WEEK 20 MARKET UPDATE

STATE OF FREIGHT TAKEAWAYS: FREIGHT CRASH MAY TURN INTO SUDDEN REVIVAL 

Four weeks after the April State of Freight webinar, when a raging trade war looked to wreak havoc on freight markets,  the May edition of the monthly series confronted conditions that were getting at least a temporary reprieve because of the 90-day truce agreed upon by China and the United States.The first signs of change are indications that freight  movement from China to the U.S., pushed down sharply by the Trump administration’s 145% tariffs, is starting to  rebound. Fuller said the market is on the verge of a “short-term bounce back, which is definitely happening.” It’s likely to  last for a week or two weeks as Chinese exporters of products to the U.S. move to resume shipments. It may last longer  than that, he added, possibly as much as a month. With imports having come in before the 90-day pause in  implementing stiff tariffs on both the Chinese and U.S. sides in order to “beat the clock,” and the likelihood that it may  come again as importers seek to get product to U.S. shores, moving product to warehouses or end users by rail with no  hard time constraints looks increasingly attractive, they said. “It’s easiest to just say, ‘I’m going to pull that container  right off a boat and put it onto the rails, because I have an extended lead time,’” Fuller said. 

LONG BEACH SEES RECORD TEUS ON TRADE WAR EFFECT 

The Port of Long Beach, California, marked its strongest April on record, handling 867,493 twenty-foot equivalent units,  a 15.6% increase compared to the same month a year ago. Volumes surpassed the previous record set in April 2022 by  5.7% at the hub. Imports rose significantly to 419,828 TEUs, representing a 15.1% increase y/y, while exports declined by  4.5% to 93,842 TEUs.Empty containers saw the most dramatic change, jumping 23% to 353,824 TEUs, as demand for  boxes moving out of Chinese ports dropped amid the de facto trade embargo. Carriers blanked dozens of eastbound  trans-Pacific sailings and moved some ships to higher-volume trade lanes. The April performance extends to 11 the  number of consecutive months of cargo increases at the port, which along with Los Angeles makes up the San Pedro  complex, the busiest U.S. import container gateway. Port of Long Beach Chief Executive Mario Cordero in a release said:  “After moving the most containerized cargo of any American port in the first quarter of 2025, we are now anticipating a  more than 10% drop-off in imports in May – and the effects will be felt beyond the docks. Soon, consumers could find  fewer choices and higher prices on store shelves and the job market could see impacts, given the continuing  uncertainty.” 

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MEXICO’S LARGEST CONTAINER PORT SLOWLY REOPENS AFTER WORKER STRIKE

Mexico’s largest container port resumed some operations Monday after a four-day strike by customs workers led to  blockades, delays and logistics disruptions. Revenue losses at the Port of Manzanillo due to the strike between May 12  and last Thursday are estimated to total $150 million, officials said. Guillermo del Río, president of the Western  Maquiladora and Export Manufacturing Industry Association, said although some drayage trucks began moving  containers at the port on Monday, it will take two to three weeks to resume normal operations. The Port of Manzanillo,  on Mexico’s Pacific Coast, is one of the main gateways for international trade in the country. The port handles about  4,000 truck movements daily and processed nearly 4 million twenty-foot equivalent units in 2024.The strike by workers  from the Manzanillo Port Customs Office began May 12 and included accusations of workplace harassment, along with  demands for better working conditions, more personnel and extended customs hours. Some reports indicate the  customs workers discussed their demands with federal officials and decided to leave on their own Thursday. However,  the Manzanillo Freight Transport Union alleged that federal authorities stepped in Thursday night to remove and arrest  some of the striking customs workers to allow the port to resume activities. 

CONTAINER SHIPPING TO BRACE FOR FOUR-YEAR ROUGH RIDE 

Disruption and turmoil are the apparent modus operandi of the Trump administration in the US and that will be the norm for the duration of his tenure, as experts tell the industry to brace for the bumpy ride. “It’s been an interesting  ride,” began Jansen, with considered understatement, who thought this year had started well with the run up to Chinese  New Year and then the disruption caused by the reconfiguration of alliance“Since Chinese New Year, I think we saw an  erosion of the spot rates, which was probably a little bit stronger than we would normally see, when just looking at the  at the seasonal pattern. And then of course, at the beginning of April we had liberation day in the in the US where all the  reciprocal tariffs were announced,” he added.

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