Freight and Logistics News and Market Update

Air

• Labor actions have begun as US East and Gulf Coast port workers initiated a strike on October 1. The uncertainty around the duration of the strike has led shippers to consider shifting to air cargo in a market already experiencing a capacity crunch. Each day of the strike could result in 5-10 days of cargo backlog, potentially causing congestion and delays that could last weeks to months, just as air freight enters its peak shipping season.
• As the US East and Gulf Coast Port strike begins, shippers looking to shift their modality to air cargo are likely to have issues finding available capacity. The air cargo market has experienced eight months of double-digit demand growth on the back of the eCommerce boom out of APAC hubs. The strike comes as the busiest time in the air cargo year is beginning, with increased demand for eCommerce shipments before the busy holiday season. The continued imbalance with demand growth outpacing capacity continues to push air freight rates higher with recent rates on APAC-US lanes up +30% Year-over-Year.
• Hurricane Helene impacted the southeastern United States with the largest impacts felt in Florida, Georgia, Tennessee and the Carolinas. Airports across these states canceled hundreds of departures and arrivals as the storm swept through. Beginning October 1, the situation is expected to normalize with significant impacts still seen in certain areas including Asheville, Charlotte and Atlanta.

Ocean

• Dockworkers represented by the International Longshoreman Association (ILA) began a strike impacting all major container ports from Texas up the East Coast. Disagreements between the ILA and the United States Maritime Alliance (USMX) on wages terms and benefits provided to workers are not expected to be resolved shortly, leading to extended delays and disruptions likely to be felt for weeks or months. The Biden administration is not expected to impose the Taft-Hartley act, which could suspend the current labor action and require good faith negotiations between the two sides.

Ground

• ACT Research’s For-Hire Trucking Index reported an increase in volumes along with a decrease in trucking capacity. The data reflects both a rise in goods demand and inventory pre-positioning. Durable goods consumption rose 4.2% quarter over quarter in Q2. Imports, inventories and cross-border shipments are increasing. However, in play in this story are shippers pre-positioning ahead of the US East Coast port strikes.

Air

• Starting October 2024, United Airlines will increase its connectivity between Mexico (Monterrey) and the US (San Francisco). It will be the first airline to offer this direct route with two flights per day. The goal is to provide a better connection between Nuevo Leon and Asia/Australia via San Francisco.
• KLM announced its schedule for the winter season (Oct 27, 2024 – March 30, 2025) offering 155 destinations. This includes 19 destinations from Mexico, daily flights to Argentina, Brazil, Chile and Panama; among other LATAM cities that will benefit from this season’s capacity.

Ocean

• CMA CGM is about to acquire 48% stake in Santos Brazil, a leading terminal operator in Brazil, whose largest asset is the terminal Tecon Santos in Sao Paulo. The move will strengthen CMA CGM’s position in Brazil.

Air

• The air cargo peak season is poised to kick off. Demand has continued to build throughout 2024 due to ongoing eCommerce volume from many APAC hubs, and capacity continues to lag, leading to increases in rates on most major lanes out of the region. Additional impacts are expected to be felt as the Golden Week holiday will impact China in the coming weeks, closing factories across the country in observation.
• Meta will expand its investment in Vietnam for artificial intelligence (AI) innovation to increase its footprint in the country. This involves expanding the production of its latest Mixed Reality device Quest 3S in Vietnam beginning in 2025.
• Hong Kong-based Cathay Pacific has announced they are expanding their US footprint with a new non-stop route between their Hong Kong hub and Dallas-Fort Worth. The new destination will bring the total destinations served in North America to eight, the sixth in the US. Their current operation includes 88 weekly flights to North America, with US routes to Boston, Chicago, LA, New York and San Francisco.

Ocean

• ST Engineering opens a ‘smart yard’, known as Gul Yard, to replace its Tuas Yard at year-end in Singapore. Gul Yard will be double the size of Tuas Yard and equipped with technology to support operation, workplace safety and eco-friendly practices. Furthermore, the size expansion allows Gul Yard to handle larger and more complex projects with shorter turnaround times and greater efficiency.

