US trade groups increase pressure on Biden administration, as ILA-USMX talks stall

Lucas Lee Featured, News, Uncategorized

As posted here in April, the threat of the first strike along the US East and Gulf Coasts since 1997 still exists as negotiations continue between the International Longshoremen’s Association (ILA) and carriers. With the expiry of the current contract now just three months away, efforts to reach a new agreement have stalled. The Biden administration has been petitioned by around 160 state and federal trade associations, representing manufacturers, retailers, farmers, among other businesses, to bring the parties back to the table.

The current contract is set to expire on September 30, with the ILA already indicating, last November, that union members would not work beyond that date should there be no agreement on a new deal.

“One of the key priorities for the administration has been supply chain resiliency and addressing ongoing supply chain challenges,” the letter from the trade associations stated. “We continue to see maritime supply chain challenges from the ongoing Houthi attacks on vessels transiting the Red Sea. This has led to other supply chain issues: congestion and lack of equipment at overseas ports, carrier capacity issues as they continue to divert vessels away from the Red Sea, and increased freight rates. With all these existing challenges, the last thing the supply chain, companies and employees—all of which rely on the movement of goods, both imports and exports, through our East Coast and Gulf Coast ports—need is a strike or other disruptions because of an ongoing labor negotiation. As this administration has seen, even the threat of a strike or disruption can have a negative impact on the supply chain.”

The Biden administration played a key role in negotiations with the International Longshore and Warehouse Union (ILWU) in 2023. Amid a highly-charged competition for the White House in 2024, electoral politics could have an out-sized role in how the Biden administration engages the dispute.

With transit time for shipments from Asia to the East Coast at 60 days, decisions to divert shipments to avoid a possible strike would have to be made before July 15. Please contact sales@canangroup.ca to get support on how best to plan for potential disruptions caused by work stoppages.

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Surging Demand and Rising Costs Up Ahead

Rowena Lo Events, Featured, News

Canaan Group has been monitoring Asia/North America and Asia/Europe trade conditions resembling those during the pandemic’s peak. While demand surges between 10-20% year-on-year across the entire customer base, certain unique factors have arisen that have reduced sailing capacity, equipment availability, and increased prices specifically for shipments coming out of Asia.

Among the major factors driving increased rates are the Houthi rebel attacks at the Red Sea which incentivize cargo vessels to avoid the Suez Canal and instead, navigate around the tip of Africa at the Cape of Good Hope. The diversion lengthens voyage times by no less than a week and creates imbalanced and unexpected concentrations of container equipment around the globe thereby creating a shortage of available equipment.  China is now in an equipment deficit situation.

The month of May has traditionally been a peak season with expected peak season surcharges and GRIs but with the sustained capacity demand and blank sailing programs, and the short-term outlook for the full year is bleak. FAK and spot facilities for most shipping lines remain closed until June or later causing booking challenges for customers who are willing to pay the escalated rates quotes by carriers. Despite the desire to pay-to-play of many importers, carriers are retracting rates shortly after issuance and replacing them with higher levels.

With carriers increasingly being required to adhere to various carbon taxes and emissions trading systems (ETS) imposed on from various nations, the expensive and prohibitive shipping situation is not expected to improve until Chinese Golden Week in October.

For more information on shifting global trade patterns and logistics strategies, please contact your sales team at sales@canaangroup.ca

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Canadian Border Services Workers Vote to Strike

Rowena Lo Uncategorized

The Border Services (FB) bargaining unit, represented by the Public Service Alliance of Canada (PSAC) and the Customs and Immigration Union (CIU), has voted in favor of a strike and legally could strike as early as June 6th. Despite this, 90% of frontline Border Services Officers, deemed essential workers, will continue their duties, ensuring the border remains open and safe. The CBSA is prepared to handle potential disruptions, though the potential strike by the Border Services (FB) bargaining unit could cause significant delays in customs clearance for both ocean and air cargo, leading to congestion at ports and airports.

This may result in longer turnaround times, disrupted schedules, and increased operational costs. Businesses should prepare for potential delays by enhancing communication with logistics partners and implementing contingency plans to maintain supply chain continuity.

For more information during the disruptions, contact the Canaan Group sales team at sales@canaangroup.ca.

