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

26 Oct 2020
Although economic forecasts point to a possible weakening in consumer demand, carriers are expected to continue the capacity management discipline they have displayed all year to prevent rate destruction in the trans-Pacific trades
26 Oct 2020
The on-time performance of carriers has declined sharply since a 2020 high in June when large amounts of capacity were blanked
26 Oct 2020
Alternatives to expensive air freight have been available on the trans-Pacific for years, but as space constraints make air cargo an increasingly unreliable option, a new expedited ocean product will soon be launched on the trans-Atlantic
23 Oct 2020
The strength of third quarter demand and the rate rises generated on the major trades through the peak season can be seen in the revenue and volume growth reported by OOCL.
22 Oct 2020
Asia–Europe demand forecasts for 2021 are becoming increasingly unclear as annual contracts come to an end, while high spot market levels have put shippers on course for significant long-term rate increases.
21 Oct 2020
Union Pacific Railroad will raise the surcharge on small shippers to $1,000 on excess contract cargo beginning Oct. 25, a signal that rail-owned containers remain in short supply on the West Coast.
21 Oct 2020
Limited air cargo capacity and high ocean load factors are keeping demand elevated on the overland rail network between China and Europe.
21 Oct 2020
Europe’s two busiest ports report solid import demand from China through the third quarter, which has helped mitigate the weak throughput of the second quarter.
19 Oct 2020
The congestion that has plagued the ports of Los Angeles and Long Beach over the past two months is expected to get worse in the coming weeks owing to a “record” spike in imports.
19 Oct 2020
Available drivers have been hard to find with such a sudden and sharp rise in domestic and international container flows, placing a great deal of strain on the fluidity of the supply chain.
16 Oct 2020
J.B. Hunt said intermodal results were worse than anticipated because of major network congestion in rail terminals and shippers sitting on containers, which may not ease until 2021.
16 Oct 2020
Analyst Drewry has joined Maersk and Hapag-Lloyd in substantially raising its full-year profitability guidance for the container shipping industry.
16 Oct 2020
Limited air cargo capacity is colliding with strengthening demand, as technology product launches compete for space with general cargo and medical equipment.
15 Oct 2020
Newly released data shows the disruptive extent of unexpectedly high demand on the major trades out of China, with cargo rollovers continuing across Asia’s main transshipment ports.
15 Oct 2020
Europe’s second-busiest container port has reported limited impact from COVID-19 on its nine-month throughput, with demand increasing in the third quarter.
14 Oct 2020
The long run-up in spot market truckload rates and truck freight demand may be reaching its peak, but don’t expect a quick descent, speakers at the Transplace Shipper Symposium said Wednesday.
14 Oct 2020
A huge volume of imports from China that was concentrated mostly in Los Angeles and Long Beach produced a banner month for the Southern California port complex in September.
13 Oct 2020
The sustained recovery of demand across its major markets, combined with effective cost-cutting measures, have driven Maersk to once again ramp up its full-year guidance.
12 Oct 2020
This year’s peak season promises to be tumultuous, but 2021 could be just as difficult for shippers as 2020.
12 Oct 2020
CMA CGM appears to finally be on top of the cyber attack that took the carrier offline for two weeks and disrupted its global online network.
09 Oct 2020
The ongoing trend toward online shopping that accelerated due to COVID-19 lockdowns in the second quarter could be a death knell for thousands of retailers unable handle the growing e-commerce volume.
09 Oct 2020
The extreme volatility in demand on the two main east-west container shipping trades is severely testing containerized supply chains.
08 Oct 2020
US retailers are stepping up their purchase orders and import projections for the rest of the year in order to avoid a repeat of the stock outages that occurred this summer.
07 Oct 2020
Logistics executives do not expect spot truckload rates to soar much higher, but they do not think they will drop either, forcing shippers to collaborate more.
07 Oct 2020
Although the growth in US imports decelerated slightly in September from August, the double-digit, year-over-year monthly increase indicates there is still strong momentum for the coming months.
07 Oct 2020
Carriers are riding high on a profitable wave of record rates, surprisingly strong demand, and lower fuel costs, but there is no consensus among analysts and ratings agencies on whether it will be sustainable.
05 Oct 2020
While carriers are deploying extra-loaders and reinstating blank sailings, space in the eastbound trans-Pacific is still lagging demand and equipment in Asia is tight, so US importers are paying premium rates to guarantee priority services.
02 Oct 2020
Monday’s opening of the new Gerald Desmond bridge in Long Beach, part of a massive $4.5 billion capital expenditure program, will provide the immediate benefit of reducing truck turn times.
01 Oct 2020
The new rate differential tracked by DAT chief scientist Chris Caplice is rising at a faster pace, a sign that shippers will see a greater increase in truckload contract rates.
01 Oct 2020
The Port of Virginia’s year over year volume rose in September for the first time since the COVID-19 pandemic, with truck turn times still less than 40 minutes on average but elevated rail container dwelling.
01 Oct 2020
Mounting congestion at marine terminals in Los Angeles and Long Beach is adding to the woes of importers who have already been contending with shortages of equipment, warehouse workers and truck capacity.
30 Sep 2020
Shippers moving to mini-bids as truck capacity tightens need more detailed and near-real-time data to match freight lanes and tractor-trailers.
30 Sep 2020
The rush to ship ahead of China’s Golden Week elevates rates on the Asia-Europe trades to levels not seen for a long time.
30 Sep 2020
Maersk and MSC do not believe demand on the trans-Atlantic through the fourth quarter will be strong enough to support four Europe-North America loops.
29 Sep 2020
East and Gulf coast ports offer significant rail-related cost advantages to the interior, leading the Pacific Maritime Association to urge West Coast ports to operate more efficiently in order to prevent further erosion of market share of US imports from Asia.
29 Sep 2020
Reliability will be more important than price for air cargo shippers during what is expected to be a strong peak season made more intense by severe long-haul capacity constraints.

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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