thirds decline since May.

Ships are reported to be leaving Asia for the U.S. west coast barely three-quarters full, despite aggressive blanking by carriers, and spot rates are on track to fall through the $2,000 watershed next week.

And unless carriers take radical action to take out more capacity on the route, rates could dip below pre-pandemic levels before the start of the contract season, which will severely hobble the lines’ negotiating position.

Moreover, in the interim, BCOs sitting on contracts some four times higher than the spot market are said to be receiving ‘temporary’ rate reductions from carriers to keep their loyalty.

October 11: The Government of Canada Announces How It Will Change the Way Ports Work – Transport Canada press release

Canada’s Minister of Transport, the Honourable Omar Alghabra, announced on October 11 the completion of the Ports Modernization Review, which aims to advance the role of Canadian port authorities and optimize their current and future roles. In a constantly changing world, ports need modern and flexible tools that will allow them to respond to increasingly complex challenges. These new tools will enable ports to remain competitive, efficient and sustainable.

The minister also announced that the government intends to introduce legislative amendments in the coming months to update the way Canada’s ports are managed and operated based on the results of the Ports Modernization Review. The proposed legislative changes will achieve several key policy objectives, including:

The Government of Canada intends to update its approach to considering infrastructure investments of Canadian and international entities to ensure our ports continue to serve Canadians well into the future by remaining competitive and aligned with our economic prosperity and security.

October 11: Maritime Employers Association’s AI Project Galileo: Improved Visibility Will Help Port of Montreal Terminals Appropriately Assign Port Workers – MEA press release

The Maritime Employers Association (MEA) has launched its artificial intelligence project, Galileo, which is designed to improve the planning surrounding dispatch of the Port of Montreal workforce.

Using AI, Galileo will make it possible to accurately predict the arrival time of ships up to 21 days in advance. This is a tremendous improvement over the status quo – which allows for only 24 hours of real-time visibility – and is expected to improve the performance and increase fluidity at the Port of Montreal.

Taking into account port traffic, the weather and the quantity and type of merchandise, Galileo will propose an optimal scenario for the dispatch of the labour force that both respects collective agreements and factors in the availability of port workers in the required classifications. Terminal operators will have an additional resource at their disposal to help them make better decisions regarding their labour needs.

The MEA will share this data with other stakeholders at the port, and will advise them as to the best time of day to begin their operations.

An entire supply chain ecosystem will benefit from this improved visibility and will be able to better plan the handling of merchandise between ship, road and rail.

October 12: Shipping Lines Still Raking in Billions Despite Sinking Cargo Demand – American Shipper

There’s no shortage of schadenfreude toward shipping lines these days. After making hundreds of billions in profits during the pandemic, there is gleeful talk of their looming comeuppance – of plummeting spot rates and carriers begging for business.

But shipping lines are still pocketing billions of dollars in profits each quarter. Spot rate declines and volume reductions are still being easily offset by higher contract rates.

Recently released data from Asian carriers reveals that financial performance is still close to peak levels and has a very long way to fall before liner operators come even close to breakeven.

October 14: Evergreen Joins Compatriot Lines in Renegotiating Shipping Contract Rates – The Loadstar

Evergreen has followed its fellow Taiwanese carriers, Yang Ming and Wan Hai, in beginning to renegotiate contract terms with shippers.

The carrier’s general manager, Eric Hsieh, said: “We need to reduce the spread between the contract and the spot market.

“Currently, individual cases are discussed according to the different agreed freight rates and the customer’s needs.”

October 14: Container-Ship Logjams Off U.S. Ports Finally Easing as Imports Fall – American Shipper

The good news is that there were fewer than 100 container ships stuck waiting off North American ports on October 14. The bad news is that there were still 99 container ships offshore and the pre-COVID norm was in the single digits.

There’s still a long way to go to clear the backlog. But the current tally is now back to June levels and 35% off recent highs.

October 20: Ocean Carrier Voyage Blankings Causing Chaos and Confusion – The Loadstar

Ocean carriers are ramping up their vessel blanking programs from Asia as export demand weakens, but last-minute cancellations are causing chaos in supply chains and confusion within liner offices.

Moreover, shippers are having to navigate their way around “officially” announced blank sailings and voyages pulled just days before arrival in China and held off the loading port, in what carriers term as “slidings.”

A UK-based NVOCC said liner sailings from China had become “pot luck” and accused carriers of running “tramp services” instead.

October 20: Vancouver Congestion Remains, Montreal Facing Low Water – Inside Logistics

Congestion at the Port of Montreal has declined, but low water levels have prompted a new surcharge. And on the West Coast long wait time for vessels at the Port of Vancouver continue.

In its weekly ports update, Maersk reports on vessel wait times at North America’s major ocean ports. Vancouver is “experiencing heavy congestion,” it said.

Currently the Port of Vancouver has the longest wait times of any port on the list. Its vessels are waiting up to 28 days to unload, the liner company said. It reported Vancouver’s yard utilization at 85 percent, and average rail dwell at seven days.

However, its numbers do not reflect the port’s own report, which suggests that wait times at anchor or offshore have declined significantly. In August, the port reported average dwell times of just over 30 days. At present, it reports that number has dropped to 6.6 days.

October 27: Complaints about Carriers Stack Up at the Federal Maritime Commission – Splash

The U.S. Federal Maritime Commission is keeping busy with an increasing number of complaints from shippers.

The latest two to emerge involve Israeli carrier ZIM and Mediterranean Shipping Co. (MSC).

“The softened market – and space situation – may well cause a flurry of suits and FMC complaints to be filed,” commented Bjorn Vang Jensen, a vice president at liner consultancy Sea-Intelligence, in a post on LinkedIn last month.

“The collective, pent-up anger and PTSD in the BCO community at large now wants out, and rate reductions won’t cut it for some,” said Jensen.

October 28: Shipping Rates Are No Longer Plunging. Is ‘New Normal’ Near? – American Shipper

Ocean shipping spot rate indexes are still falling. But after months of steep declines, they’re dropping much less rapidly than before. It could be just a temporary plateau before the next leg down. Or it could be something more significant: the first sign of the market bottom, the post-pandemic “new normal.”

Different spot rate indexes publish different numbers, and critics contend that indexes don’t reflect actual rates. But the consensus is that indexes are a good indicator of the general direction of pricing. And the direction spot indexes are headed lately is more sideways than down.

 

 

Air

October 3: Airfreight Rates on Key Lanes Continue Gradual Descent in September – Air Cargo News

Airfreight rates on key trade lanes out of Asia continued to weaken in September despite the industry heading towards the peak season.

The latest figures from the Baltic Exchange Airfreight Index (BAI) show that, in September, rates from Hong Kong to North America declined by 18.5% compared with a year ago, to $7.94 per kg, and are down on the $8.33 per kg achieved in August.

The declines are noteworthy for two reasons: First, rates on the trade lane tend to increase from August to September and second, it is only the second time since February 2020 that prices on the trade have registered a year-on-year decline.

October 7: Air Cargo Peak Season Evaporates on Low Demand, High Capacity – American Shipper

It’s the time of year when retailers typically make their final push to ship goods from abroad in time for holiday shopping and freight rates are highest, but so far signs of peak season in air cargo are difficult to find. Instead, rates continue to slide as global economic clouds dampen demand and airlift supply rises with the recovery of passenger travel.

Air freight spot rates tumbled 9% year over year in September to below the 2021 level for the first time this year, reported Xeneta, an ocean and air freight rate benchmarking and data analytics firm.

The cost to ship by air lowered another 2.8% in the past week and is now 21.6% less than a year ago, according to the Baltic Air Index. A year ago, rates were up about 80% on a yearly basis.

Analysis by WorldACD, another provider of air freight data, also shows tonnage and prices slipping marginally again in the second half of September. More notable, however, is that volume is down 12% from last year despite a 6% increase in capacity. Its data also reflects a 10% decline in spot rates to an average of $3.46 per kilogram.

October 20: Airlines Fill Less Cargo Space as Consumer Spending, Trade Sag – American Shipper

Prospects for a fourth-quarter bounce in air cargo business as retailers stock up for the holidays are dim, the culmination of a gradual slowdown in shipment traffic and costs since Russia’s invasion of Ukraine in March.

And worsening macroeconomic conditions suggest the air logistics sector could face a darker 12 to 18 months after peaking a year ago. Forty-five percent of customers polled last week during a webinar hosted by logistics specialist Flexport said they intend to ship less by air in 2023.

The International Air Transport Association projected air cargo demand would grow 4% this year, after COVID supply chain disruptions sparked a 7.9% gain in 2021. Through August, overall volumes were down 5.4% and have continued their sequential slide. In September, volume as measured by chargeable weight to move shipments slipped below pre-pandemic levels for the first time, according to air freight data aggregator Xeneta.

 

 

Rail

October 4: CN Shares Plan for Winter Operations – Inside Logistics

CN has published its plan for winter operations in 2022 and 2023.

The plan sets out the measures the railway will introduce to ensure it has the capacity and resources to maintain operations in cold winter weather.

The measures introduced include adding staff and new locomotives, along with new rail cars and monitoring technology.

October 11: Large U.S. Rail Union Rejects Deal, Renewing Possibility of Strike – Transport Topics

The U.S.’s third-largest railroad union rejected a deal with employers on October 10, renewing the possibility of a strike that could cripple the economy. Both sides will return to the bargaining table before that happens.

Over half of track maintenance workers represented by the Brotherhood of Maintenance of Way Employees Division who voted opposed the five-year contract despite 24% raises and $5,000 in bonuses. Union President Tony Cardwell said the railroads didn’t do enough to address the lack of paid time off – particularly sick time – and working conditions after the major railroads eliminated nearly one-third of their jobs over the past six years.