Rail strike update: Work stoppage possibility on hold as CIRB reviews implications for essential goods

Rowena Lo Featured, News, Uncategorized

The Canada Industrial Relations Board (CIRB) has been asked to review the implications for essential commodities of a potential strike among unionized railway workers. A work stoppage could have started as early as May 22, but the CIRB process delays the earliest starting date to July 15 and creates new uncertainties around disruptions to both freight traffic and commuter services. 

A work stoppage can only begin following a decision from the board and 72 hours notice from the union. 

The Canadian Pacific Kansas City (CPKC) offered to enter binding arbitration with the union, the Teamsters Canada Rail Conference (TCRC), to avoid a strike, but the union declined. CPKC has also suggested that an agreement be reached with the TCRC about which services should be maintained during work stoppage.

“We believe this would eliminate the need for the CIRB referral process and bring much needed clarity regarding the timing of any potential strike or lockout,” the railway said. “If no maintenance of services agreement is reached, based on precedent, it is unlikely the parties will be in a position to initiate a legal strike or lockout within the next 60 days.”

The CPKC and TCRC will resume meeting on May 17, 2024, in an attempt to move negotiations forward. At issue is the proposal of the railways (CPKC and Canada National) to shift train crews from the traditional mileage-based pay to hourly pay.

Please contact us at sales@canangroup.ca to explore how we can minimize disruption to your operations through the uncertainty of these negotiations.


With possibility of strike beginning May 22, railways, union workers, shipping companies, and Canadian government considering all options

Rowena Lo Featured, News, Uncategorized

Thousands of unionized workers at both of Canada’s major railways — Canadian National Railway (CN) and Canadian Pacific Kansas City (CPKC) — have voted overwhelmingly in favour of a strike, which could begin as soon as May 22. This comes after months of negotiations over rest periods reached an impasse, following the expiry of the previous contract at the end of 2023.

A strike would cause significant disruptions to grain, potash, and coal exports, in particular, which rely on railways for transport across Canada. Concerned about the economic implications of a work stoppage, federal Labour Minister Seamus O’Regan has asked the Canada Industrial Relations Board to look at whether the strike might have safety implications, such as the supply of fuel to hospitals. The strike cannot start until the board makes its decision, with the Teamsters union confirming that they would comply with any order from the board.

Shipping companies are drawing up contingency plans, with exports possibly being rerouted through the U.S. to reach coastal ports. However, backlogs will be inevitable during a work stoppage, and an extended recovery would be needed should the strike not resolve in a few days. 


Please contact us at sales@canangroup.ca to explore how we can minimize disruption to your operations during a potential work stoppage.

BC Port

Negotiations continue between BC port employers and foreperson union, with some hope of avoiding disruption

Rowena Lo Featured, News, Uncategorized

The BC Maritime Employers Association (BCMEA) and Local 514 union representing forepersons are moving forward in their negotiations with the support of the Federal Mediation and Conciliation Service (FMCS). The union represents about 730 ship and dock forepersons. 

Following the baseline set by the agreement with Longshore workers, and patterns of negotiations, there has been optimism throughout the process that a work stoppage is avoidable, a relief to a logistics industry already feeling the pressures of a possible rail strike and labour dispute at the Port of Montreal. 

Last summer’s port strike, lasting 13 days, and involving over 7,400 workers, disrupted around $9 billion worth of trade, according to some estimates. 

Breaking Point at Port of Montreal: Implications for Global Trade

Rowena Lo Featured, News, Uncategorized

Negotiations to renew the collective bargaining agreement for the Port of Montreal longshore workers, which expired on December 31, 2023, are at an impasse.

The Maritime Employers’ Association (MEA) put forward what it called its ultimate settlement offer on April 17, which was subsequently rejected by the union (CUPE 375, representing more than 1200 members) as it allegedly regressed workers’ conditions. Of the 90% of members who voted, 99.54% refused the offer, indicating a profound dissatisfaction with the MEA’s stance.

Union president Martin Lapierre criticized the MEA and the maritime company representatives on its board for their apparent provocation tactics and legal confrontations aimed at undermining the union. The union had hoped that the new president of the Montreal Port Authority (MPA) would facilitate labor relationships; instead, the MPA has complicated negotiations, challenging a recent decision by the Canada Labour Relations Board on essential services.

Amidst this tension, the union remains committed to reaching an agreement, having offered 19 potential negotiation dates through the end of May, which the MEA has not yet confirmed.

