Radiant's Freight Market Update

This week: Panama Canal moves toward restoring capacity; Ports call for delay on 25% tariff on Chinese-made STS cranes; Canadian rail workers reauthorize strike.

Ocean

Panama Canal moves toward restoring capacity. The Panama Canal is increasing the number of daily transits back to 35 as of August 5 as water levels rise during the region’s rainy season. The plan calls for a series of steps moving from 32 to 33 on July 11 and to 34 on July 22. The additional slot will be at the larger Neopanamax locks which will be restored to 10 daily transits. Measures to restore capacity include adjusting vessel draft limits and enhancing water-saving practices. The Panama Canal Authority has emphasized the need for sustainable water management to ensure continued canal operations.

Ports

Ports call for delay on 25% tariff on Chinese-made STS cranes. U.S. port authorities are urging the federal government to delay a proposed 25% tariff on ship-to-shore (STS) cranes manufactured in China. They argue the tariff would increase costs and delay critical infrastructure projects necessary to handle growing cargo volumes. The tariff, set to take effect on December 1, 2023, could significantly impact port operations and the broader supply chain. Ports are requesting the postponement to seek alternative suppliers and mitigate potential disruptions.

Charleston pauses construction to clear backlog. The South Carolina Ports Authority has halted a construction project at its North Charleston terminal to clear a cargo backlog caused by a recent volume surge. The pause, affecting gate and road work, aims to enhance container movement efficiency. The port is also collaborating with labor unions to maximize workforce deployment during this period.

ONE adds India Service at Port of Savannah. Ocean Network Express (ONE) has launched a new service at the Port of Savannah, connecting Georgia with India. The service, called West India North America, will support growing manufacturing and trade demands between the U.S. and India, and will offer a weekly route from Bin Qasim, Hazira, Nhava Sheva and Mundra to New York and Savannah.

Trucking

DOT awards $1.8B for various freight and transportation projects. The U.S. Department of Transportation (DOT) has allocated $1.8 billion for freight and transportation infrastructure projects under the Infrastructure for Rebuilding America (INFRA) program. This funding will support 66 projects across the country, focusing on enhancing safety, reducing congestion, and improving supply chain efficiency. Key projects include upgrades to highways, bridges, and railways, with an emphasis on rural and underserved communities. The investment aims to bolster the national transportation network and promote economic growth.

Rail

Canadian rail workers reauthorize strike. Members of the Teamsters Canada Rail Conference (TCRC) have reauthorized strikes against CN and CPKC railways, highlighting unresolved labor disputes. The authorization comes amid unresolved negotiations over wages, safety, and working conditions, potentially disrupting rail operations if a strike proceeds. The vote does not mean a strike is imminent, but does position members of the Teamsters Canada Rail Conference to conduct a work stoppage unless members receive a new contract.

Air

Air freight faces potentially turbulent summer, ocean freight plays a key role. Air freight is expected to experience a turbulent summer, significantly influenced by ocean freight dynamics. Market experts note that stability in air cargo volumes could be disrupted if ocean shipping faces significant issues. Historically, delays and capacity constraints in ocean freight have led to increased demand for air cargo. The situation suggests a volatile market ahead, where air freight demand could surge if ocean freight falters.

International

Multinationals reevaluate China-centric supply chains amid trade tensions. Rising trade tensions and tariffs are prompting multinational companies to reassess their reliance on China-centric supply chains. Businesses are exploring diversification to mitigate risks associated with geopolitical instability and economic uncertainties. Many are shifting some operations to other Asian countries or back to domestic markets to ensure stability and reduce dependency on China.

Technology

Strategies and tips to prevent containers from going missing. To prevent containers from going missing, industry experts recommend using GPS tracking, electronic seals, and blockchain technology for real-time monitoring and secure transactions. Additionally, improving communication and documentation processes between shippers, carriers, and receivers is crucial. Regular audits and training for personnel on best practices for cargo security are essential steps in mitigating risks. Read more here.

Other

Demand for updated warehousing facilities expected to increase. The demand for warehousing is anticipated to rise, but modern facilities are essential. Outdated warehouses struggle to meet the needs of e-commerce, which requires higher ceilings, better racking systems, and improved loading docks. Facilities must also integrate advanced technologies, like Navegate® GTM, for inventory management and automation to stay competitive. Upgrading infrastructure and ensuring energy efficiency can attract more businesses seeking reliable and cost-effective storage solutions.

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The Radiant Network's supply chain and logistics updates provide valuable insights on freight trends, customs regulations, global news, economics, tech, and more. The Radiant Network includes the brands Radiant World Trade Services, Radiant Global Logistics, Radiant Canada, Radiant Road & Rail, Adcom, Airgroup, SBA, and Distribution By Air.

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Radiant World Trade Services is a part of Radiant Logistics, Inc. (NYSE American: RLGT), a publicly traded third-party logistics company that provides technology-enabled global transportation and value-added logistics solutions to a diverse account base. They offer comprehensive services including freight forwarding, truck and rail brokerage, warehouse and distribution, customs brokerage, order fulfillment, inventory management, and technology services. Radiant has an extensive network of offices throughout North America and other key markets worldwide.