The group that represents the railroads in negotiations emphasized that no immediate threat of a strike exists because the union agreed to keep working for now.

Four other railroad unions have approved their agreements with freight railroads including BNSF, Union Pacific, Kansas City Southern, CSX and Norfolk Southern, but all 12 unions representing 115,000 workers must ratify their contracts to prevent a strike.

October 26: Second U.S. Railroad Union Rejects Deal, Adding to Strike Worries – Transport Topics

A second railroad union rejected its deal with the major U.S. freight railroads on October 26, reflecting workers’ increasing frustration with the lack of paid sick time in the industry and adding to concerns about the possibility of a strike next month that could cripple the economy.

The Brotherhood of Railroad Signalmen said nearly 61% of the workers who voted opposed the five-year contract even though it included 24% raises and $5,000 in bonuses.

October 31: Frustrated Shippers Caught in Canadian Rail Congestion Call for Help – CIFFA Cited – The Loadstar

Predictions that congestion at rail yards in Canada’s interior would ease this month and next are not playing out so far, prompting frustrated importers and forwarders to ask for government intervention. The problems are most pronounced at rail hubs around Toronto and Montreal.

According to the Canadian International Freight Forwarders Association (CIFFA), the situation has been exacerbated by government efforts to help reduce congestion at west coast container gateways (notably Vancouver), which only served to push the problem to inland rail facilities already struggling to cope with volumes.

Now, forwarders and importers are looking to the authorities for help to fix the problem. Bruce Rodgers, executive director of CIFFA, has asked federal agencies like Transport Canada and the Canada Border Services Agency to help.

“Recent decisions by government to clear the backlog at the Pacific gateway only resulted in a worsening situation. Without foresight, decisions were made, not to work on a solution to the problem, but to shift the burden inland.”

 

 

Trucking

October 18: Driver Inc. Threat Approaching Point of No Return: CTA – Today’s Trucking

The Canadian Trucking Alliance (CTA) is warning that the labour scheme known as Driver Inc. will become the dominant business model in trucking if regulators fail to act on the issue this year.

“The industry is approaching the point of no return, as upwards of 25% of the industry is estimated to be involved in some form of the Driver Inc. scheme already,” CTA president Stephen Laskowski said in a press release.

“Without committed action by the end of the year, this model will likely become solidified as the dominant employment practice as the [federal] government moves ahead with the implementation of Bill C3 – Paid Medical Leave and other planned Labour Code reforms – which Driver Inc. companies claim do not apply to them.”

Under the Driver Inc. model, fleets sidestep employer obligations by misclassifying employees as independent contractors.

October 21: Labour Shortages, Port Delays, Housing Affordability Squeeze Trucking in Atlantic Canada – Today’s Trucking

Labour shortages, port delays and housing affordability are some of the major challenges facing the trucking industry in Atlantic Canada. This is compounded with issues like Driver Inc., not enough immigration, the upcoming 10 days of sick leave for drivers and the January 1, 2023, ELD mandate.

There are positives too, like the announced twinning of Highway 185 in Quebec.

Highlighting the backlogs in the Port of Saint John and Port of Halifax, Trevor Bent, chairman of the Atlantic Provinces Trucking Association (APTA), said wait times have skyrocketed. “The ability to get containers out has been reduced by 50%. APTA members are saying if they could move six containers out a day, it has now dropped to three.”

He called for solutions to make things more efficient, including fixing labour, scheduling and land issues.

Bent said housing shortages and affordability are a challenge when trying to attract talent to Atlantic Canada. The construction sector, trucking’s largest competitor for labour, is also looking for workers.

October 31: New U.S. Survey Finds Perils Abound for Owner-Operators – Bulk Operator

Slowing economic activity and correcting supply chains have reduced the need for capacity and are driving the outlook for rates and demand lower, leaving higher-cost carriers worried about turning profits, according to the latest Bloomberg Intelligence-Truckstop survey of owner-operators.

Pessimism among carriers has touched the pandemic lows seen more than two years ago, in the first quarter of 2020: About 33% of respondents expect load growth to decline over the next six months, the lowest reading since 1Q 2020 and significantly higher than 3Q 2021 at 9%. Many carriers raised concerns over the strength of the upcoming peak season. Refrigerator carriers were the most optimistic, with only 10% of those surveyed projecting a volume decline in the coming months.

 

 

CIFFA Advocacy, Communications, Activities

October 5: CIFFA Presents to the House Standing Committee on Transportation, Infrastructure and Communities

CIFFA presented to the House Standing Committee on Transportation, Infrastructure and Communities on October 5. Information on that presentation, including the full text of CIFFA’s remarks, is available in the Forwarder Online.

October 6: CIFFA Supports Proposed CP Logistics Park in Vancouver

CIFFA has written to the Canadian Transportation Agency (CTA) to voice support for the CP Logistics Park in Pitt Meadows, B.C. CP is seeking CTA approval to develop the project on 41 hectares of CP-owned land on the south side of CP’s existing Vancouver Intermodal Facility.

The proposed project consists of three major rail and transload components, namely:

Further details of the proposed project can be found at vancouverlogisticspark.ca.

October 9: CIFFA Statement on the National Supply Chain Task Force Final Report: Action, Collaboration, Transformation. (ACT)

CIFFA issued a statement following the release of the final report, Action. Collaboration. Transformation., of Canada’s National Supply Chain Task Force.

CIFFA’s statement highlights and champions particular points and calls to action in the report. The association looks forward to working with the Transport Minister and department, providing further input – after submitting input to the Task Force in July – as actions promoted in the report are implemented.

October 17: CIFFA Overview of Future Borders Coalition Summit

CIFFA’S Director, Policy and Communications Julia Kuzeljevich attended Future Borders Coalition Summit in Washington, D.C. on October 12 and 13.

Laura Dawson, Future Borders Coalition’s Executive Director, opened the full-day conference session on October 13 noting that between Canada and the U.S., there are very few “true disputes.” Most issues between the two countries can be resolved with consultation or discussion.

Matt Morrison, the Executive Director for the Pacific Northwest Economic Region, and the Co-Chair of the Future Borders Coalition, noted that the U.S. and Canada have the largest trade relationship.

He called for more members to come into the coalition and bring their significant user experience to the table to make the Canada-U.S. border work better.

Solomon Wong, President and CEO of InterVISTAS, who wrapped up the day of presentations, and discussed the FBC’s next steps, made note of the FBC’s latest release, a report on the digital border.

Read the full summit overview.

October 21: Message from CIFFA Executive Director Bruce Rodgers Regarding Ongoing Challenges in Doing Business in Canada

Members of CIFFA are increasingly frustrated by the ongoing challenges and rising costs of doing business in Canada.

CIFFA’s members have increasingly been asking the Secretariat office to do more to raise awareness around the issues they are facing: congestion, delays, capacity issues, inability to pick up or return containers, mounting fees for demurrage/detention, and no one to whom they can raise these issues with satisfactory results.

Our role, though not to point fingers at any party, has become a convoluted and frustrating one. While we have aimed to facilitate collaboration wherever possible, the issues are that there is no longer a supply “chain” in Canada, but supply “links,” each operating in a fragmented and siloed approach. Until there is a significant commitment to work collaboratively on “connecting these links,” in the national public interest, these issues will persist, undermining transportation and the supply chain overall.

Read the full statement.

 

 

Maritime

September 6: Vancouver Port Defers Rolling Truck Age Program to April 3, 2023 – Today’s Trucking

The Port of Vancouver will defer implementation of the Rolling Truck Age Program by a final six months to April 3, 2023, according to a letter issued by the port authority on September 3.

The program banning container-hauling trucks with model years older than 2006 in a bid to control emissions was expected to go into effect on September 15.

Transport Canada indicated during discussions that a final adjustment to the program schedule would provide additional flexibility to better enable operators to comply with requirements, the letter addressed to Truck Licensing System (TLS) participants stated.

September 7: North Sea Port Congestion at Critical Level, Hindering Global Trade – The Maritime Executive

Supply bottlenecks and congestion in container shipping are becoming more entrenched and are impacting the global exchange of goods warns the Kiel Institute for the World Economy (IFW) in its latest update on global trade.

According to its analysis, the IFW warns that congestion in container shipping is becoming entrenched at a high level. They calculated that around 11 percent of all shipped goods are currently stuck. In the anchorages observed by the Kiel Institute, congestion in the North Sea is the most serious for the first time. They reported that well over 2 percent of global freight capacity is at a standstill there and can neither be loaded nor unloaded. In the German Bight alone, 19 container ships are waiting to unload their goods.

September 8: Yang Ming ‘Under Pressure’ from Shippers Demanding Contract Rate Cuts – The Loadstar

Yang Ming COO Chang Chao-feng has admitted that, as spot rates fall, the carrier is under pressure from shippers demanding to renegotiate contract rates.

The line is believed to be the first to confirm receiving demands from shippers for lower contract fees and, on September 7, Mr. Chang said the situation had become more challenging than in mid-year.

He said: “In May, whether for shipments to Europe or the U.S., both shippers and our side were optimistic when negotiating contract rates, which were high. The sharp drop in the spot rates has caused great pressure on these contracts.

“We will discuss the contracts with our customers. At present, some still respect the spirit of the contract. We won’t take the initiative to request immediate modifications and adjustments, but we’ll make necessary adjustments, depending on the contract.”

September 13: U.S. FMC Seeks to Limit Ocean Carriers’ Leverage on Container Space – American Shipper

The Federal Maritime Commission is proposing a rule aimed at preventing ocean carriers from locking out customers from the carriers’ available vessel space.

