Logistics News (January 2021)

Each month we will publish highlights from the important articles we’re reading about shipping and logistics. This month’s articles include a 2021 air freight rates outlook, eBill of Lading standards, limited warehouse space, shipping antique cars, and a Canadian terminal and rail operations update.

Logistics in 2021: Out-of-the-Box Thinking Needed to Survive and Thrive

The pandemic has disrupted the shipping industry. Every shipper has experienced delays, lack of inventory, and increased prices. The prioritization of vaccine transportation this year will only further complicate logistics plans.¹

In 2021 we recommend that our customers diversify their shipping. Instead of booking directly with one carrier, shippers will discover that working with forwarders with worldwide offices like us will give them access to multiple shipping options, allow them to remain flexible and plan proactively this year.

2021 Air Freight Rates will Remain Elevated and Volatile

The air freight rates will remain high and supply limited due to the urgency of COVID-19 vaccine distribution, faster than expected rise in e-commerce demand, continued PPE demand worldwide, and minimal passenger flights due to ongoing lockdowns. Experts expect passenger flights to resume in the second half of 2021 as vaccinations pick up, which will add long-haul international belly capacity and bring capacity relief to cargo.²

eBill of Lading Standards Published

The Digital Container Shipping Association (DSCA) has published a set of standards for submitting shipping instructions and bills of lading electronically. This is the first time all the major shipping lines have agreed to a common format. This is the first publication of a multi-year project. The DSCA is a neutral, non-profit group of nine carriers created to digitize container shipping technology standards. Shippers and forwarders need to adopt this technology into their strategy quickly to remain competitive in the coming years.³

Limited Warehouse Space in Canada

With increased shipping delays, retailers and companies are holding onto more inventory than usual and warehouse logistics space is in high demand. The increase of eCommerce adds to this demand. These changes have created a new type of warehousing nicknamed “warehouse-as-a-service” that provides warehousing space on an on-demand basis, turning what was traditionally a fixed expense into a variable cost.⁴

Transporting Antique Cars

One of the fun projects we have is transporting antique cars. This week we handled the transportation of a 1967 Austin-Healey, a beautiful British sports car. Each week we ship various unique cars to collectors around the world.

Canadian Terminal and Rail Operations Update

All Canadian terminals (Vancouver, Prince Rupert, Montreal, and Halifax) are experiencing heavy congestion due to the spike in import volumes and this is expected to continue until the end of the 1^st quarter of 2021. Weekend labour shortages and high winds continue to impact productivity. Railcar supply is stable but less than normal, further adding to yard and berth congestion. Average rail delays are 10.9 days in Halifax, 8.7 days in Montreal, and 15.4 days in Vancouver.⁵

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Sources:
1. Outlook 2021: Shippers face new twists, risky turns in pandemic-altered market, Journal of Commerce, Jan 4 2021. Accessed Jan 13, 2021.
2. Airfreight rates expected to remain elevated in 2021, Aircargo News, Jan 8 2021. Accessed Jan 13, 2021.
3. Digital Container Shipping Association(DCSA) makes digital documents available, Inside Logistics, Jan 7, 2021. Accessed Jan 13, 2021.
4. E-commerce spike spurs investment in warehousing tech, Journal of Commerce, Dec 1, 2020. Accessed Jan 13, 2021.
5. Regional Updates in North America, Hapag-Lloyd website. Accessed Jan 13, 2021.