Container Shortages in Asia and Pacific Northwest Shippers Face Delays

Port congestion and continued railcar shortages will lead to shipments being delayed for up to two weeks on some trans-Pacific services to Vancouver and Prince Rupert that could last until mid-September.

The rail issues were caused by a 12-day strike by dockworkers at the Port of Montreal in August, which tied up rail cars in eastern Canada, preventing them from being repositioned to the ports in Vancouver and Prince Rupert.

To add to the delays, the ports have been congested from spikes in imports from Asia. According to the Port of Vancouver’s website, July was its busiest month of the year so far, with 303,559 laden and empty TEU handled at Canada’s largest port. That was up from 275,171 TEU in June. [1]

There may be further delays because of a 20 train car derailment near Hope, BC, reported by CN Rail early this morning. [2]

Container Shortages in Asia Expected to get Worse

According to an article by Bill Mongelluzzo, senior editor at the Journal of Commerce, the equipment shortage in Asia is expected to get worse in the coming months. The imbalance in containers is mostly caused by an increase in imports to North America and Europe in the summer, following the reopening of their economies after COVID-19 lockdowns in the spring.

The return of the empty containers in Southern California have been delayed because warehouses have been overwhelmed with import cargo and productivity is lower as workforces adjust to the new safety spacing requirements. To make things worse, logistics companies report a shortage of warehouse workers and truckers due to COVID-19. Ocean carriers are working to alleviate this problem by reducing extended free time for equipment storage that is normally offered.

The logistics challenges in Asia and the US are pushing up the prices of importing cargo to the US. Businesses that are desperate to import products are willing to pay surcharges on top of record-high ocean rates to guarantee equipment and space. Some carriers are declining bookings to India and other Asian locations, desperate to get containers to China. [3]

Canaan Group has long term contracts with all major shipping lines both inbound and outbound.  With over 75 offices worldwide, our local teams work with your vendors and manufacturers to ensure your cargo is expedited.

Contact us if you wanted updated information on your shipments. Clients that have access to the Canaan Group Global Logistics Tracking System (CGGTS) can sign in to view real-time updates on their shipments. 

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Sources:
[1] PNW shippers face delays on Vancouver, Prince Rupert congestion, Journal of Commerce. 
[2] 20 train cars derail near Hope, B.C.: CN Rail, CTV News.
[3] Container shortages in Asia expected to intensify, Journal of Commerce.