The notice of proposed rulemaking (NPRM), expected to be published this week in the Federal Register, will give the public 30 days to comment on a provision included in the Ocean Shipping Reform Act of 2022 that prohibits ocean carriers from unreasonably refusing to deal or negotiate with respect to vessel space accommodations.

“The NPRM outlines the elements which would be necessary to establish a violation and the criteria the [FMC] would consider in assessing reasonableness if the NPRM is finalized,” the document states. “The NPRM proposes a burden-shifting regime that would allow ocean common carriers to establish why it was not unreasonable to refuse vessel space to a particular complainant.”

The proposal stems from numerous complaints by shippers as well as trends over the past two years revealing dramatic changes in the U.S. import-export balance, particularly between the U.S. and Asia. Shippers have alleged – and the FMC has documented – that carriers have been taking advantage of more lucrative import rates at the expense of reasonable rates and service provided to exporters.

September 15: Port of Quebec Longshore Workers Locked Out – Canadian Union of Public Employees press release

At noon on September 14, the Société des arrimeurs de Québec locked out 81 longshore workers at the Port of Quebec.

On August 30, longshore workers at the port voted 98.5% in favour of pressure tactics up to and including strike action and have resorted to some of them in the time since to move along the discussions at the bargaining table.

The parties have been in talks since June 2022. Discussions have bogged down over work schedules.

September 16: DCSA Digital Standards Poised to Become Globally Accepted – The Loadstar

The Digital Container Shipping Association (DCSA) has become the front-runner in setting digital standards.

Earlier this month, the European Shippers Council announced a collaboration with the DCSA to drive forward to adoption of DCSA standards. Further, Federal Maritime Commission (FMC) commissioner Carl Bentzel recently praised the DCSA as an invaluable tool for streamlining maritime transport.

DCSA standards have also seen burgeoning acceptance outside of Europe and the U.S., in the form of the recent announcement of the Maritime and Port Authority of Singapore (MPA) and the Port of Rotterdam Authority to develop the “world’s longest green and digital shipping corridor.”

September 19: Fall in Container Spot Rates ‘Much Steeper,’ ‘Less Orderly’ Than Expected – American Shipper

Shipping liner executives predicted a continued drop in spot rates during their latest quarterly calls, while offering soothing assurances to investors that the fall would be gradual. Maersk CFO Patrick Jany said it would be a “progressive erosion,” not “a one-day drop.” Matson CEO Matt Cox emphasized rates were “adjusting slowly” in an “orderly marketplace” and not “falling off a cliff.”

The decline may indeed be fairly steady, as opposed to the sudden, violent swings seen in bulk commodity shipping. Yet spot container rates appear to be falling more rapidly than some liner executives expected.

September 19: Rhine Water Levels in Germany Approaching Normal Depths – MarineLink

Water depths on the Rhine River in Germany have risen thanks to recent rain and are approaching normal levels after falling this summer to lows that disrupted transportation, vessel brokers and commodity traders said on September 19.

But since dry weather was forecast for much of this week, levels could fall again and the picture has not yet normalized, brokers said.

Weeks of high temperatures and scant rainfall in August lowered water levels in the river, Germany’s commercial artery, causing delays to shipping and pushing up freight costs. There were fears the disruption could knock half a percentage point off economic growth in Europe’s biggest economy this year.

September 20: Liverpool Dockers Begin Two-Week Strike After Rejecting Pay Offer – The Loadstar

Dock workers at the port of Liverpool began a two-week strike on September 20, following the breakdown of negotiations with employer Peel Ports.

Felixstowe dockers, also in a dispute over pay, will start an eight-day strike on September 27, ending on October 5.

The International Transport Workers Federation (ITF) said the action was the result of “a failure by Mersey Docks and Harbour Company (MDHC) to honour promises on pay, and profiteering.”

Dockers at both Felixstowe and Liverpool are members of Unite and have been negotiating for inflation-level pay increases with their respective employers, who claim they have made generous offers, rejecting calls to meet higher wage demands.

September 20: Maersk After Drop in Shipping Prices: ‘We Do Not Renegotiate Contracts’ – Børsen

Container freight prices have tumbled in recent weeks, prompting customers to ask carriers to review existing price agreements.

This is not an option at A.P. Moller-Maersk, which will not renegotiate agreements prematurely, the shipping and logistics group told MarketWire.

“Of course, we have an ongoing dialogue with our customers about how best to help them in relation to their logistics needs, but we do not renegotiate contracts,” Maersk said in a written response.

September 21: Wan Hai Says It May Be Open to Reducing Shipping Contract Rates ‘Short Term’ – The Loadstar

Wan Hai has become the second liner operator to acknowledge requests from shippers to reduce contract rates in the wake of falling freight rates.

Similar pressure was reportedly experienced by Yang Ming earlier this month.

Primarily an intra-Asia carrier, Taiwanese Wan Hai entered the transpacific trade in 2020 with U.S. west coast sailings, followed by east coast services last year.

At the time, transpacific rates were at historically high levels, but have since fallen below $3,500/FEU, from a peak of $17,500 last October.

A spokesperson for Wan Hai said: “Some customers did request a renegotiation of contract rates. Our response is to discuss it with them, and we may give discounts for a short period, depending on the market conditions.”

September 21: Exposed Carriers Struggling to Pay Sky-High Charter Rates – Splash

The abrupt plummet in boxship charter rates is making plenty of headlines, with warnings that some carriers are struggling to keep up with their rental payments for ships signed earlier at sky-high prices.

Classic panamax tonnage has been fixed in recent days at rates of $40,000 and $50,000 for periods of six months, according to Alphaliner, roughly half what such a vessel size could have obtained only a few weeks ago for the same durations.

September 22: Sea-Intelligence: Carriers Are Increasing Blank Sailings in October – The Maritime Executive

The major shipping lines are once again resorting to blanking sailing from their schedules as a means of controlling capacity after an extended period of deploying every available ship to meet the surge in demand. Using the guise of the upcoming Golden Week holiday tied to China’s Autumn Festival, carriers are expected to increase the number of cancelled sailings above historic norms according to the latest calculations from the analysts at Sea-Intelligence.

September 29: Union Rejects Wage Offer, Plans Broader Second Strike at Liverpool – The Maritime Executive

Union officials are planning to increase the pressure on UK ports, announcing plans for a second strike at the port of Liverpool that will encompass more of the employees of Peel Ports, operators of the container port. The announcement of a second strike at Liverpool comes five days before the first strike is due to end and, according to analysts, the timing is designed to increase disruptions to the UK’s supply chain.

Currently, nearly 600 dock workers and engineers are in the second week of a two-week strike called by the union that began on September 20. The first strike is due to end on October 2, and Unite now reports that the workers will resume the strike between October 11 and 17.

September 29: Pacific Pilotage Authority Issues Notice of Proposed Revised Service Charges – PPA notice

The Pacific Pilotage Authority issued a notice last week of its proposed revised charges.

The notice includes a description of the proposal, including justification in relation to establishing or

revising the pilotage charge, and the circumstances in which the charge will apply.

Persons interested in making representations to the Authority regarding the proposal may do so in writing no later than close of business on October 30.

 

 

Air

September 22: Air Canada Executives Target Doubling Cargo Business by 2024 – American Shipper

The man who got rid of Air Canada’s last freighter as CFO 15 years ago now says as CEO he wants to double cargo revenue – with the help of the airline’s new freighter fleet.

Decades ago, Air Canada flew Boeing 727-100, Boeing 747 Combi (passenger and cargo sections on the main deck) and DC-8 cargo jets. All were eventually removed from the fleet in the 1990s, part of an industry trend in which most passenger carriers determined the cost structure and infrastructure required didn’t justify a separate freighter division in a market with regular peaks and valleys. The cargo division continued its job using the belly space on passenger aircraft.

But Air Canada reassessed its strategy during the pandemic. Cargo became such a strong source of revenue when passenger flying mostly stopped and scores of planes – some with seats removed for extra cabin storage – were repurposed as auxiliary freighters, that Air Canada decided to capitalize on market projections for robust e-commerce shipping growth and fewer widebody passenger jets.

September 23: Boeing CEO: Promises About Clean Aviation Fuel Outpace Technology – American Shipper

Expectations for quick decarbonization of aviation are unrealistic and create pressure to invest in unproven technologies instead of mass production of sustainable aviation fuel, which will have an immediate benefit, said Boeing CEO David Calhoun.

Speaking at a recent U.S. Chamber of Commerce aerospace event, the Boeing chief questioned the speed at which governments and stakeholders are promising change when little biofuels infrastructure exists and alternative propulsion systems are still over the horizon.

“My fear is pace. A lot of potential technologies, hydrogen, including green hydrogen, get talked about, want to get funded and then lead to policy choices that try to accelerate all of that at a very fast pace: ‘You’ll be green by 2035. Every next airplane has to be hydrogen.’

“You confuse policymakers in the process,” he said.

September 26: A Lift for Belly Capacity on the Way After Hong Kong Lifts Hotel Quarantine Rule – The Loadstar

Hong Kong has scrapped its hotel quarantine rule, paving the way for extra bellyhold cargo capacity and a potential boost to the city’s ailing economy.

Previously, travellers entering Hong Kong had to quarantine at a hotel for three days, followed by four days of movement restrictions, but this has been replaced by daily testing for the first week after entering the city.

Cathay Pacific said the new measures would allow for the “strengthening of network connectivity to, from and through the Hong Kong aviation hub,” adding that it would launch 200 pairs of regional and long-haul passenger flights in October.