For customers and stakeholders of the Port of Montreal, this deadlock suggests potential disruptions in shipments and operations. As the negotiations continue without resolution, businesses relying on this major transport hub might experience delays and increased logistical challenges. The situation underscores the importance of monitoring developments closely, as the outcome of these negotiations could significantly impact regional shipping and supply chains.  Please contact sales@canangroup.ca for more details in how to mitigate and circumvent using the Port of Montreal until this resolved. 

Panama Canal recovery

Panama Canal on Course for Recovery with Increased East Coast Transits

Rowena Lo Featured, News

The Panama Canal is on track to increase the number of vessels passing through, signaling potential relief for East Coast shipping lanes as the dry season nears its end. After enduring the driest October in over seven decades, the Panama Canal Authority (ACP) has begun to see improvements, thanks to recent rainfall replenishing Gatun Lake—the canal’s primary water source. This development has allowed the ACP to add three extra slots for Panamax vessels, raising the daily reservations to 27.

Currently operating at 60% of its 2022 transit levels, the canal has witnessed a resurgence in traffic, especially for product tankers and container ships, which are now nearing 90% of typical activity. Despite this progress, the ACP remains cautious, noting that future plans depend heavily on continued favorable weather, though there is optimism for a full recovery by 2025.

The canal’s operations have been severely affected by El Niño, which has caused significant water evaporation from Gatun Lake. This situation has not only impeded maritime traffic but also stressed Panama’s water supply, as Gatun Lake also serves as a critical drinking water source for nearly half of the country’s population. This dual necessity places the canal at the heart of national issues, particularly with the upcoming presidential election where candidates are prioritizing water accessibility.

In response to these challenges, the ACP has proposed a $2 billion initiative to enhance the canal’s capacity. This project involves constructing a dam on the Indio River and a tunnel to direct water to Gatun Lake, potentially increasing daily transits by 11 to 15 ships. However, this proposal has faced opposition from local communities concerned about environmental impacts.

As Panama’s wet season approaches, there is further cause for optimism. The U.S. Climate Prediction Center anticipates a swift conclusion to El Niño, with a 60% chance of La Niña developing by August. This shift would likely bring cooler temperatures and more rainfall, boosting canal operations and hastening recovery efforts.

As the canal resumes higher operational levels, East Coast ports like Savannah, which heavily rely on the canal for traffic, may soon see reduced delays and a return to regular shipping transits. This adjustment could significantly benefit the Port of Savannah, which has expanded in anticipation of increased throughput facilitated by the canal’s operations.

Container ship navigates foggy conditions

Extreme Weather in Asia Affecting Vessel Transit Times

Rowena Lo Featured, News, Uncategorized

Bad weather at multiple ports across Asia has been disrupting departure schedules and resulting in congestion, with the worst-affected terminal, Shanghai East Container Terminal, causing delays of up to seven days.

In addition to fog affecting major Chinese ports, including Ningbo and Qingdao, torrential rain has caused problems at Port Klang, Malaysia, and in Singapore.

Carriers have issued advisories about these delays, which add to challenges to efficiency resulting from the need to divert vessels around southern Africa due to concerns about piracy in the Red Sea.

Canaan’s team monitors weather and safety concerns at ports and along shipping routes to provide our customers with the best solutions for vessel reliability. Please contact us sales@canangroup.ca to explore how we can minimize disruption to your operations.

Global Trade Negotiations

Update on the ILA (East Coast Union) Negotiations 

Rowena Lo Featured, News, Uncategorized

The threat of the first strike along the US East and Gulf Coasts since 1997 still exists as negotiations continue between the International Longshoremen’s Association (ILA) and carriers. The current contract is set to expire on September 30, with the ILA already indicating, last November, that union members would not work beyond that date should there be no agreement on a new deal.

Opinions are mixed on the actual threat of a strike, with some management sources confident that both sides are eager to come to an agreement and others waiting to see what the union demands for wage increases.

With the Biden administration playing a key role in negotiations with the International Longshore and Warehouse Union (ILWU) in 2023, negotiations with the ILA could be further complicated by presidential politics during an election year.

With transit time for shipments from Asia to the East Coast at 60 days, decisions to divert shipments to avoid a possible strike would have to be made before July 15. Please contact sales@canaangroup.ca to get support on how best to plan for potential disruptions caused by work stoppages.

