1. North American Port Delays
Congestion at Canadian terminals continues to cause delays at the ports of Vancouver and Prince Rupert:
- Vancouver Port: Average delay of 8 days
- Prince Rupert Port: Average delay of 11 days
Several U.S. ports are also experiencing delays:
- Houston: Average delay of 10 days
- Los Angeles/Long Beach: Average delay of 7 days
- Oakland: Average delay of 7 days
- New York/New Jersey: Average delay of 8 days
2. CN and CP Rail Strikes – Latest Developments
The Canadian Industrial Relations Board (CIRB) has ruled that CN Rail and Canadian Pacific Kansas City (CPKC) are not required to maintain services during strikes or lockouts, as railway services are not classified as “essential” under the Canada Labour Code.
Approximately 9,300 workers, represented by the Canadian Trucking Alliance, are now authorized to strike. However, the CIRB has imposed a 13-day cooling-off period, delaying any potential strike action until after August 22.
While the CIRB determined that a work stoppage would not threaten public health and safety, it could have significant economic impacts. Labor Minister Steven MacKinnon has urged both sides to continue negotiations to resolve the problem.
3. Global Port Congestion Worsens, Affecting Supply Chains
Global port congestion is worsening, exacerbated by the ongoing crisis in the Red Sea, leading to severe delays for shippers.
Maersk has issued a warning to state that adverse weather in South Africa and congestion at Freeport in the U.S. will cause extended dwell times for their AMEX service. The Jones Act has further complicated transshipment, leading to additional backlogs.
Meanwhile, Durban, Ningbo-Zhoushan, and Vancouver are among the ports hardest hit by congestion. The supply chain visibility platform Beacon reports a sharp increase in wait times at Southeast Asian ports. North American ports could also face challenges due to potential strikes, emphasizing the need for resilient supply chain strategies.
4. August Sea Freight Rates – What to Expect
Sea freight rates on trans-Pacific routes remain dynamic as volumes surpass last year’s levels.
The extra-loader (XL) capacity injection has alleviated pressure on the U.S. West Coast. However, structural blank sailings caused by rerouting around the Cape of Good Hope (COGH) and congestion at Asian and North American ports have led to delays and capacity challenges, particularly on routes to the U.S. East Coast.
The recovery of Gatun Lake water levels in Panama has eased weight restrictions at the Panama Canal, reducing some pressure. Despite ongoing spot rate reductions along the U.S. coastal regions to balance supply and demand, a General Rate Increase (GRI) is expected in late August. It will intensify discussions around Peak Season Surcharges (PSS) as the gap between FAK and NAC rates remains challenging.
5. Air Freight Rates in August
In the last week of July, global air cargo tonnage stabilized after recent declines but remained down 5% compared to the end of June.
Regional trends showed Central and South America experienced a 4% decline. In contrast, Europe, East/Southern Africa, and South America saw slight growth of 2% and 1%, respectively. Political unrest in Bangladesh caused a sharp 29% drop in European cargo volumes between weeks 28 and 29, followed by a partial rebound of 6% in week 30.
Air freight rates in week 30 saw a slight 1% decrease but remained 13% higher year-over-year. Rates from East/Southern Africa and the Asia-Pacific regions increased significantly.
Notably, rates from Singapore to the U.S. surpassed $9 per kilogram, more than doubling compared to last year. It reflects strong demand and limited capacity in prime areas such as Bangladesh, Sri Lanka, and Dubai.
6. Canadian Customs – EV Tariff Considerations
As Chinese electric vehicle (EV) giant BYD plans to enter Canada, the possibility of imposing tariffs on Chinese EV imports is gaining support from industry leaders, including GM Canada President Kristian Aquilina.
The Canadian government recently concluded consultations on aligning tariff policies with the U.S. and EU to address the growing Chinese EV sector. While tariffs could protect Canada’s domestic EV industry, they may also limit affordable EV options, raising concerns among climate-conscious groups.
It comes at a time when the North American EV market is experiencing volatile growth, underscoring the industry’s need for flexibility.
As a member of Airsupply, we can diversify transportation routes to meet your specific shipment needs and mitigate delays. We also implement advanced supply chain visibility tools, including real-time tracking and predictive analytics, to anticipate disruptions and adjust plans accordingly. Additionally, we keep you informed about potential delays and provide updated delivery timelines.