 

 

Rail

September 8: CN Update on Toronto-Destined Cargo over CN-Mississauga Intermodal Service Centre – CN Customs Bulletin #68

While all efforts are being made to maximize utilization of all authorized offsite depots, CN is still seeing a large number of import containers dwelling at its Toronto terminals. CN is moving Customs-cleared containers to the offsite facilities, however the volume of Customs-cleared containers is insufficient to address the congestion. As a result, CN is forced to look at alternate options to shuttle additional containers.

In consultation with federal government agencies, CN will be handling some Toronto-destined cargo over CN’s Mississauga Intermodal Service Centre (MISC) (Port 0495/sub-location 5974).

The goal is to increase the volume of imports that can depart the ports, thereby reducing the time container ships are anchored in Canadian ports. The Canada Border Services Agency (CBSA) is participating in this solution and has established processes to be followed.

CN will pre-identify containers once they depart a port in Western Canada and will notify CN’s immediate customers of the change within 24 hours of train departure. While this initiative targets containers moving from ports in Western Canada only, the solution may be extended to ports in Eastern Canada as well should the need arise.

September 12: U.S. Railroads Cut Service in Preparation for Potential Strike – Supply Chain Dive

The four largest U.S. railroads began limiting service on September 12 in preparation for a potential strike that stands to bring freight rail movement across the country to a halt.

Norfolk Southern, Union Pacific, BNSF and CSX all announced they will issue embargoes on certain shipments beginning early this week.

CSX, BNSF and Union Pacific all halted traffic of hazardous materials due to the threat of “spontaneous labour action,” according to the Association of American Railroad’s list of active embargoes.

Norfolk Southern and CSX said the embargoes were necessary to ensure that critical or even toxic freight is not left abandoned.

September 15: U.S. Railroad Strike Averted as Unions, Companies Reach Tentative Deal – Reuters

Major U.S. railroads and unions secured a tentative deal after 20 hours of intense talks brokered by the Biden administration to avert a rail shutdown that could have hit food and fuel supplies nationwide.

The tentative deal now goes to the unions to be voted on. Even if those votes fail, a rail shutdown that could have happened as soon as midnight on September 16 has been averted for several weeks due to the standard language included in such a deal.

September 23: Two Biggest U.S. Rail Unions Won’t Tally Contract Votes Until the Middle of November – Trains

The two biggest rail unions don’t expect to tally members’ votes on their tentative contract agreements with the Class I railroads until the middle of November.

The SMART-TD union that represents conductors and the Brotherhood of Locomotive Engineers and Trainmen that represents engineers both outlined ratification vote timelines this week in updates to their members.

On September 22, the BLET began a 15-day question and answer period during which general chairmen will reply to the national president’s office with any questions or clarifications regarding the tentative agreement.

“Those questions will be consolidated into a single document, and the BLET’s National Wage Team, alongside SMART-TD, will return to the bargaining table with the carriers to mutually agree upon the answers to those questions,” the BLET said.

Once the Q&A session is complete, ballots will be distributed on or around October 14, with the BLET tentatively set to tally the votes on November 17.

 

 

Trucking

September 9: Driver Inc. Enforcement to Expand – Today’s Trucking

Canada’s Labour Program has acknowledged that the Driver Inc. business model – which involves misclassifying employees as independent contractors – is “widespread.” And it’s preparing to expand related enforcement initiatives.

Much like a recent pilot project in Ontario, the national strategy will involve outreach to promote good employment practices, increase proactive inspections and continue enforcement activities with non-compliant carriers.

Carriers misclassify truck drivers as independent contractors to avoid or bypass labour laws. The end result denies employees access to things like vacation pay, overtime and termination rights under the Canada Labour Code, said the bulletin distributed by provincial trucking associations.

September 13: CN Update Regarding Valleyfield Intermodal Terminal

Further to the tariff update it sent on July 25, CN advises that Valleyfield Terminal will be closing as of September 30. CN will support all Montreal-destined traffic at its Taschereau Intermodal Terminal.

Note the following related to the Valleyfield Intermodal Terminal:

September 14: Canadian Roadcheck Inspections Ground 22.6% of Vehicles – Today’s Trucking

Canadian enforcement teams placed 22.6% of inspected vehicles out of service during the international Roadcheck blitz that was conducted May 17 to 19, compared with a 23.8% out-of-service rate in the U.S.

Teams completed 3,359 Level 1 inspections on this side of the border, placing 760 vehicles and 191 drivers out of service, the Commercial Vehicle Safety Alliance (CVSA) reports. In the U.S., there were 33,196 Level 1 inspections, with 7,912 vehicles and 2,051 drivers placed out of service.

Level 1 inspections involve 37 steps and include vehicles and drivers.

September 29: Recruitment and Retention Becomes a Costly Challenge for Trucking, U.S. Execs Say – Transport Dive

Hirschbach Motor Lines President Brad Pinchuk says the carrier’s driver hiring costs have spiked by about 2.5 times since the onset of the pandemic.

“We’re having to work harder to keep our trucks filled,” said Pinchuk. “We’re keeping them full, but we’re having to work a lot harder. We’re having to spend a lot more money.”

Retaining workers across the industry has become costlier. Driver wages per mile in the U.S. jumped 10.8% from 2020 to 2021, increasing from 56.6 cents to 62.7 cents, according to the American Transportation Research Institute’s 2022 cost of trucking report.

Bill Kretsinger, CEO of American Central Transport, said drivers are also expecting more from their employers.

 

 

CIFFA Advocacy, Communications, Activities

September 22: CIFFA Alberta Customer/Member Engagement Receptions

CIFFA held two Western Canada customer engagement receptions this week, on September 20 in Calgary and September 21 in Edmonton.

Calgary – Hyatt Place Calgary Airport, September 20

Cocktail reception and presentations

Edmonton – Renaissance Edmonton Airport Hotel, September 21

Cocktail reception, networking dinner and presentations

CIFFA thanks its Alberta-based membership and interested prospects for their attendance, support and feedback.

September 29: CIFFA Strategic Planning

On September 28 and 29, CIFFA held a strategic planning session and National Board of Directors meeting. The meetings were held in Port Credit, Ontario.

Working with Sartori Consulting, CIFFA’s strategic planning focused on governance, with a review of CIFFA’s previous plan, what worked and what didn’t, and proceeded with discussions and exercises around defining CIFFA’s strategic goals and measurements to achieve these. A multi-year plan for the focus and direction of the association will be developed following the meeting.

Maritime

August 3: Carrier Schedule Reliability Records First Year-Over-Year Improvement in More than Two Years – The Maritime Executive

After hitting a low point at the beginning of 2022, schedule reliability and delays among the container carriers are steadily improving. The market is showing the first signs that the supply chain is managing after the challenges over the past two years brought on by the pandemic and the surge in consumer demand. This progress comes after the end of lockdowns in China but despite labour strikes at ports and persistent reports of backlogs.

“Global schedule reliability seems to have broken the trend seen since the start of this year,” said Alan Murphy, CEO of Sea-Intelligence. “This also marked the first time since the start of the pandemic that schedule reliability improved year over year.”

August 4: Traffic Restrictions Cause Congestion Concerns for Carriers at Nhava Sheva – Container News

Maersk Line has reported a slowdown in truck flows in/out of India’s Nhava Sheva Port/JNPT as a result of new traffic restrictions imposed by local authorities.

“Traffic police have issued a notice on movements of heavy vehicles from Nhava Sheva CFS [container freight station]/yard,” the carrier said in a customer advisory. “Heavy vehicle movement from JNPT area is, therefore, leading to traffic congestion. All these restrictions are beyond our control and this may lead to delays.”

The carrier has called on cargo interests to plan their shipments in advance to avert cargo gate-in delays/roll-overs.

August 4: DP World: Inland Network Congestion Affecting Marine Terminals – DP World customer advisory

On August 4, DP World issued a customer advisory related to berthing delays on the West Coast due to inland network congestion, particularly in Toronto and Montreal.

As these inland terminals became congested, the supply of rail cars to the marine terminals was restricted/stopped, which has had a major impact on both DP World Prince Rupert and Vancouver.

August 9: Container Lines Are Set to Smash Year-Old Profit Record by 73% – American Journal of Transportation

The world’s biggest container lines are on course to post profits in 2022 that will top last year’s record by 73%, according to a new forecast, buoyed by logistics and labour strains that are squeezing capacity amid sustained U.S. demand for imports.

Net income this year will likely reach $256 billion based on the 11 carriers monitored by industry veteran John McCown, the founder of Blue Alpha Capital. That’s an increase of $36 billion from his prior estimate in April and roughly equivalent to the gross domestic product of Portugal. The figure last year hit an all-time high of $148 billion, according to McCown.

August 10: Historic Drought Threatens to Cripple European Trade – American Journal of Transportation

In the midst of an arid summer that is setting heat records across Europe, the continent’s rivers are evaporating.

The Rhine – a pillar of the German, Dutch and Swiss economies for centuries – is set to become virtually impassable at a key waypoint later this week, stymieing vast flows of diesel and coal. The Danube, which snakes its way 1,800 miles through central Europe to the Black Sea, is gummed up too, hampering grain and other trade.

Across Europe, transport is just one of the elements of river-based commerce that’s been upended by climate change. France’s power crisis has worsened because the Rhone and Garonne are too warm to effectively cool nuclear reactors, and Italy’s Po is too low to water rice fields and sustain clams for “pasta alle vongole.”

August 12: More Blank Sailings Likely as Spot Rates Tumble – gCaptain

Container spot rates are falling fast on all export routes from China in what should normally be the peak season for demand.

According to the August 12 reading of the Ningbo Containerized Freight Index (NCFI), all 21 of the routes it covers were trending in the red.

