Last week, President Joe Biden announced that the Ports of Los Angeles and Long Beach would both be operating 24/7 to ease supply chain bottlenecks. These ports handle 40% of shipping containers imported to the United States. During off peak hours, cargo leaves the port 25 percent faster. The president received commitments from major retailers Walmart, FedEx, UPS, Target, Home Depot, and Samsung to ramp up activities to utilize off-peak hours at ports.¹

While the workplace can be a substantial source of stress on workers, research has found that how work is designed can have a significant impact on employee well-being, leading to improved job performance, lower health care expenses, and lower burnout rates.

As Black Friday and Christmas approach, desperate shippers have been paying up to $2 million for a trans-Pacific chartered flight. In pre-pandemic 2019 peak season, it would cost between $400,000 to $700,000.¹

The holiday season is looking bleak for some shippers. Already dealing with high shipping costs and lack of capacity, some companies will feel the impact of Asian port closures from tropical cyclone Kompasu and the lockdown in Vietnam.

During the last weekend of August, there was a record 47 container vessels waiting outside the ports of Los Angeles North American shippers will see some relief once the busy 2021 holiday season ends, but not as much as past years. 2022 will see consumer spending drop, especially as government rent relief and fiscal stimulus are reduced or removed. But retailers and manufacturers will be working on replenishing record-low inventory levels back to normal. While transportation capacity is expected to be more readily available in 2022, there will be enough freight demand to keep prices higher than past years.¹

Worldwide e-commerce sales have grown six times in the last decade, from $572 billion in 2010 to $3.5 trillion at the end of 2019. This trend has only been accelerated by the COVID-19 pandemic. With more people relying on e-commerce for their daily needs, last-mile delivery systems are becoming the bottleneck, especially with increasing delivery traffic and shrinking labour availability.

During the last weekend of August, there was a record 47 container vessels waiting outside the ports of Los Angeles and Long Beach.¹ When ships are anchored offshore waiting for an available berth, they miss subsequent departure dates. This leads to cancelled sailings, reduction in much-needed capacity, and slowdown of container and chassis circulation, which adds to the upward pressure on already record-high rates.²

In China, Meishan Terminal in Ningbo port has reopened, following a Covid-related shutdown in August. Please be aware of office closures in China for the upcoming holidays of Mid-Autumn festival (Sept 19-21) and National Day Golden Week (October 1-7).

Starting October, the Port of Halifax will receive the first direct call between India’s west coast and a Canadian port. The MSC Indus 2 Service will have a port rotation of Mundra – Nhava Sheva – Gioia Tauro – Sines – Halifax – Norfolk – Baltimore – Miami – Freeport – Mundra.

With the arrival of the fall season, many companies are facing new challenges particularly in response to and impacted by the pandemic. In a recent podcast by McKinsey and Company, Senior Partner Celia Huber discusses industry shifts with Global Managing Partner, Kevin Sneader. According to Sneader, there are “The eight trends that will define 2021 – and beyond.” Today we will share about these trends, as well as examine how they might impact your business as it relates to shipping.

While leisure air travel has increased this year, business travel has faced a much slower return. Many offices remain closed, employees are reluctant to travel, and conferences and trade shows stay mostly virtual. These conditions will change, as business leaders still believe face to face interaction is valuable. Deloitte estimates that by the end of 2022, corporations will be spending 65-80% of their 2019 travel budget.¹

China has partially shut down the world’s third-busiest container port after a worker tested positive with Covid-19. This threatens to disrupt global transportation as peak season nears.

At the beginning of 2021, 9 months into the pandemic, McKinsey published an article outlining trends that will define 2021. One of these trends was the movement from the popular management philosophy of Just in Time (JIT) towards what they called Just in Time Plus (JIT+). Now that we are two-thirds the way through 2021, we are seeing how accurate McKinsey’s prediction was and how many of our clients are moving in this direction.

If you’re sick of hearing about Long Beach (LGB) & Los Angeles (LAX) port congestion, we’ve got bad news for you. Expect congestion to get worse. Imports from Asia are not showing any signs of slowing down, and will only increase with peak season approaching. The Purchasing Managers’ Index (PMI) reached an all time high of 63.4 in July. The Southern California ports are expecting 10% growth in container volumes this year, and many are calling for 24-hour shifts to support the growth.

Late last Friday, Canada’s border agents reached a new tentative agreement with the Canadian government. The deal came after 36 straight hours of negotiations. There was immense pressure to get a deal done, after a daylong work-to-rule campaign by CBSA workers left long lines at international gateways. Because 90% of CBSA workers are deemed essential, they are not legally allowed to strike, but what they did was follow procedures to the letter, which slowed down operations immensely. Reported commercial wait times in Surrey, BC, reached 5 hours by Friday afternoon.

Due to an increase in e-commerce clients, our Toronto office has relocated to a brand-new warehouse space this month. This new location has more space to provide pick and pack services, transloading, storage, and other services to facilitate the growth of our Canadian warehousing services.

Yesterday, July 28, 2021, it was announced that the 9,000 Canadian Border Service Agency (CBSA) workers voted in favour of a strike. This means that the workers are in a legal strike position as early as next week, because of an impasse in negotiations between their union and the Government of Canada.

Each month we will publish highlights from the important articles we’re reading about shipping and logistics. This month’s articles include forest fires impacting B.C. terminals, lockdowns in Southeast Asia, and reasons for the current high demand for ocean and air freight.

We recently read an excellent article on change management in the Harvard Business Review, with the title “How Good is Your Company at Change? A new system for measuring (and improving) your ability to adapt“. In this article, we share highlights of what we learned and how we are trying to apply these lessons at Canaan Group.

The CP rail line that was shut down because of the B.C. interior wildfires is now operational. The backlog of trains is now being processed.