Ships moving again through Balitmore Port

Ships Moving Again Through Baltimore Port, Four Weeks After Bridge Collapse Halts Traffic

Rowena Lo Featured, News, Uncategorized

The Port of Baltimore has initiated a significant recovery operation following the collapse of the Francis Scott Key Bridge, which obstructed maritime traffic for weeks. A newly opened 35-foot deep-water channel allowed the first cargo ships, primarily bulk carriers like the Balsa 94 headed for St. John, Canada, to resume their voyages. Notably, most of the vessels affected by this blockage were bulk ships, including one loaded car carrier, with relatively few container vessels being impacted.

This is an important step in a massive ongoing effort to restore full operational capacity to the port, which is a key hub for processing cars and farm equipment. Thousands of tons of debris from the damaged bridge have blocked the entrance to the harbour, requiring cleanup crews to work around the clock in an attempt mitigate further economic repercussions on local workers and businesses.

Despite the temporary channel allowing some movement, significant challenges remain. The main port channel, capable of handling the largest cargo and cruise ships, is still obstructed by debris, requiring continued intensive salvage operations. This situation is compounded by the closure of the temporary channel for additional cleanup phases, planned until approximately May 10.

A blue and red background with a Canadian maple leaf and the text overlay says "CARM - CBSA Assessment and Revenue Management"

CARM: New Canada Importation System Starting May 2024

Rowena Lo Featured, News, Uncategorized

On May 13th, 2024, the CARM (CBSA Assessment and Revenue Management) digital system will become the office system of record that importers and other trade chain partners will use to pay import duties and taxes. If you have not registered, please get in touch with sales@canaangroup.ca immediately since there is a potential waiting list for the April 30th, 2024 deadline. Note that the CARM Portal will not be available in the first two weeks of May. 

What is CARM? 

CARM stands for the CBSA Assessment and Revenue Management program. It is a new initiative by the Canada Border Services Agency (CBSA) that aims to modernize and streamline the process of importing goods into Canada. CARM will introduce a new electronic portal for importers and customs brokers to submit their trade data, process payments, and manage their accounts with the CBSA. The system will provide more transparency and accuracy in assessing and collecting duties and taxes and improve compliance with customs regulations. CARM will also introduce new risk assessment tools and features to enhance trade security, reduce processing times, and increase customs clearance efficiency.

Do I have to sign up for CARM? 

As a business that imports goods into Canada, you must register for the Canada Border Services Agency’s (CBSA) Assessment and Revenue Management (CARM) system. CARM is a new system designed to modernize how the CBSA processes import/export data and collects revenue on goods entering Canada. You can register yourself or ask your Canaan sales representative to assist you.

Who does CARM apply to? 

CARM, or the CBSA Assessment and Revenue Management project, applies to businesses and individuals who import goods into Canada. This includes importers, customs brokers, freight forwarders, and carriers transporting goods across the Canadian border.

Do I need a Canadian customs bond for CARM? 

Yes, you do need a Canadian customs bond to participate in CARM. The bond is a financial guarantee that you will pay any fees or penalties that may be assessed by the Canada Border Services Agency (CBSA) for non-compliance with Canadian customs regulations. A customs bond can be obtained through a licensed customs broker such as Canaan Transport Group or a surety company that provides bonding services. The bond amount will depend on your business type and the value and volume of the imported goods into Canada.

If you have further questions, please get in touch with Canaan Group sales or email sales@canaangroup.ca.

Three people on a red backdrop sitting on the stage of the TPM 2024 - Transpacific Maritime Conference

Elevating Insights from TPM 2024

Rowena Lo Events, Featured, News, Uncategorized

As we navigate through the uncertainties marking the end of the first quarter of 2024, the supply chain landscape presents a myriad of challenges and changes. At the heart of staying ahead in this dynamic environment is the annual Transpacific Maritime (TPM) Conference, a pivotal gathering in March 2024 that drew industry leaders, including the management team from Canaan Group, into insightful discussions about the future of shipping and logistics. Here, we distill the essence of the conference, encapsulating our key takeaways into three transformative insights: Global Supply, Gemini Service, and the Go-Green Initiative.

Global Supply Dynamics: Navigating Uncertain Seas

The unveiling of new container ships over the next 3-4 years casts a shadow of uncertainty over supply-demand dynamics, particularly in light of the disruptive Red Sea Attacks, which have curtailed capacity by 8% to 16%. Coupled with the International Maritime Organization’s (IMO) stringent decarbonization mandates, the industry faces a scenario where older vessels are more likely to be decommissioned than redeployed, signalling a future marked by rate volatility. These shifts underscore the critical need for agility in responding to an evolving maritime landscape.