Alongside headlines of another tranche of record eye-watering quarterly profits posted by ocean carriers last week, there was a general acceptance from the lines that the supply/demand scales were shifting back in favour of the shipper. Both short-term prices and long-term contract rates were experiencing downward pressure.

August 12: Fall in Imports and New Cranes Ease Congestion at Chittagong Port – The Loadstar

An increase in cargo handling equipment and a decline in import cargo has seen Bangladesh’s prime seaport, Chittagong, significantly reduce both volumes and berth waiting times for vessels.

Less traffic at the ports is due in part to government constraints on the import of luxury items, following a severe fall in foreign currency reserves.

August 16: China’s Yangtze River Also Reports Falling Water Threatening Shipping – The Maritime Executive

While attention is focused on the falling water levels along the Rhine and its impact on Germany and Europe, word comes that China is facing a similar challenge along the Yangtze, the country’s longest river. China in recent years has invested heavily in the Yangtze, always one of the most important inland waterways in the country, seeking to enhance its role in both supplying inland regions and becoming an increasingly important pipeline to move exports to the major seaport at Shanghai located on the Yangtze Delta.

As southern parts of China endure historic heatwaves and drought, water levels at Hankou, a key monitoring point on the Yangtze River near Wuhan, dropped to 17.54 metres (57.5 feet) last week, which the authorities report is about six metres (20 feet) lower than the average in recent years. According to local media, citing Chinese disaster response authorities, this is the lowest level seen for this time of the year since records began in 1865.

August 17: Reefer Rates Bolstered by Congestion, Shortages and Drought in Key Regions – The Loadstar

Equipment shortages have helped prop up freight rates for reefers, even as dry container prices continue to decline.

According to Rafael Llerena, CEO of 3PL EasyFresh, reefer freight rates have remained high despite an apparent tail-off in demand on other trades.

He said: “Reefer rates have held up not only because of the higher trade leg demand, compared with dry cargo, but also as a result of a shortage of equipment. Reefer containers have to compete with high-priced laden dry containers on the return leg from Asia and are facing congestion, which slows boxes returning from the U.S.

“Moreover, non-operating reefers have been used to replace dry cargo units on certain trades over the past few months, but these are taking a long time to return to loading ports due to congestion problems, schedule reliability issues and blank sailings from Asia, delaying rotation and supply.”

August 18: Maersk Shifting Vancouver Calls Due to Congestion – Inside Logistics

Delays and congestion have promoted Maersk to alert customers to changes in its scheduled calls at the Port of Vancouver.

In a note to customers, the liner company said West Coast terminals have experienced berthing delays in recent weeks due to inland network congestion, particularly in Toronto and Montreal. As these inland terminals became congested, the supply of rail cars to the terminals was restricted/stopped.

This situation has had a detrimental impact on the terminals, which are not designed for storing containers. Despite the projected expansions in both Vancouver and Prince Rupert, the terminal throughput hasn’t increased. Maersk reported that Centerm is at 108 percent capacity, while the yard at Prince Rupert is at 110 percent.

To work around the congestion, Maersk informed customers it is aligning its TP9 sailings from Asia to match the cadence at Centerm. This means every TP9 vessel in the queue is being evaluated for possible changes to the rotation. This includes calling at Seattle first in the rotation.

It also means sending TP9 ships to Prince Rupert for discharge of all Vancouver rail cargo. These vessels include Tyndall 219N, Maersk Singapore 229N, Anna Maersk 226N and Maersk Laberinto 220N.

August 19: Carriers Ease Rates Ex-India as Demand Falls and Capacity Returns – The Loadstar

With export volumes slipping amid global demand growth woes, container lines serving Indian trades are putting new rate hike plans for the traditional peak season on the back burner.

MSC has pulled back from issuing its general rate increase (GRI) and peak season surcharge (PSS) notices this month on the India-U.S. trades, while other liners have, tactically, kept themselves out of the pricing race, thus far.

After carriers managed to hold rates at elevated levels over the past two months, new industry data suggests they have now begun to implement measurable contract/spot price reductions for Indian bookings to U.S. base ports, in order to optimize vessel space allocations for the region.

August 22: Strike at Port of Felixstowe Set to Upend Supply Chains – American Journal of Transportation

About 2,000 dockers at the Port of Felixstowe began an eight-day walkout on August 21, halting the flow of goods through the UK’s largest gateway for containerized imports and exports, which handles about a third of Britain’s total container volume and an even bigger share of direct trade with Asia.

Shipping lines plan to reroute cargo around the picket line, adding time and cost. A.P. Moller-Maersk A/S said last week that two ships will skip usual stops and unload Felixstowe-bound consignments at continental ports before sending them on when the strike ends. Another will switch to DP World Ltd.’s London Gateway, the UK’s third-busiest port.

The strike could disrupt more than $800 million in trade, according to Russell Group, a data and analytics company. Though it’s too soon to evaluate any wider hit to growth, companies are anticipating longer delivery times and higher expenses that can only hurt Britain’s inflation-ravaged economy.

August 22: The Sinking Price of Ship Fuel: Near Prewar Levels after Summer Plunge – American Shipper

It was yet another warning sign on inflation: The price of fuel for commercial ships spiked after Russia invaded Ukraine and hit all-time highs in May and June. But that trend has now reversed. The price of ship fuel plunged in July and August and is now back to roughly prewar levels.

According to Ship & Bunker, the average price for fuel known as very low sulfur fuel oil (VLSFO, sulfur content: 0.5%) at the world’s top 20 refueling hubs was $800 per ton as of August 19. That’s down 29% from the all-time high of $1,125.50 on May 14. Just before the war, VLSFO averaged around $750 per ton.

August 23: Congestion and Capacity Shortage in Europe Sees Barge Surcharges Soar 150% – The Loadstar

Barge surcharges in Europe have soared 150%, due to hinterland congestion and container transport’s need to compete with demand for coal following Russia’s decision to cut gas supplies.

Contargo announced it would be increasing an emergency surcharge of €10 per transport of full or empty containers to €25 from September 1, heaping new misery on shippers that faced a week of closures on the Rhine.

Contargo said: “As well as the massive problems in seaports, substantial bottlenecks continue to affect our services on the rail network and inland navigation.

“Container barge transport is having to compete with coal and grain transport for the short capacities. The continuing very low water levels on the Rhine and its tributaries are increasing the demand for additional tonnage and driving prices up to critical levels.”

August 25: German Ports and Workers Agree to Terms to End Three Months of Strikes – The Maritime Executive

Germany’s unionized port workers and the association representing the seaport operators agreed to terms for a new contract after one of the longest running labour disputes in Germany in decades. The tentative agreement came just three days before a cooling-off period imposed by the Hamburg Labour Court was due to expire and removes the threat of further strikes, which have been disrupting operations in all the North Sea Ports since June.

August 25: Volumes Dip at Chinese Ports Among New COVID Lockdowns – Inside Logistics

Import and export ocean shipment volume at Chinese ports over the past weeks has declined as strict COVID-19 lockdowns have returned in tourist towns.

FourKites reports its data show that, as several large Chinese cities have been rolling out stringent lockdown policies, volume at the Port of Shanghai has started to decrease since the peak in mid-July, down 18 percent since then.

The 14-day average ocean shipment volume is now down 11 percent compared with March 12th (the day before lockdowns went into effect) and down two percent week-over-week for shipments tracked by FourKites.

August 26: Crews Strike Seaspan’s Tugboat Operations at B.C. Ports – The Maritime Executive

The captains and other crew members aboard Seaspan’s tugboats that operate in the ports of British Columbia walked off their jobs on August 25, striking after their union failed to reach a new collective bargaining agreement with Seaspan.

The strike could impact operations at the Port of Vancouver, which has already been experiencing congestion and delays due to the increased container volumes, as well as a shortage of trucks and congestion on Canada’s rail lines.

August 29: Port of Vancouver Operations Update – provided by Port of Vancouver

The Canadian Merchant Service Guild (CMSG) commenced legal strike action against Seaspan effective August 25. Seaspan has been in direct contact with its contracted customers.

The Vancouver Fraser Port Authority is responsible for maintaining the safety and efficiency of navigation through the Port of Vancouver.

Labour action has affected the berthing, leaving berth or bunkering of four cruise ships and two bulk vessels. Activities with respect to these vessels have been resolved.

The port authority continues to work with multiple parties, including Transport Canada, toward swift resolution of operational delays.

August 30: COVID Lockdowns Return to Key Chinese Port Cities – Splash

COVID lockdowns are ticking up in China again, with neighbourhoods in key port cities such as Shenzhen and Dalian forced back home this week, and mass testing underway at other important maritime gateways including Tianjin.

There is no letup in the government’s zero-COVID policy, which has stretched global supply chains a great deal this year. The difference now is that, while outbreaks have been getting more widespread in the last fortnight, lockdowns are pursued neighbourhood by neighbourhood rather than city-wide, and quarantine times have been cut back since the middle of June, according to analysis from research firm Gavekal Dragonomics.

Nevertheless, the quickening spread of the omicron variant has some analysts concerned.

At a news conference on August 29, Shenzhen officials said the latest outbreak is mainly driven by new subvariant Omicron BF.15, which they said is more transmittable and harder to detect.

August 30: Northern Europe Port Congestion Eases as Demand Falls and Strikes and Holidays End – The Loadstar

A combination of improved labour availability due to the end of the school holidays and a reduction in Asian imports has eased congestion at North Europe’s container hubs.

A wage settlement last week at German ports is also expected to relieve the high yard density at Hamburg’s box terminals in the coming weeks.

