Coronavirus Effect on Supply Chains

Coronavirus Effect on Supply Chains

The coronavirus disease 2019 (COVID-19) is upending global container volume demand and rippling through containerized supply chains.  That's sending shockwaves to all freight transport modes, from trucking to air cargo. 

The widening impact COVID-19 is having on retail and manufacturing demand is creating the need for two importing speeds. Cargo owners such as apparel and automotive importers want to delay receiving goods for now-closed brick-and-mortar stores and production lines, whereas importers shipping personal protective equipment (PPE) and essential household consumer goods want them faster.  Against that backdrop, carriers, forwarders, port authorities, and marine terminals are warning of a cargo bottleneck if more Western importers fail to pick up containers when they arrive, causing port congestion and inland equipment shortages that will slow down the broader supply chain.

Bookmark this special page for regular updates on how the industry is responding.

News & Analysis

15 Jan 2021
A chassis shortage has caused some containers to idle at BNSF’s ramp in St. Paul, Minnesota, an offshoot of the congestion in Chicago, but not as disruptive given the relative small rail volume in the Twin Cities.
14 Jan 2021
Union Pacific Railroad’s decision to rescind record-breaking surcharges on the West Coast beginning Jan. 17 will lower prices for importers moving cargo through Los Angeles.
12 Jan 2021
Truck turn times and container dwell times deteriorated further in Los Angeles-Long Beach in December, with even the best-performing terminals struggling to handle the volumes.
11 Jan 2021
DCLI ran out of chassis last week in Chicago, and cargo owners are frustrated because Union Pacific will not release their containers to draymen with trucker-owned chassis.
11 Jan 2021
While signing so-called early-bird contracts is not a new phenomenon in the eastbound trans-Pacific, this year is different because the early signings are more frequent and driven more by space guarantees than freight rate considerations.
06 Jan 2021
The distribution of COVID-19 vaccines in the US is being slowed not by transportation issues, but by “last-mile” inefficiencies in many states, especially a lack of personnel, funding, and necessary planning.
04 Jan 2021
CMA CGM will launch a Yantian-to-Oakland premium service, which will be the only first-call inbound service from Asia to date for the Northern California port.
28 Dec 2020
Carriers say they are addressing supply chain problems over which they have control in order to relieve congestion at major load center ports.
23 Dec 2020
Drayage capacity in Miami is tight due to an unusual late-year surge in fruits and vegetables, cigars, and casual wear, causing truckers to be booked up seven to 14 days in advance.
18 Dec 2020
There’s debate about how much of a knock-on effect COVID-19 vaccine distribution could have on other types of cargoes, but US shippers are cautioned to plan for some disruption.
17 Dec 2020
The truck driver turnover rate is rising at truckload carriers as they compete for employees; that is spurring a new round of pay hikes for drivers.
17 Dec 2020
The warning from two FMC commissioners comes as some carriers are refusing export bookings so they can ship empty containers back to Asia faster to be refilled with higher-paying exports to the United States.
16 Dec 2020
BNSF Railway is limiting the amount of containers its partners can bring into a terminal in Southern California and on certain Chicago lanes due to volumes that usually tail off after Thanksgiving but have stayed elevated this year.
16 Dec 2020
The widespread distribution of coronavirus vaccines early next year will compete for limited transport capacity amid peak air cargo season, with the shipments channeled through the same hub airports.
14 Dec 2020
US imports from Asia in November were unusually strong, down only slightly from the peak months of October and August.
14 Dec 2020
Norfolk Southern has shut the gates on containers and trailers entering its 63rd Street terminal in Chicago to five Northeast locations due to a crush of volume, likely sending the loads to full truckload.
10 Dec 2020
As the US Treasury Secretary defended the $700 billion CARES Act loan that saved one of the largest US trucking firms, a GAO report criticized the Treasury’s handling of the application.
10 Dec 2020
Volume in Georgia, South Carolina, and Virginia is rising quickly, including an all-time container record in Savannah and Norfolk in November, due to continuing demand for furniture and appliances.
09 Dec 2020
Container terminals in Los Angeles-Long Beach are overwhelmed by imports, resulting in almost week-long vessel dwell times and a pressing shortage of longshore labor, according to a terminal executive.
04 Dec 2020
The growing equipment imbalance and strong demand from European importers has led to drastic action from CMA CGM.
02 Dec 2020
Port of Los Angeles executive director says greater trucker participation in the two-week-old Return Signal platform will help to mitigate the congestion problems caused by truckers’ difficulty in returning empty containers to the marine terminals.
20 Nov 2020
The FMC’s order drew immediate support from organizations representing truckers and agricultural exporters, who have testified about carrier practices they say contribute to port congestion and bottlenecks in the international supply chain.
19 Nov 2020
California agricultural exporters say failing to deliver their products on time to overseas customers can result in buyers attempting to “wiggle out” of contracts that contain firm deadlines.
18 Nov 2020
While not as high as their prior forecast, shippers in the eastbound trans-Pacific should still expect service contract rates next spring above current levels because carriers will continue their policy of tight capacity management, Drewry says.
18 Nov 2020
Shippers forced out of air and ocean trades by limited space and high rates are turning to overland transport from China to Europe, but the high demand is stoking capacity and equipment issues.
13 Nov 2020
Carriers believe inventory replenishment in early 2021 could offset a drop in consumer spending and maintain volume on the Asia-Europe trades.
11 Nov 2020
The world greeted news of a potential vaccine with relief, but the supply chain logistics required to transport doses at extreme temperatures will be daunting.
10 Nov 2020
US imports from Asia increased more than 10 percent in October, with forwarders forecasting only a modest slowdown in growth through January
10 Nov 2020
Ocean Network Express’ forecast for a highly profitable financial year is an example of the incredible pricing power being exerted by the carriers right now.
09 Nov 2020
Retailers say the record peak season of 2020 will be followed by lower year-over-year import growth in the next few months, with the strength of the US economic recovery next year dependent on progress controlling coronavirus disease 2019.
09 Nov 2020
The sustained strength in demand on trades out of Asia is keeping rates elevated and placing container availability under intense pressure.
06 Nov 2020
The Asia-Europe trade is currently in the middle of what should be a traditional period of slow demand, but an extended peak season is keeping ships full and rates elevated.
05 Nov 2020
There is no certainty the current strong demand that is keeping rates up on the Asia–Europe trade will continue past Chinese New Year, something that is starting to be reflected in longer-term rates.
05 Nov 2020
Carriers are concentrating efforts on increasing their share of direct business with shippers, but DB Schenker says forwarders offering a wide range of services will always be in the picture.
04 Nov 2020
Trans-Pacific carriers, including those offering premium services, have been unable to fulfill all of their bookings in recent weeks due to the container shortage in Asia.
04 Nov 2020
US agricultural exporters fear that even if they pay higher shipping rates, carriers will still turn down their bookings because liners can generate much higher revenue by using the containers for US imports from Asia.

Commentary

With so many products currently subject to Trump administration tariffs, a huge portion of entries from China will not be eligible for CBP's recently announced COVID-19-related duty deferral program.

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