Month in Review – July 2023

Canada’s West Coast Port Strike

July 4: B.C. Ports Strike Could Inflict Damage That Takes Months to Correct, Warns CN – Strathroy Age Dispatch

CN says the ongoing workers’ strike at ports in British Columbia could increase costs and inflict economic damage that could take months to correct.

“A labour disruption can create significant impacts on shippers’ decisions to use Canada’s ports,” spokesperson Jonathan Abecassis said in a statement. “Given the integrated nature of ports and rail corridors, a work stoppage can create disruptions that take weeks or even months to correct.”

He urged the parties to come to an agreement and added that CN Rail encourages the federal government to “remain engaged and prepared to act to end the labour disruption.”

July 13: BCMEA, ILWU Reach Tentative Agreement – BCMEA press release

A tentative agreement has been reached between the BCMEA and ILWU Canada, with operations to resume as soon as possible.

The British Columbia Maritime Employers Association (BCMEA) and International Longshore and Warehouse Union (ILWU) Canada officially advised that the parties have reached a tentative agreement on a new four-year deal “that recognizes the skills and efforts of B.C.’s waterfront workforce.”

The tentative agreement is subject to ratification by both parties and, consequently, details of the agreement have not been released.

July 18: ILWU Leadership Rejects Mediator’s Tentative Deal Without a Member Vote – BCMEA press release

ILWU Canada’s internal caucus leadership rejected the tentative agreement before it was taken to a vote of the full union membership. The union communicated that it would re-engage in strike activity on July 18.

July 19: Canada Industrial Relations Board Ruling – Illegal Strike Action Declared – BCMEA press release

The Canada Industrial Relations Board (CIRB) ruled that the union was in violation of the Canada Labour Code by not providing 72 hours notice to BCMEA, and has ordered the union to cease and desist its illegal strike action effective immediately.

July 19: ILWU Canada Removes 72-Hour Strike Notice – BCMEA press release

ILWU Canada communicated that, effective immediately, the 72-hour strike notice issued for July 22 at 09:00 has now been removed.

July 21: Tentative Deal to Go to ILWU Membership for Ratification Vote Week of July 24 – BCMEA press release

The BCMEA has received communication from ILWU Canada that the ILWU Longshore Caucus approved and will recommend to their membership the Terms of Settlement that was proposed by the senior federal mediator and ratified by the BCMEA on July 13.

The tentative deal will be sent for a ratification vote by the ILWU voting membership, expected late in the week of July 24, with results anticipated shortly thereafter.

July 28: ILWU Canada votes down tentative agreement – BCMEA press release

The ILWU Canada voting membership rejected the four-year tentative agreement that was proposed by the senior federal mediator and recommended for ratification by the ILWU Bargaining Committee and their Longshore Caucus.

July 29: Minister of Labour Refers B.C. Dispute to the Canada Industrial Relations Board – BCMEA press release

On July 29, the Minister of Labour announced use of his authority under section 107 of the Canada Labour Code to “preserve industrial peace” and has formally directed the matter to the Canada Industrial Relations Board (CIRB).

The Minister has directed the CIRB to determine whether the union’s rejection of the tentative agreement has eliminated the possibility of a negotiated resolution. If the Board determines that to be the case, the Minister has directed it to either impose a new collective agreement on the parties or impose final binding arbitration to resolve outstanding terms of the collective agreement.

July 30: ILWU Canada, BCMEA Reach Negotiated Collective Agreement – joint ILWU Canada, BCMEA press release

ILWU Canada and BCMEA have concluded a negotiated collective agreement with the assistance of the Canada Industrial Relations Board. The parties are recommending ratification of the collective agreement to the union’s membership and member employers, respectively.

Other Maritime News

July 6: Ships Leaving Chittagong Half Empty due to Factory Closures – The Loadstar

With Bangladeshi factories remaining shut throughout the week, due to Eid-ul-Azha holidays, vessels are having to leave Chittagong port half empty owing to a lack of cargo. The factories closed on June 26, and will reopen this weekend.

But shipping executives said ships will not be fully laden until the end of next week, with factories requiring three to four days to produce goods.