According to new weekly data produced by supply chain intelligence company eeSea for the port of Rotterdam, congestion at the Dutch gateway and neighbouring Antwerp has declined significantly in the past few weeks.

 

 

Air

August 3: Air Canada Cargo Steps Up to 777F League as North America’s Only Combi-Carrier – The Loadstar

Air Canada Cargo has taken the next step in the expansion of its cargo business with an order for two 777-200 freighters to join the fleet in 2024.

The decision to go for factory-built freighters rather than convert passenger 777s was largely driven by the opportunity to get slots on the Boeing production line and have the aircraft available for service sooner, said Jason Berry, VP, Cargo.

At the same time, the investment reflects the outlook of the airline’s top management on the opportunities in the cargo business, he said. For a long time freighters had been anathema to the AC boardroom.

AC is in the middle of a rapid build-up of its maindeck capacity. It has two B767-300 freighters in operation and will take delivery of two more before the end of the year. These, along with three more, including two factory-built 767-300Fs, will bring the fleet to seven all-cargo aircraft by the end of next year.

August 4: Taiwan Flights Disrupted as China Shows Anger at Pelosi Visit – Inside Logistics

Taiwan canceled airline flights on August 4 as China fired missiles near the self-ruled island in retaliation for a top American lawmaker’s visit, adding to the risk of disruptions in the flow of Taiwanese-made processor chips needed by global telecom and auto industries.

China ordered ships and planes to avoid military drills that encircled Taiwan, which the mainland’s ruling Communist Party claims as part of its territory. The Hong Kong newspaper The South China Morning Post called the drills an “effective Taiwan blockade.”

August 19: Global Air Cargo Tonnage and Prices Continue Decline – Air Cargo Week

Global air cargo flown tonnages and prices continued their gradual decline in the first two weeks of August after volumes staged a brief and partial recovery in the second half of July, the latest figures from WorldACD Market Data reveal.

Looking at week 32, worldwide chargeable weight decreased 5% compared with the previous week, and the average worldwide rate decreased slightly, based on the more than 350,000 weekly transactions covered by WorldACD’s data and analysis of the main international air cargo lanes.

August 25: Edmonton International Airport Sets Up Logistics Beachhead for U.S. E-Commerce – American Shipper

At first blush Edmonton seems an unlikely destination for international air shipments bound for online shoppers in the United States.

Following some promising trial runs with e-commerce providers, Edmonton International Airport is banking on its geographic location along circumpolar routes, congestion-free facilities and Canada’s trade-friendly customs rules to advance a multibillion-dollar air logistics village and become a major cargo hub.

“Planes that typically would have stopped at another point [are using] Edmonton not just as a place to stop and get gas, but actually the ending point. And then we’re transporting the goods, by air, by road or by rail into parts of the U.S.,” said Myron Keehn, the airport’s vice president of air service and business development. “We’re seeing dramatic cargo growth because companies are realizing the efficiencies of actually using Edmonton as their jumping off point into the U.S. and then conversely, back into Asia or the Middle East.”

 

 

Rail

August 8: STB Says ‘Train Noise’ Would Be Only Negative Environmental Impact of CP-KCS Merger – Transport Topics

The Surface Transportation Board’s Office of Environmental Analysis determined the only potential adverse impacts of Canadian Pacific’s proposed merger with Kansas City Southern would be train noise, according to the STB’s draft environmental impact statement (EIS) released August 5. All other impacts were described as negligible, minor and/or temporary.

STB announced its findings as part of a 357-page document, which details its research into potential impacts caused by the proposed merger, including freight and passenger rail safety, grade-crossing safety, grade-crossing delay, truck-to-rail diversion, traffic at intermodal facilities, noise and vibration, air quality and climate change, energy, cultural resources, hazardous materials release sites, biological resources, water resources, environmental justice and other cumulative impacts.

Now that STB has announced its findings, its Office of Environmental Analysis is providing a 45-day public comment period beginning August 12 and ending September 26 to weigh in on the draft EIS.

August 15: STB Chairman ‘Not Optimistic’ about Pace of Rail Service Improvement in U.S. – FreightWaves

Surface Transportation Board Chairman Marty Oberman expressed doubt that the four major U.S. Class I railroads could ramp up rail service and reach the service targets they laid out by December.

In response to deteriorating service metrics, the STB in June required Union Pacific, BNSF, CSX and Norfolk Southern to resubmit plans detailing how they expect to improve rail service through the end of the year.

“I have to say that, if you look at the regular reporting metrics we’re getting, they are a long way from their six-month targets and we’re about halfway through that six-month period. So I’m not optimistic about the pace at which rail service can recover,” Oberman said on August 12.

August 30: Impasse in Labour Talks Continues as Possible U.S. Freight Rail Strike Looms – FreightWaves

The remaining unions that are still negotiating with the freight railroads on a new labour contract are grappling over wages and benefits, while a union coalition’s survey points to broad potential support for a strike.

Three unions – the Transportation Communications Union/International Association of Machinists, Brotherhood of Railway Carmen and International Association of Machinists and Aerospace Workers – last week reached a tentative agreement with the railways. Those unions, which represent nearly 11% of the more than 144,000 rail union members seeking a new contract, are now sending that agreement to their members for ratification.

Per the Railway Labor Act, the remaining unions would be able to legally stage a work stoppage or strike after a cooling-off period ends on September 16. That date is a month after the Presidential Emergency Board, a three-person independent panel appointed by President Joe Biden, gave the unions and the railroads a 124-page report with recommendations on how to resolve the contract negotiations impasse.

 

 

Trucking

August 2: Natural Gas Truck Sales Increase, But More Focus on Electrification – Today’s Trucking

Natural gas truck sales in the U.S. and Canada rose 11% year to date through May, according to ACT Research.

When it comes to the broader alternative-fueled-truck market, Steve Tam, VP at ACT Research, said: “We’re seeing an overall increase in electric charging stations, both existing and planned, but a continuing decline of total natural gas stations, particularly those planned for the future. That said, we still see articles about natural gas use in transportation, as well as discussions about hydrogen fuel cells and investments, but the overwhelming amount of trade industry headlines continues to focus on electric commercial vehicle development.”

August 4: Vancouver Port Truckers Delay Labour Action – Today’s Trucking

Truck drivers have decided to delay labour action at the Port of Vancouver for a few weeks after holding talks with port officials on July 30.

The Vancouver Fraser Port Authority said that officials met with representatives from the United Truckers Association (UTA) and Surrey Centre MP Randeep Sarai to hear the UTA’s perspective on operational challenges.

“No changes have been made to the Rolling Truck Age Program, which will go into effect on September 15, 2022, as previously announced. As of now, there are 15 trucks that will age out of the program on that date,” a port authority spokesperson said.

August 11: Trucking Execs See Volatile Demand as Retailers Cut Inventory – Transport Dive

U.S. trucking industry leaders are reporting mixed demand for services as retail inventories pile up with easing consumer demand.

While companies such as Landstar and Marten reported record Q2 revenue, some executives have also noted pockets of softening demand or even described future conditions as volatile and unpredictable. Many carriers are slowing, if not entirely stopping, hiring, after reporting labour shortages just months ago.

August 17: Autonomous Trucks Will Do Jobs Human Drivers Don’t Like, Panel Says – Today’s Trucking

As human drivers step back from longhaul and middle-mile work, autonomous trucks could help fill less-desirable roles.

Some might say this is going to take jobs away from drivers, but this is not so, says Stephan Olsen, Paccar’s general sales manager, fleet & specialty markets. Truckers want to be home every night and are seeking first- and last-mile jobs, he adds. Letting them choose jobs that offer more family time will keep them in an industry that is facing a truck driver shortage.

Let the machines do jobs that humans don’t want to do, he said.

August 24: PRPA Completes Fairview-Ridley Connector Corridor Project – PRPA press release

The Prince Rupert Port Authority’s (PRPA) Fairview-Ridley Connector Corridor has formally opened. Testing on the route got underway in mid-August, with container truck traffic beginning to travel to the newly opened southern gate at DP World-Prince Rupert Fairview Container Terminal, and the Corridor is set to be fully operational on August 29.

August 25: Truckers to Be Granted Access to Express Entry Programs, CTA Says – Today’s Trucking

Truck drivers will soon be eligible for participation in Express Entry Programs, Minister of Immigration, Refugees and Citizenship Sean Fraser has confirmed in correspondence to the Canadian Trucking Alliance (CTA).

“In light of an acute labour shortage and a strained supply chain, this is very welcomed news for our industry and by extension the Canadian economy,” said Jonathan Blackham, CTA director of public affairs.

“CTA has been calling on the Government of Canada to help address our sector’s growing labour shortages by working with our industry to improve access to immigration channels. This announcement is very timely and absolutely welcomed by the trucking industry.”

Express Entry is an online system that is used to manage immigration applications from skilled workers and is specifically designed for skilled immigrants who want to settle in Canada permanently.

August 31: ‘Race to the Bottom’ in Truckload Contract Rates Sets In – FreightWaves

Pressure is being let out of global freight markets as demand falls and lower volumes in a variety of modes are more easily handled by the capacity and infrastructure built up during the last two years of the COVID-19 pandemic.

Transportation rates in several modes, including truckload and ocean container, are falling as demand deteriorates and capacity loosens.

The softness started with American consumer demand, which has been wobbling and running out of momentum as the effects from fiscal stimulus faded and inflation took hold in the economy. Two quarters of negative GDP growth – coupled with very high import levels – depressed the demand for transportation capacity and caused trucking spot rates to plummet.

