MARKET BRIEF | April 2024
East Coast Port a Substitute for Port of Baltimore
Following the March 26 container ship collision with the Francis Scott Key Bridge, which caused its fatal collapse, shippers have searched for an alternative while the Port of Baltimore undergoes recovery. As recently as this past Sunday, a large piece of supporting steel from the bridge was salvaged from the channel. Even though this opens up limited access to the port, it’s not enough a larger flow of vessels. In the interim, the Port of New York and New Jersey has been the main alternative. It’s an obviously viable alternative, as the port is the largest on the East Coast, typically receiving about 72% of the first port of call. However, the Port of Baltimore is the fifth largest gateway in the East, so its full unavailability has caused a good amount of supply chain disruption. But officials are planning to have the port fully reopened to vessel traffic by the end of May.
Boeing Delayed in Delivering Freighters
Last week, Boeing announced they had not yet delivered a 777 freighter in 2024. They do have nearly a dozen freighters currently in production, but are awaiting engines to be fitted. This delay has affected carrier capacity, as strong demand persists. This follows issues, dating back to last year, with the 787 and the 737 Max. Both models have been troubled by production defects.
Increase in Somali Piracy
In addition to the Red Sea Crisis, which has been ongoing since October of last year, another threat to shippers has emerged a short distance down the African coast – an increase of activity from Somali pirates. According to the ICC’s International Maritime Bureau (IMB), there have been 33 recorded incidents. This is an 18.2% increase over the same period in 2023. While this is not a huge jump, it may signal that these pirates are being opportunistic because of the chaos caused by Houthi rebels to the north.
Kuehne+Nagel Makes Organizational Changes
In an April 8 press release, the global logistics giant announced organizational changes, stating that, “The Board of Directors of Kuehne+Nagel International AG has approved a new direct reporting of the country organisations. This change sets the course for further efficiency gains and profitable growth.” The release continues, “By simplifying responsibilities, the new structure will enable Kuehne+Nagel’s business and functional units to sharpen their strategy in line with rapidly changing market developments and implement business decisions even faster. It will also ensure greater global consistency as well as customer proximity.” This is being a considered a “soft reorganization,” with less a 1,000 people potentially affected, which represents only about 1% of their global workforce.
“Ahh, the Freighter!”
In an article published in the Airforwarders Association’s FORWARD Magazine, Aeronet Worldwide’s EVP of International David Gibson recounts the details of an interesting satellite move, via freighter. You can read the article on page 23 HERE …