Gemini Service: Charting a New Course

The buzz at TPM 2024 centred around the anticipated Gemini Service, a groundbreaking collaboration between Hapag Lloyd and Maersk set to commence in February 2025. This venture, which represents 22% of global container capacity, promises a hub-and-spoke model to enhance service reliability through reduced port calls. Yet, its inception may disrupt the current equilibrium within “THE Alliance,” sparking discussions on potential carrier realignments. For shippers, the imperative to adopt a diversified carrier strategy has never been more apparent as a means to cushion against service disruptions.

The Go-Green Imperative: Steering Towards Sustainability

Under the stewardship of the IMO, the maritime sector is steering towards a sustainable horizon, with ambitious targets to slash CO2 emissions by at least 40% by 2030. The pivot towards alternative fuels such as methanol and LNG emerges as a pivotal strategy, with shipping lines at the forefront of this transition. However, this green evolution comes with cost implications that are likely to ripple through to BCOs and NVOCCs. Moreover, adopting slow steaming practices as a norm underscores a commitment to environmental stewardship and hints at longer transit times ahead.

As we reflect on the insights garnered from TPM 2024, it’s evident that the path forward requires a blend of strategic foresight, adaptability, and a concerted effort toward sustainability. For Canaan Group and our esteemed clients, these insights prepare us for the challenges ahead and open avenues for innovation and resilience in the ever-evolving tapestry of global supply chain management.

If you have further questions, please get in touch with Canaan Group sales or email sales@canaangroup.ca.

An image of a rail yard like CN rail or CPKC. The rail yard is empty and not busy due to the CN rail and CPKC possible strike or lockout.

How To Prepare In the Event of a Possible Strike or Lockout at CN and CPKC in May 2024

Rowena Lo Featured, News, Uncategorized

The union representing nearly 9,300 workers at Canada’s largest rail operators, CN and CPKC, faces a potential work stoppage due to stalled negotiations over working conditions and wage increases. Teamsters Canada, led by François Laporte, accuses both rail companies of wanting to remove essential safety-critical rest provisions from collective agreements, which are crucial for combating crew fatigue and ensuring public safety. Despite seeking a negotiated settlement, the union finds the companies’ demands unacceptable.

CN and CPKC filed notices of dispute in late February 2024, marking the beginning of a process that could lead to a strike or lockout by early May. The union claims that the railroads prioritize profits over the well-being of supply chains, farmers, or small businesses and are prepared to force a work stoppage to meet their goals.

The dispute involves 6,000 CN workers and 3,200 CPKC workers in Canada, covering conductors, engineers, and yard workers, plus around 80 rail traffic controllers represented by TCRC’s Rail Canada Traffic Controllers division. The current collective bargaining agreements expired on December 31st, 2023.

Despite the onset of strikes or lockouts in Canada as part of the business landscape, many companies are unaware or have not placed enough effort to mitigate these potential risks. As a leading forward-thinking organization, Canaan Group continues to discuss with customers how to begin planning for cargo re-diversion, alternative planning, and cargo risk mitigation. At the TPM 2024, Canaan Group started to consult with several companies to prepare for a strike or lockout with the 2 Class 1 Railway companies.

If you have further questions, please get in touch with Canaan Group sales or email sales@canaangroup.ca.

A woman holding an electric bicycle containing a lithium ion battery. This is a cover photo for an article about importing e-bikes containing lithium ion batteries as dangerous goods in Canada.

Integrating E-Bikes Into Sustainable Transport: Navigating the Lithium Battery Challenge

Rowena Lo Featured, Resources, Uncategorized

In recent years, electric bikes (e-bikes) have surged in popularity, heralded for their potential to offer an eco-friendly and cost-efficient mode of transportation. This surge is backed by various Canadian provinces, which have rolled out incentives and subsidies to make e-bikes more accessible. For instance, British Columbia has introduced income-based rebates on eligible e-bikes from authorized dealers, offering $350 to $1,400 to make e-mobility an affordable option for its residents.

However, the core of e-bikes—the lithium-ion batteries that power them—presents a complex challenge in terms of shipping and transportation. Due to their flammable electrolyte and high energy density, lithium batteries are recognized as dangerous goods (DG). They require careful handling, specialized packaging, and adherence to a myriad of regulations and carrier requirements. This complexity underscores the need for expertise in logistics, as the consequences of mismanagement range from supply chain delays to severe accidents.