 

 

CIFFA Advocacy, Communications, Activities

August 8: Message from CIFFA Executive Director Bruce Rodgers Regarding Supply Chain Challenges – The Forwarder Online

Over the past few weeks, CIFFA’s Secretariat office has seen increased concerns with the ongoing challenges of the supply chain. Members are asking for help and guidance to deal with rising/additional costs, significant delays and an overall lack of information.

CIFFA has also been contacted by government officials at both the federal and provincial levels, seeking short-term solutions to the present situation. Our message has been both consistent and clear: There are no short-term wins in this situation.

Government awareness and interaction should have occurred several years ago. Many projects that remain tied up in bureaucratic red tape would have lessened the burden felt by many today. The Port of Vancouver’s Roberts Bank Terminal 2 expansion project and CN’s Milton Logistics Hub are two examples.

The situation, as most are aware, is both complex and complicated, one that involves many different stakeholders.

 

Maritime

July 3: California Ports Piling Up Again: Too Many Containers Sitting Too Long – American Shipper

At the height of last year’s “will Christmas be canceled?” supply chain freak-out, the ports of Los Angeles and Long Beach – with the Biden administration’s backing – proposed a highly controversial fee on import containers that sat too long in terminal yards.

The mere threat of this fee, announced on October 25 for implementation on November 15, seemed to initially chase more boxes out the gates, as designed. Every week since then, like clockwork, the ports have cited progress and announced that the fee enforcement would be postponed until the following week.

Now, the container dwell numbers are getting worse and becoming increasingly hard to sugarcoat.

July 4: Boxport Congestion Spreads Across the Globe Again – Splash

Boxport congestion is growing across multiple continents. Clarksons’ containership port congestion index shows that, as of June 30, 36.2% of the global fleet was at port, up from 31.5% in the pre-pandemic years from 2016 to 2019, with Clarksons observing in its latest weekly report that congestion on the U.S. east coast has recently risen to near-record levels.

An operational update from German carrier Hapag-Lloyd, issued on July 1, highlighted the myriad congestion issues facing carriers and shippers around the world.

Across key Chinese ports such as Ningbo, Shenzhen and Hong Kong, terminals are under pressure with yard and berth congestion thanks to ongoing COVID measures and the typhoon season.

At other key Asian ports, yard density is reported hitting 80% in Singapore and is higher still, at 85%, at South Korea’s top port, Busan.

July 4: Market Questions Peak Season Scale as Consumer Sentiment Drops – Hellenic Shipping News

Container freight market participants are looking with unease toward peak import season and beyond as booking inquiries for U.S. imports remain under pressure amid rising inflation and a weak economic outlook.

Trans-Pacific volumes and booking inquiries edged down further in the final weeks of the second quarter as shipowners reported lower vessel utilization out of Asian loading gateways. One shipowner source noted that “spot market space is ample out of China.”

In-kind freight on the North Asia-North America run has been under pressure during Q2 as pockets of vessel space have opened up. North Asia-to-West Coast North America slid 10% during Q2, coinciding with a dip in volumes brought on by extensive lockdowns in and around Shanghai, which began to unwind June 1.

But despite easing restrictions in Asia, volumes have failed to rebound to meet prior expectations, while consumer appetite appears to have waned in the U.S., and large retailers have been heard cutting back orders amid an abundance of inventory.

July 5: Average Global D&D Charges Fall, but Are Still Four Times Higher in the U.S. – The Loadstar

Average global demurrage and detention (D&D) charges have fallen this year, but remain around 12% higher than before the pandemic, according to a new survey by online equipment trading and leasing platform Container xChange.

However, the average is skewed by huge D&D fees imposed on shippers in the U.S.

Container xChange collected more than 20,000 data points from publicly available sources, which were then compared against D&D fees imposed on customers by carriers.

According to its findings the global average D&D charge levied by carriers two weeks after containers were discharged (the free time) increased by 38% last year to $868 per container, from $586 in 2020.

So far this year, the average D&D fee has eased to $664 per container.

July 7: Roberts Bank Terminal 2: Project Update and Next Steps

On March 15, the Impact Assessment Agency of Canada (IAAC) concluded a public comment period on the Vancouver Fraser Port Authority’s information request response and on the draft conditions for the project.

VFPA has provided a final submission to IAAC in several parts that shows how topics raised during the public comment period will be addressed:

Next steps in the project development

IAAC is reviewing submissions received during the public comment period to develop recommendations and final conditions for the Minister of Environment and Climate Change. The minister will then determine whether the project has significant adverse environmental effects and, if so, will refer the decision to cabinet.

The VFPA is hopeful that a decision will be made this year. In the meantime, the port continues to prepare for procurement, a Fisheries Act Authorization and other required permits, as well as ongoing consultation with Indigenous groups, to quickly advance the project if a positive decision is made.

July 7: Win Streak Continues: Container Lines Just Posted More Record Results – American Shipper

Ocean carriers are still posting record or near-record results. Several Asian liner companies have just released preliminary revenues and profits for Q2 2022, as well as monthly operating data through June.

Despite pessimistic sentiment on stocks, the numbers are still huge.

July 8: There’s Over $40 Billion in Cargo on Container Ships Waiting Offshore North America – American Shipper

Anchorages continue to fill with waiting container ships off East and Gulf Coast ports, where vessel queues have now far outgrown those off the West Coast. Along all three coasts combined, the number of waiting container vessels remains exceptionally high.

There were 125 container ships waiting off North American ports on July 8, according to an analysis of ship-tracking data from MarineTraffic and queue numbers from California.

Container ships waiting off U.S. and British Columbia ports had a combined capacity of 1,037,164 twenty-foot equivalent units.

July 13: More Than 3,000 Trucks Wait at Bangladesh’s Chittagong Port to Unload Exports – The Loadstar

Some 3,300 trucks, laden with export cargo, are waiting at the gates of the 19 off docks in Chittagong to unload goods, while some 9,300 TEU export-ready containers are awaiting vessel designation for shipment.

A seven-day suspension of trucks from highways was imposed in order to facilitate the movement of public buses and other vehicles for people leaving cities to celebrate Eid ul Azha.

The Bangladesh Inland Container Depot Association (BICDA) said they were forced to stop receiving cargo from July 6, after several thousand trucks arrived at the port.

The association said that, before shutting down factories for holidays, cargo owners sent all emergency and non-emergency shipments to the depots at once, creating congestion at the gates.

July 14: U.S. Feds Give Shippers New Power to Dispute Ocean Carrier Charges – American Shipper

New guidance issued by federal regulators aimed at fighting unreasonable ocean carrier charges is short on detail but long on historic importance, according to a U.S. exporter group.

The advisory enacts provisions of the Ocean Shipping Reform Act of 2022 (OSRA), signed into law last month, by providing a simplified process for container carrier customers who want the Federal Maritime Commission to investigate their complaints.

“Today is a landmark moment in the history of the Federal Maritime Commission and the U.S. shipping public,” said Peter Friedmann, executive director of the Agriculture Transportation Coalition (AgTC), in a statement. “The provisions in OSRA calling for informal processes to facilitate effective FMC enforcement are perfectly implemented in the Commission’s Industry Advisory today.”

The one-page advisory outlines steps for filing charge complaints against the carriers. Among the steps are identifying the carrier and the alleged violation, submitting documentation, confirming that the disputed charge was incurred after the June 16 enactment of OSRA, and submitting all the materials in one email, if possible, to the FMC.

July 20: Low Water on Rhine Threatens Repeat of 2018 – gCaptain

Low water levels in the Rhine River may have a similar impact on German economic output as they did in 2018, according to Berenberg, a European private bank.

That was the last year in which the river, a key waterway that’s critical for moving coal, car parts, food and thousands of other goods, experienced a “dry year,” economist Salomon Fiedler said in a report to clients.

Citing analysis by the Kiel Institute, he said that, in a month in which water levels are below the 78-centimetre (31-inch) threshold every day, German industrial production is “about 1% lower than in a month with no low-water days.” Delayed effects in the following month brings the overall impact to about 1.5%.

July 22: ‘Lines Banging on Our Door’ as Spot Rates Tumble and Peak Season Disappoints – The Loadstar

Container spot rates from Asia to Europe and the U.S. are coming under increased pressure, as the peak season appears “muted” at best.

Freight rates from China fell this week on 19 of the 21 routes covered by the Ningbo Containerized Freight Index (NCFI), with its China-Europe and China-U.S. components in particular dragged down by “insufficient volume.”

The NCFI commentary said most carriers had been obliged to discount as spot rates “continue to decline.”

Spot rates for North Europe fell to $9,092 per 40ft this week, according to Drewry’s WCI index, although the CEO of a UK forwarder said recently it had been offered a rate of $7,000 per 40ft through August.

“They were not interested a month ago, but now the carriers are banging our door down for business again,” he said.

July 28: Staff Strike Set to Hit Felixstowe in August – Seatrade Maritime News

Dockworkers at the UK’s largest container port voted in favour of strike action over a pay dispute.

The Unite union reported that 92% of workers voted in favour of industrial action on an 81% turnout. The vote comes after the Felixstowe Dock and Railway Company offered staff a 5% pay increase while the Retail Price Index (RPI) – a measure of inflation – stood at 11.9%. The latest pay offer adds to an increase last year of 1.4%, again below inflation.

July 28: Record Container Ship Traffic Jam as Backlog Continues to Build – American Shipper

If you only look at Los Angeles and Long Beach – the largest container import gateway in America – you’d think shipping congestion has drastically dropped. The number of ships waiting there has fallen to 26 from a high of 109 in January. But in fact, North American port congestion has just re-entered record territory. The offshore traffic jam is once again as bad as it’s ever been.

In January and February, when North American congestion previously peaked, there were just under 150 container vessels waiting off the coastlines. Two-thirds were in the Los Angeles/Long Beach queue.