Air

• Schiphol Airport's cargo community is testing a new Secure Import system aimed at reducing crime and improving cargo processing. The system combines a digital platform with a new framework for import carriers and forwarders. It limits access to sensitive information, enhances security and improves process control. The system will be tested throughout the month, and, if successful, implemented at the airport. Secure Import was developed in response to rising criminal activities in air cargo transport, ensuring secure and efficient handling.
• IAG Cargo is adding additional capacity into the Asia Pacific region in hopes of capitalizing on the increasing demand and rates from eCommerce shippers on the APAC-Europe trade lanes. Additional flights have been added to Thailand, Malaysia and Japan. IAG looks to provide services to the automotive and high-tech industries in addition to the flood of eCommerce volume.

Air

• Qatar Airways Cargo announced a new suite of products for temperature-controlled shipments which are Q-Climate, Q-Plus and Q-Prime respectively. Q-Climate solution offers temperature-control for general cargo and vulnerable cargo. Q-Plus provides prioritizes capacity for time-sensitive shipments handling on confirmed flights or the next available flight. Q-Prime provides a guarantee for urgent shipments requiring uplift with prioritized processing and a money-back guarantee if the shipment is not confirmed.
• Etihad Cargo and SF Airlines have announced their partnership expansion to provide an integrated logistics solution to airline customers. The new partnership will offer customers increased aircraft capacity, reduced transit times and seamless interconnected networks between two airlines. This will also enhance the frequency of flights served between several destinations.
• WorldACD Market Data indicates that global air cargo tonnage has witnessed a -3% decrease between September 16 to September 22. The seasonal decrease in tonnage in September is attributed to an increase in rates from Middle East and Asia origin regions. The rate increase is also due to e-commerce companies and rising geo-political tensions in the Middle East.

Ocean

• Hapag Lloyd, a leading German container line, has announced a general rate increase (GRI) for shipments from Indian subcontinent and Middle East to the US East Coast and Gulf Coast. A GRI of $1,000 USD will be applicable for shipments transported using 20’, 40’ dry, reefer, special containers and HC containers. Ocean carriers have begun to implement GRIs due to peak season factors, resulting in port congestions and delays in procuring containers.
• India has announced a major logistics infrastructure network project to efficiently connect the new transshipment port. The logistics project will spread across 600 acres across the Vizhinjam location and will boost connectivity to the transshipment port. The state government additionally approved a recent logistics park policy for land acquisition.

Ground

• Emirates Logistics has announced the partnership with Freterium, a global software solutions provider, to develop and integrate digital transport management platform into its operations to focus on optimizing and transforming transport operations across the Gulf Cooperation Council (GCC), Africa and Asia regions.
• Aramex and Rand McNally have partnered together to provide advanced telematics software hardware required for Aramex and a new telematics-oriented digital platform. The new software platform will cater to the Middle East and North Africa (MENA) region. The partnership will also focus on optimizing vehicle performance, reducing fuel costs and monitoring driver’s behavior.

• On September 25, the Canadian government’s Standing Committee on International Trade (CIIT) proposed delaying the rollout of the CBSA's Assessment and Revenue Management (CARM) system to April 2025, highlighting ongoing concerns from the trade community about its readiness for a planned launch on October 21. During the hearing, industry representatives—including Kim Campbell from the Canadian Association of Importers and Exporters, Renate Jalbert from Federal Express Canada, and Tammy Bilodeau from UPS Canada—expressed that importers and exporters are not adequately prepared for the system’s implementation within the next three weeks.
• Local 375 of the Canadian Union of Public Employees (CUPE) announced a strike at two cargo terminals in the Port of Montreal, beginning September 30 at 7 a.m. ET and lasting until 6:50 a.m. ET on Thursday. This strike will affect the Termont Montréal terminals. To prepare, ceased accepting railed export traffic to the Termont and VIAU terminals from September 29 to October 1. CUPE has expressed frustration over the lack of progress in negotiating a collective agreement with the Maritime Employers’ Association (MEA) since the beginning of the year.