The lithium-ion battery market, poised to grow from USD 44.5 billion in 2022 to USD 135 billion by 2031, is predominantly driven by the demand for electric vehicle (EV) batteries. With significant growth expected in Southeast Asia and India, the logistics sector must adapt to new shipping lanes and regulatory landscapes. Unlike lithium metal batteries, which are non-rechargeable, lithium-ion batteries are rechargeable and power a wide array of devices, including e-bikes, necessitating stringent shipping protocols to mitigate risks of overheating and ignition.

Shipping lithium-ion batteries—whether by air or ocean—is fraught with restrictions. Ocean freight, given its capacity for larger volumes and fewer restrictions compared to air transport, dominates international shipping for EV batteries. Stringent regulations apply across the entire supply chain, demanding specialized knowledge for safe and compliant transportation.

The logistics of shipping lithium-ion batteries involves detailed documentation, such as the Dangerous Goods Declaration and material safety data sheets (MSDS), alongside factory tests to ensure the batteries’ resilience to heat, vibration, and more. Packaging protocols are rigorous, requiring non-metallic inner packaging to prevent short circuits and physical damage. Adherence to special marking and labelling guidelines is also required to identify the goods’ nature clearly.

Given the heightened risks associated with lithium-ion batteries, additional insurance coverage is often necessary to mitigate potential liabilities, including damage to adjacent cargo in the event of a fire. Therefore, the choice of a logistics partner becomes crucial. Opting for a freight forwarder or 3PL with proven experience in handling dangerous goods can mean the difference between the seamless integration of e-bikes into the sustainable transport ecosystem and facing the significant repercussions of regulatory non-compliance or shipping mishaps.

As the e-bike movement continues to gain momentum, bolstered by governmental support and consumer interest in green transportation, the challenge of safely and efficiently transporting lithium-ion batteries remains a critical piece of the puzzle. Addressing this challenge head-on, with the proper knowledge and partners, is essential for realizing the full potential of e-bikes as a cornerstone of sustainable urban mobility.

At Canaan Group, we specialize in handling DG cargo. Several of our colleagues hold a DG license that is renewable every two years. If you have questions on shipping e-bikes or anything DG-related, please get in touch with sales@canaangroup.ca or contact us here.

A cargo ship at a port as part of an article about balancing cost and reliability when shipping cargo or freight.

Balancing Cost and Reliability

Rowena Lo Featured, News, Resources, Uncategorized

Most customers direct much of their focus on cost per TEU, kg, CBM, or other metrics. However, only a few customers focus on the reliability of deliveries as a KPI. The reliability factor introduces some hidden costs, including cash flow management, inventory stock, and delayed payments for the final cargo delivery. Canaan Group continues to track and emphasize costs and the reliability of vendors’ key strengths and weaknesses. Our logistics professionals subscribe to various real-time data analysis sources to formulate a strategic vendor selection process to match customers’ needs. 

In the latest release by Sea Intelligence with the Global Liner Performance (GLP) report, the data shows that the reliability of global schedules is still sitting at 50%, primarily due to the Red Sea Attacks. 

Depending on the trade lanes, on average, there is at least a 6-day delay in vessel arrivals. Some trade lanes can accumulate up to 15 days of delay depending on the routing and the shipping line. Additionally, on a year-on-year basis, schedule reliability in January 2024 was 0.8 percentage points lower than in January 2023. Notably, the average delay for late vessel arrivals worsened due to round-of-Africa sailings, rising by 0.59 days month-on-month to reach 6.01 days.

In January 2024, CMA CGM emerged as the most reliable carrier among the top 13, boasting a schedule reliability of 54.7%. Following closely were four other carriers surpassing the 50% mark. The rest of the carriers maintained schedule reliability within 40% to 50%, with Yang Ming ranking as the least reliable carrier with a schedule reliability of 42.2%. Notably, in January 2024, the difference in schedule reliability between the most and least reliable carriers narrowed to its lowest point since February 2023.

If you have further questions, please get in touch with Canaan Group sales or email sales@canaangroup.ca.

Revitalizing Global Trade Routes

Rowena Lo Featured, News, Uncategorized

In a bold move signaling the evolving dynamics of international shipping, the announcement of the Gemini Alliance, set to commence in 2025, marks a significant milestone. This pioneering collaboration between Danish and German shipping lines epitomizes the industry’s ongoing shuffle, akin to a strategic game of musical chairs, promising enhanced service offerings and operational efficiencies across the globe.