As of July 28, there were 153, the majority off East and Gulf Coast ports. Whereas the earlier West Coast pileup was centralized, highly publicized and relatively easy to track, the current ship queue is more widely dispersed and attracting less attention.

 

 

Air

July 6: Air Canada Bans Pets from Travelling in Cargo Hold Until Mid-September – CBC News

Air Canada has stopped accepting new requests for pets to travel in the baggage compartment of its flights until September 12, as major airports around the country face travel delays, flight cancellations and logistical challenges.

Small animals will still be allowed in the cabins of most flights, provided they can lie down in a carrier under the seat in front of the passenger.

July 22: Airfreight Rates Out of Asia Take a Dive as Demand from the West is ‘Subdued’ – The Loadstar

Asian forwarders are reporting a large drop in airfreight rates, but don’t believe this is the end of elevated prices, nor a significant fall-off in demand.

One Southeast Asian forwarder said: “The demand for airfreight to Europe and the U.S. is looking a bit subdued. However, we note that, this time last year, it wasn’t too strong either. Coupled with the fact that there is substantially more capacity this year, I wouldn’t say demand has dropped drastically.”

 

 

Rail

July 5: CN Update: IBEW Agrees to Binding Arbitration, Ending Strike

The International Brotherhood of Electrical Workers (IBEW), which represents approximately 750 employees in Canada, has agreed to binding arbitration with CN, ending its strike effective 00:01 EDT on July 5.

July 8: Railroad Bottleneck at Busiest U.S. West Coast Ports Reaches Inflection Point – CNBC

60% of all long-dwell containers at the Port of Los Angeles are rail-bound.

Container wait for rail is a little over 8 days for the ports of Los Angeles and Long Beach.

East Coast ports, including the Port of Norfolk, Port of Savannah, and the Port of New York and New Jersey, are seeing more shipping activity as a result.

July 14: Congestion Hits Rail Flows from Canada’s Ports as Boxes Begin to Pile Up – The Loadstar

Rail flows from ports to the Canadian metropolises of Toronto and Montreal are stuck in low gear, with no end of the congestion in sight.

Boxes have piled up at the ports of Vancouver and Prince Rupert, as it takes longer to move them off the docks to urban centres in the east. On July 12, three out of four container facilities at the port of Vancouver (Centerm, Deltaport and Fraser Valley Docks) showed box dwell times in excess of seven days.

For the rail carriers, the port’s website indicated dwell times of more than seven days at three of the four facilities served by Canadian National (CN) and one of the three Canadian Pacific (CP) sites.

This is the result of problems in the interior, notably clogged up rail facilities in the Toronto area and Montreal.

 

 

Trucking

July 2: Port of Vancouver Truckers Poised to Withdraw Service over Environmental Mandate that Forces Some to Buy New Trucks – Vancouver Sun

The United Truckers Association voted on July 1 in favour of job action against a recent Port of Vancouver directive that forbids operators from driving vehicles more than 12 years old.

Gagan Singh, spokesperson for the association, said that 639 of the 1,000 members voted to withdraw service, with no votes against.

Singh said the next step is “to consult with our directors and we will talk to the unions about the (job action) date, should we consider it.” Meetings are planned for July 5.

The truckers are upset about the Rolling Truck Age Program, which is set to begin on September 15 and will impact about 20 percent of the 1,800 trucks that haul containers to and from the ports in a bid to reduce emissions.

The union has said 360 drivers will need to buy a new or lightly used truck, which can cost more than $200,000.

“These costly measures will put extreme financial burden on container truckers amid the highest rates of inflation and unaffordability in a generation,” said Singh.

July 4: Fleets Filling Seats with Flexible Work for Truck Drivers – Today’s Trucking

A bird in the hand is said to be worth two in the bush, but two birds in a bush might be even more valuable if you can get them to work for you. Consider fleets that are realizing the benefits to offering part-time flexible work to drivers who don’t want full-time positions. Two part-timers can be even more productive than one full-timer.

For rookies, one of the toughest aspects of trucking is adjusting to time away from home. Ask any fleet recruiter or driving school and they will agree that a lot of potential candidates wash out within a year because of family pressures related to time away.

As they age, many truck drivers also want to slow down a little, maybe work locally or regionally rather than longhaul. If these drivers can’t find some way to make a job work for them, they head for the door.

July 6: ELD Enforcement Coming January 2023 – Canadian Trucking Alliance press release

There will be no more delays in enforcement of the electronic logging device (ELD) mandate for federally regulated carriers, authorities confirm to the Canadian Trucking Alliance. The mandate will take effect on January 1, 2023.

CTA has been advised by the Canadian Council of Motor Transport Administrators that the provinces and territories are firmly committed to enforcing the ELD mandate in January 2023 and no announcements on further delays are expected. If a particular jurisdiction is not able to enforce the rule in January, all others that are ready will proceed with enforcement at that time.

July 11: Feds Announce New Incentives for Medium- and Heavy-Duty Zero-Emission Vehicles Program – Canadian Trucking Alliance press release

Minister of Transport Omar Alghabra announced on July 11 the Government of Canada will be introducing a medium- and heavy-duty zero-emission vehicles (iMHZEV) incentive program, which will provide approximately 50% of the cost difference between traditional diesel vehicle and a zero-emission alternative to assist trucking fleets in reducing their carbon footprint.

Businesses will have the option to purchase or lease new vehicles under the iMHZEV program, with a maximum of 10 incentives or $1 million available per calendar year. The incentive will be applied at the point-of-sale by the dealership or other authorized sellers such as original equipment manufacturers and/or vehicle finishers/distributors.

July 21: CRA Announces New Initiative Aimed at PSBs and Driver Inc. – Canadian Trucking Alliance press release

The Canada Revenue Agency (CRA) recently released a bulletin outlining efforts to increase oversight on personal services businesses (PSBs) – a technical tax term for what many in the trucking industry believe is used as cover for companies who are engaged in the illicit practices as part of the Driver Inc. scheme.

At its core, the Driver Inc. is a tax evasion practice whereby truck drivers, who would normally be considered employees, are purposefully misclassified – either by choice, force or manipulation – as independent contractors or PSBs through the company they work for. This allows the carrier to avoid paying payroll taxes such as the employer portion for Employment Insurance (EI) while also allowing them to pocket the savings when it comes to paying drivers overtime, vacation pay, paid sick days, etc. It is also often used to shed Workers’ Compensation costs (premiums), which are paid by the employer to cover lost wages for workers who are injured on the job like falling at a workplace or an accident on the road.

In its PSB bulletin, CRA outlines tax implications for PSBs and provides examples of Driver Inc.-type arrangements. In addition to releasing these educational materials, the CRA has announced a targeted enforcement pilot against misclassified PSBs in certain sectors like trucking.

July 27: Canada’s Spot Market Beginning to Normalize: Loadlink – Today’s Trucking

Canada’s spot market saw an influx of capacity amid softening freight demand in June, according to Loadlink Technologies.

The shift signals a return to normalization. Spot market loads fell 23% from record May volumes, but remained 7% higher year over year.

Outbound freight to the U.S. dropped 53% from May, but remained up 21% from last June. Inbound cross-border loads fell 34% from May and were down 6% year over year. Domestic loads dipped 21% from May, but remained 25% stronger year over year.

 

 

CIFFA Advocacy, Communications, Activities

July 8: Letter to CIFFA from Federal Transport Minister

The Honourable Omar Alghabra, Canada’s Minister of Transport, has responded to a letter from CIFFA. He said: “I recognize the important work being advanced by CIFFA and its contribution towards the supply chain efficiency and the vital transportation links between shippers, receivers, and end customers,” and has invited CIFFA to participate in coming sectoral and regional roundtables. 

July 12: CIFFA Membership Survey Results Are In

Twenty-five percent of member companies participated in CIFFA’s recent membership satisfaction survey.

Highlights of the survey are as follows:

July 20: CIFFA’s Canadian Young Logistics Professional of the Year Wins Americas Contest

Congratulations to Karina Daniela Perez Perez, who has won the Americas Region competition in the 2022 Young Logistics Professionals Award competition.

Karina was selected by CIFFA in January as the Canadian Young Logistics Professional of the Year, after a review of her industry experience and a written dissertation demonstrating her technical knowledge.

Next, as the Americas regional winner, Karina will compete at the FIATA World Congress, where she will present her dissertations to the Award Steering Committee that will subsequently announce the global 2022 Young Logistics Professional of the Year.

Karina’s dissertations illustrate the transportation of two key products for the Canadian economy, the challenges that freight forwarders must overcome to successfully deliver goods, and the resiliency of the supply chain with a focus on sustainability.

Karina currently works at DSV Air & Sea in the ocean exports department.

July 20: CIFFA Consults with National Supply Chain Task Force

On July 19, CIFFA’s Executive Director Bruce Rodgers and Director, Policy and Communications Julia Kuzeljevich consulted with the Secretariat to the National Supply Chain Task Force, appointed by the federal government and mandated with the task of producing a report on the state of Canada’s supply chain by end of September 2022.

The National Supply Chain Task Force is chaired by Louise Yako and Jean Gattuso, who were appointed by the Minister of Transport, the Honourable Omar Alghabra, “to lead a task force of diverse industry experts to recommend government and industry actions designed to increase competition, access, resiliency, redundancy, efficiency, and investment in both the domestic and international linkages of our transportation system and supply chains, as well as examine ways to reduce congestion and improve levels of service.”

CIFFA provided input as to member concerns about supply chain fluidity issues, chokepoints, and possible contingencies, short- and longer-term solutions.

CIFFA will also provide a written submission to the Task Force.