July 6: IMO Agrees to Nonbinding Target to Achieve Net Zero “Around 2050” – The Maritime Executive

IMO member states have reached a tentative deal on the thorny question of bringing shipping into line with the Paris Agreement. The newly agreed MEPC climate roadmap calls for reaching net-zero emissions “by or around, i.e. close to, 2050.”

IMO and the shipping industry negotiated an exception from the landmark 2016 climate agreement, on condition that emissions would be regulated by the IMO. Along with aviation, shipping is one of only two sectors in the world not subject to national-level Paris pledges. The nature of the IMO’s climate regulation has been a matter of constant debate over the intervening nine years. The deal announced on July 6 begins to resolve that question, and it includes elements of proposals from NGOs, developing nations and climate action opponents – like China, which has pushed for greater flexibility on the target date and less ambitious emissions policies.

The specific targets in the agreement include a 20 percent cut in emissions by 2030 and a much deeper 70 percent cut by 2040 (relative to 2008 levels). The first goalpost would be broadly achievable with proven interventions like slow steaming, just-in-time arrival, technical efficiency upgrades and add-ons like rotor sails. The 2040 target would require deeper changes to shipping’s fuel supply.

July 10: D&D Charges in Freefall as Carriers Vie to Keep Shippers Onboard – The Loadstar

Detention and demurrage (D&D) charges have plummeted over the past 12 months, as carriers try to keep hold of their shippers in a slackening market.

Container xChange’s annual D&D survey found that, across 65 international gateways, average D&D charges fell 25% year on year, and were below pre-pandemic levels for the first time in three years.

July 24: Trans-Pacific Shipping Rates Rise as Carriers Make Capacity Cuts – American Shipper

Shipping lines finally seem to be making some headway in managing vessel capacity in the Asia-U.S. trades.

Spot rates have been on the rise for three straight weeks, rebounding to levels last seen in early 2023 and late 2022, according to several index providers. U.S. import bookings remain above pre-COVID levels, and multiple analysts are now highlighting increasing rates from reduced vessel capacity.

Air

July 7: Minister of Transport Announces Funding to Increase Supply Chain Capacity at Toronto Pearson International Airport – Transport Canada press release

Minister of Transport Omar Alghabra announced an investment of nearly $94 million under the National Trade Corridors Fund for a cargo development project at Toronto Pearson International Airport.

The project will improve cargo capacity by building two new facilities: the South Cargo Transfer Development Facility (YYZ South) and the North Cargo Apron Development (YYZ North). YYZ South will increase capacity for incoming cargo, and YYZ North will build additional infrastructure for more cargo aircraft parking spaces, which will also increase cargo capacity.

July 10: IATA CASSLink Information and Next Steps for Wave 3 Go-Live

IATA has announced that the new CASSLink platform is scheduled to go live for Wave 3 markets, including Canada, on October 3. A detailed schedule will be made available in the coming months.

A migration checklist will help users prepare during this transition. More information on the changes to the new CASSLink can also be found here.

The system will be open for user setup starting on September 11. Your company CASSLink administrator must set up your users prior to the go-live date in order to continue operations in the new CASSLink. Find more information here.

July 17: Price War Keeps Air Cargo Rates Below Natural Level – American Shipper

Amid a burgeoning price war, pessimism is growing in air cargo circles that a market in prolonged recession could drift further downward, after a short pause, reducing the chance of a modest recovery during the traditional preholiday shipping rush.

Logistics professionals had hoped for an upturn by now that would steadily build into the second half, but that hasn’t happened. Freight forwarders and, increasingly, cargo airlines have responded by chasing volumes without regard to cost, which observers say is accelerating a decline in rates.

Aggressive price discounting, and reports that some carriers are shelving older aircraft, suggests companies are increasingly nervous that demand won’t improve this year in a world with excess capacity. In fact, freight rates are lower than supply and demand fundamentals actually support because freight forwarders and carriers, eager to generate some cash from committed airlift, are undercutting each other on price to keep bookings and steal business, transportation managers and analysts say.

July 25: Flight Delays at Canadian Airlines Far Outstrip Peers in U.S., Despite Improvements – BNN Bloomberg

Canada’s two biggest airlines have seen a far higher proportion of their flights delayed this summer than many of their American peers, according to figures from an aviation data firm.