ONE/WAN HAI: New Transpacific Service

Amidst this backdrop of change, ONE and WAN HAI are set to launch a groundbreaking Transpacific service, the AP1, by the end of April or early May. This new route, connecting Vietnam, China, Taiwan, and California, is poised to replace Wan Hai’s standalone AA3 service, symbolizing a fresh synergy in the Asia-North America shipping corridor. The joint venture will operate on a 56-day fixed round trip schedule, featuring a fleet of seven vessels – five from Wan Hai Line and two from ONE, as reported by Alpha Liner 2024. With a capacity ranging from approximately 5,500 to 14,000 TEU, this alliance underscores a minimum 12-month commitment to bridging economies across the Pacific.

MSC: Redefining North America-South America Connections

In a parallel stride, MSC is redefining its USA to South America East Coast (SAEC) String 1 loop. By streamlining its port calls—eliminating stops at Port Everglades, Caucedo, Suape, and Colon, while introducing new southbound calls at Freeport (Bahamas) and Cristobal—MSC is set to enhance its service efficiency. This recalibrated route will now encompass a comprehensive network, from New York down to Rio de Janeiro and back, encapsulating the essence of MSC’s strategic refocus on key transatlantic trade lanes.

ZIM: Expanding Horizons in the Americas

ZIM, not to be outdone, is reshaping its Colibri Express service between the U.S. East Coast and the West Coast of South America (WCSA). This revamp introduces the Chilean port of Lirquen into its itinerary, streamlining its operations by omitting Balboa and Buenaventura, alongside a southbound call at Guayaquil. The enhanced route promises a six-week turnaround, leveraging a fleet of six vessels, including the notable 1,717 TEU OPHELIA, which marked the inaugural sailing from Lirquen on February 15th. This strategic adjustment not only extends ZIM’s operational footprint but also reinforces its commitment to serving burgeoning markets in the Americas.


For detailed insights into our enhanced global shipping routes and new services, we invite you to connect with our Canaan Group Sales team. Elevate your logistics experience by discovering the tailored solutions we offer to meet your specific needs. Contact us for professional guidance and support.

Possible Lockout or Strike at CN and CPKC by May 2024

Rowena Lo Featured, News, Uncategorized

The union representing nearly 9,300 workers at Canada’s largest rail operators, CN and CPKC, is facing a potential work stoppage due to stalled negotiations over working conditions and wage increases. Teamsters Canada, led by François Laporte, accuses both rail companies of wanting to remove essential safety-critical rest provisions from collective agreements, which are crucial for combating crew fatigue and ensuring public safety. Despite seeking a negotiated settlement, the union finds the companies’ demands unacceptable.

Notices of dispute were filed by CN and CPKC this week, marking the beginning of a process that could lead to a strike or lockout by early May. The union claims that the railroads prioritize profits over the well-being of supply chains, farmers, or small businesses, and are prepared to force a work stoppage to meet their goals.

The dispute involves 6,000 CN workers and 3,200 CPKC workers in Canada, covering conductors, engineers, and yard workers, plus around 80 rail traffic controllers represented by TCRC’s Rail Canada Traffic Controllers division. The current collective bargaining agreements expired on December 31, 2023.

CPKC responded to the union’s accusations by stating they have offered wage increases, quality-of-life improvements, and predictable schedules with assigned days off. However, they acknowledge a significant gap remains on these issues. CPKC proposed two options for renewed contracts, emphasizing safety and employee well-being, while CN highlighted regulatory changes that necessitate a modernization of the compensation model to maintain a predictable, efficient service for both employees and customers, suggesting a structured workweek with ample rest periods and consecutive days off.

Canaan Group remains committed to delivering timely market insights to our esteemed clients, focusing on risk mitigation and strategic planning. Should your shipments depend on intermodal services, we encourage you to consult with the Canaan Group team to explore strategies for overcoming potential challenges.

Starlux Airlines Elevates Cargo Capabilities With Airbus A350 Freighter Order

Rowena Lo Featured, News, Uncategorized

Starlux Airlines, a Taiwanese airline that began operations just four years ago, has recently made a significant move in the aviation industry by ordering five A350 freighter airplanes from Airbus. This decision marks Starlux as the first Taiwanese airline to operate this next-generation cargo jet, signaling its entry into cargo transportation, particularly focusing on the global demand for electronic components and semiconductors—a market Taiwan is prominently known for.

