MARKET BRIEF | September 2023
TPEB Updates
The West Coast’s share of Asia imports has dropped from 71% in 2013 all the way down to 56% in 2023. The Trans Pacific East Bound OTI was 65 days, down 42% from the peak of 113 days in January 2022. However, it is still 40% above the 2019 average of 46.4 days. Despite West Coast ports endeavoring to rebound, there have been delays in processing vessels at terminals within the Port of Los Angeles and the Port of Long Beach. The average delay for late vessel arrivals may have increased by 0.04 days month-on-month, reaching 4.39 days in May 2023, but the delay times have improved over what they were during the pandemic/lockdown era.
Rates Fall, Blank Sailings Rise Leading Up to Golden Week
Ocean freight rates and vessel capacity in the Trans Pacific are sinking amid a widening cargo drought during what is typically a peak shipping season for U.S. importers prior to China’s Golden Week holiday (October 1-7). The downward spiral in import demand will most likely continue until shippers start ramping up orders again ahead of the Chinese New Year in February. The falling rates in the first two weeks of September have also resulted in ocean carriers sharply ramping up blank sailings for October. This comes after an easing back on blank sailings for September, but that was in anticipation of better demand.
More West Coast Labor Issues
West Coast ports continue to run into several supply chain issues amid ongoing labor problems. The latest is that Union Pacific has announced a temporary pause of all inland rail ramps to the ports of Los Angeles and Long Beach. This move is meant to be a proactive measure to alleviate port congestion. However, the Port of Los Angeles is the nation’s busiest port – processing $440 billion in cargo value per year – and is a significant shipping point for the U.S. agriculture industry, so that is cause for concern. Additionally, negotiations continue between the ILWU (International Longshore and Warehouse Union) and the Pacific Maritime Association, with wages being the main topic of conversation. Some of the friction between the two organizations has recently resulted in worker job actions demonstrated at ports ranging from Oakland, Los Angeles, and Seattle.
Digital Twins Unlocking Efficiency and Precision in Warehousing
In the ever-evolving landscape of industry and technology, the concept of “digital twins” has emerged as a transformative force, particularly in the warehousing sector. This innovative approach bridges the physical and digital realms, enabling companies to enhance operations, optimize resources, and stay competitive in the digital age. Let’s delve into the concept of digital twins … READ MORE
Warehouse Security Best Practices
Warehouses serve as critical hubs in the supply chain, storing valuable goods and materials. Ensuring the security of these facilities is paramount to maintaining smooth operations, protecting assets, and ensuring the safety of personnel. Let’s delve into the best practices for warehouse security … READ MORE
The Power of Data Analytics in Supply Chain Management
In the fast-paced world of modern business, supply chain management has evolved from being a logistical function into a strategic powerhouse. One of the driving forces behind this transformation is the widespread adoption of data analytics. Let’s explore how data analytics is used in supply chain management … READ MORE
Exploring the Array of Final Mile Services in Logistics
In the complex world of logistics, the last mile of delivery is often the most intricate and crucial phase of the journey. The term “last mile” refers to the final leg of a product’s journey from the distribution center to its ultimate destination, whether it be a residence or a business. This stage presents a unique set of challenges and opportunities, prompting the development of various final mile services that cater to diverse customer demands. Let’s delve into the different types of final mile services in logistics … READ MORE