Overall, only half of Air Canada’s 31,168 flights were on time between June 19 and July 16, statistics provided by Cirium reveal.

In comparison, 64 percent of WestJet’s 14,998 flights touched down late.

Flights are considered on time if they reach the airport within 15 minutes of their scheduled arrival time.

The numbers contrast with on-time performances that range between 68 percent and 83 percent for the five biggest airlines in the United States.

Rail

July 23: CN Customer News: Eastern Washouts

CN advises that heavy rainfall in Nova Scotia has resulted in delays across the Atlantic region. Damages from the rainstorm on the railway’s Bedford and Dartmouth subdivisions are impacting service to/from the Port of Halifax.

Once the rain event has passed, CN’s focus will be to enable crews to clean any debris, assess any damages and prepare for any repairs that may be required.

July 26: Tariff Update – CN 9100, Effective August 25

CN has announced updates to its Tariff 9100 (Intermodal) effective August 25.

A major change will be put in place on that date to Item 6500 – Storage of dry and reefer steamship units–loads. Storage free time and chargeable start time will change from 00:01 to 07:00.

July 27: Rail Freight from Canada to U.S. Continues to Drop After Ports Strike – CNBC

Rail traffic from Canada into the U.S. had a third-straight weekly drop as a result of the on-again, off-again strike at the West Coast Canadian ports.

The vessel and container gridlock is raising concerns for chemical companies who have critical materials stuck as a result, creating supply chain issues.

Total rail volume from Canada to the U.S. was down 12%, according to the Association of American Railroad’s latest rail traffic report for the week ending July 22. This was an improvement, given the first full week of the strike saw a 46% decrease in rail trade from Canada, and the second week suffered a 36% decrease.

July 28: B.C. Port Strike Cost Canadian Pacific’s Newly Amalgamated Railway $80 Milllion, Exec Says – CBC News

The B.C. port workers’ strike deprived Canadian Pacific Kansas City Ltd. of scores of millions of dollars, its chief marketing officer said, tacking on a costly coda to a tough quarter.

“At this point, we’re estimating the strike had a negative impact of about $80 million in revenue, much of which we will work hard to claw back over the remainder of Q3 and Q4,” John Brooks told analysts.

The 13-day strike – plus a brief wildcat job action – earlier this month halted operations at most ports along the West Coast. In the first week alone, it depressed the number of containers hauled by Canadian railways to barely half the level reached during the same period in 2022, according to the American Railroad Association.

July 30: CN Update Regarding Eastern Washouts

CN reported that its service on the Bedford Subdivision near Truro, Nova Scotia, was restored on July 27 after heavy rains affected rail lines for several days in the area.

Trucking

July 7: New Federal Fines for Hours of Service, ELDs Range from $300 to $2,000 – Today’s Trucking

Truck drivers and carriers face 60 new federal fines for hours-of-service violations – including those specific to mandated electronic logging devices (ELDs).

Coming in three tiers, the fines range from $300 to $1,000 for drivers, and $600 to $2,000 for motor carriers.

The lowest tier includes administrative and minor recordkeeping contraventions. A second tier includes on-duty/drive limitations; off-duty requirements; more serious recordkeeping contraventions that increase risk; and contraventions that make it difficult to enforce carrier compliance.

Topping the scales are fines for tampering, falsifying or obstructing records, and the most serious on-duty/driving limitations and rest requirements.

July 13: Canada’s Share of Women Truckers Lags Totals in North American Survey – Today’s Trucking

A Women in Trucking (WIT) survey has concluded that women account for nearly 12.1% of North America’s professional drivers, but preliminary 2021 Census data suggests Canadian-specific totals are actually far less than that.

Women now hold 16.4% of Canadian jobs in trucking, logistics and warehousing – up from 15% in 2015 – but account for just over 4% of Canada’s truck drivers, according to the Census results.

While the increase in the overall share of women may seem relatively small, Trucking HR Canada chief program officer Craig Faucette says the preliminary results might underestimate current totals. The 2021 Census data was conducted in the middle of the pandemic when many women left the industry to take care of their families, he explains.