The deal was announced during the Singapore Airshow and highlights Airbus’ competitive edge over Boeing, particularly in the race to supply the future of cargo aircraft. Starlux’s choice of the A350 freighter is strategic, given its plan to deploy these aircraft on major intercontinental trade routes, leveraging the expected rise in demand for cargo capacity.

The A350 freighter is still under development and is anticipated to offer significant advantages in terms of payload capacity, range, and fuel efficiency. Capable of carrying up to 122 tons of cargo over 4,700 nautical miles, the A350 freighter also boasts the largest main deck cargo door in the industry and a construction that utilizes advanced materials for over 70% of its airframe. These features contribute to its 20% better fuel efficiency and lower CO2 emissions compared to current models like the Boeing 777 and 747-400.

Airbus has received 55 orders for the A350 freighter from various airlines and leasing companies, indicating a strong market interest. However, Boeing’s 777-8 freighter, which also has 55 orders, remains a close competitor, with certain advantages in payload capacity and cargo volume. The industry’s preference between Airbus and Boeing often depends on existing fleet compositions, as operating a homogeneous fleet can reduce costs related to pilot training, maintenance, and operations.

This move by Starlux not only reflects the growing competition between Airbus and Boeing in the cargo aircraft market but also highlights the cautious optimism in the air cargo industry, which is slowly recovering from a recent downturn. The decision underscores the importance of advanced technology, fuel efficiency, and environmental considerations in shaping the future of air freight.

Although most of the services of Starlux is focused on Intra Asia, this announcement will present new opportunities for Asia /North America and Asia / European Lanes for the future. 

The Canaan Group airfreight team consistently collaborates with leading airlines including JAL, EVA Airlines, KLM/Air France, Air Canada, ANA, Lufthansa, Qatar, Turkish, and many others to offer extensive global service points, ensuring the most efficient transportation of your urgent cargo.

The Complexities of Global Trade

Rowena Lo Featured, News, Resources, Uncategorized

Despite shifts in geopolitics and the relocation of manufacturing hubs to countries like Vietnam and Mexico, China maintains its position as a key trading partner with both Canada and the USA. By redirecting trade through these nations, China has crafted a viable strategy to circumvent tariff barriers. This is exemplified by China’s tactical diversion of exports via Mexico, a strategy that undermines US efforts to lessen its reliance on Chinese goods. An analysis of trade data underscores a significant increase in the volume of goods moving from China to Mexico, with the number of 20ft container shipments escalating from 689,000 in the first three quarters of 2022 to 881,000 over the same timeframe in 2023. This development has positioned Mexico as the leading exporter to the US (as highlighted in last month’s newsletter), underscoring the challenges faced by the US in disentangling its supply chains from the grip of Chinese manufacturing.

China is shipping far more goods to Mexico indicating that China is routing shipment through Mexico into the US more and more.

According to the research from Financial Times this month, despite efforts initiated by the Trump administration and continued under Joe Biden to lessen US reliance on Chinese products by imposing tariffs, less than 15% of US imports now come directly from China, down from over 20% in 2017. However, this has not significantly diminished the presence of Chinese goods in the US market, as these are still entering via Mexico without facing the same tariffs.

Chinese manufacturers, especially in the auto industry, have capitalized on this route. For instance, Chinese-owned companies in Mexico exported $1.1 billion worth of auto parts to the US in 2023, up from $711 million in 2021. Mexico’s imports of vehicle parts from China also surged to nearly $9 billion last year.

This situation demonstrates the challenges the US faces in shifting away from Chinese-manufactured goods. Despite new tariffs and investment screening measures introduced by Mexico and the US, the deep integration of Chinese products into global supply chains poses significant obstacles to these efforts.

A line graph showing total Mexican trade in US is growing.

The data and proposed graphs underscore the intricate dynamics of global trade and the difficulty in altering established supply chains, reflecting the broader geopolitical and economic interdependencies that challenge US policy objectives.

In response to the evolving global landscape of diversification, innovative logistics routes are emerging. If you’re looking to explore new lanes and routings with competitive pricing, reach out to Canaan Group for tailored solutions.

Reference:

Financial Times. (2024, February 21). “China Circumvents US Tariffs by Shipping More Goods via Mexico.” Claire Jones, Christine Murray, and Keith Fray. Retrieved from https://www.ft.com/content/2ca4da83-f858-4215-88e7-544adf0aa18e.