July 18: ‘Nuclear’ Lawsuits Against Truckers Continue to Rise in U.S. – Transport Topics

A new study by the U.S. Chamber of Commerce Institute for Legal Reform found that trucking in America is “under siege by litigation.”

“Verdicts in trucking accident cases accelerated in size starting in the 2000s but have skyrocketed over the last 10 years, despite a decreased rate of serious trucking crashes over that time frame,” the study said. “Moreover, with the inflation of verdicts and settlements, the search for deep pockets is expanding and the circle of potential defendants is widening.” A review of 154 trucking litigation verdicts and settlements from June 2020 to April 2023 revealed a statistical mean plaintiffs’ award of $27.5 million and a statistical median award of $759,875 for settlements.

July 19: U.S. Court Enters Huge Win for Freight Brokerage Industry – FreightWaves

The freight brokerage industry began humming Meat Loaf’s 1977 power ballad “Two Out of Three Ain’t Bad” Tuesday when the U.S. Court of Appeals for the 7th Circuit became the third federal appellate court to consider the extent to which negligence claims against freight brokers are preempted by federal law.

While the decision governs only federal courts in Illinois, Indiana and Wisconsin, it naturally provides highly persuasive authority for courts elsewhere across the country.

July 26: B.C. to Commence ELD Enforcement August 1 – Today’s Trucking

The B.C. Ministry of Transportation and Infrastructure said that, as of August 1, enforcement officers in the province may issue violation tickets to carriers who fail to equip a commercial motor vehicle with a certified electronic logging device (ELD).

The fine amount is $520, which results in a ticketed amount of $598 when the victim surcharge is included, said the ministry.

Recently, the federal government imposed 60 new fines on truck drivers and carriers for hours-of-service violations – including those specific to mandated ELDs.

July 27: Strategic Tactics Drive Cargo Theft Rise – Transport Topics

The trucking industry has faced an increase in cargo thefts this year, with thieves developing more sophisticated and strategic tactics.

Verisk Analytics’ CargoNet in a second-quarter report released July 18 found that “supply chain risk events” increased 57% year-over-year, with 582 reported incidents across North America. This accounted for over $44 million in stolen shipments.

The report noted that much of the increase was attributable to a type of strategic approach known as shipment misdirection attacks.

“We have clever criminals here, but it’s become more of a global problem in regard to the organized crime piece,” said Keith Lewis, vice president of operations at CargoNet. “When they steal by fraud, use the internet and use surrogates to do their dirty work that don’t know they’re involved in a crime, they can do it so much easier and so much faster. And now they can target and hit, with a bull’s-eye, high-value commodities.”

CIFFA Advocacy, Communications, Activities

July 11: CIFFA Launches International Education Brand: TraversEd – CIFFA press release

CIFFA has officially launched TraversEd, its new educational arm designed to meet the needs of freight forwarding organizations and learners outside of Canada.

TraversEd builds on CIFFA’s 40-year legacy of successfully educating Canadians in freight forwarding and logistics, and aims to extend this expertise to a global audience.

Currently, CIFFA delivers training to over 300 freight forwarding member firms and partners with colleges across Canada, registering 10,000 students annually for the CIFFA Certificate in international freight forwarding.

TraversEd offers flexible, customized world-class education and certification through two distinct delivery methods:

• Online and On Demand – in partnership with international corporations and global freight associations/networks
• Instructor-Led – in partnership with a university or college

Many international business, supply chain and global logistics programs do not cover specific competencies required to fulfil the complicated role of an international freight forwarder.

TraversEd will ensure that students receive specific education on the competencies sought after by employers.

CIFFA members with international offices can now benefit from the same great training offered by CIFFA through TraversEd. Additional savings will be provided to freight forwarding companies outside of Canada who are linked to members in Canada.

July 27: CIFFA’s Canadian Young Logistics Professional of the Year Wins Americas Contest – CIFFA press release

Congratulations to Viktoriia Rudyk, who has won the Americas Region competition in the 2023 Young Logistics Professionals Award competition.

Viktoriia 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, Viktoriia will compete at the FIATA World Congress, where she will present her dissertations to the Award Steering Committee that will subsequently announce the 2023 Young Logistics Professional of the Year.