Radiant's Freight Market Update

This week: DHL cargo plane crash in Lithuania sparks global investigation; LTL rate hikes are likely to hold despite softer demand; Rate hikes struggle as carriers rely on blank sailings to maintain stability.

Current Critical Industry Trends

DHL cargo plane crash in Lithuania sparks global investigation. A tragic crash near Vilnius airport claimed one life and left three others injured when a 31-year-old Boeing 737-400 broke apart during a forced landing. The plane, carrying standard parcels, ignited a massive fire upon impact. Lithuanian and German authorities, with assistance from U.S. investigators, are probing the incident to determine whether it was an unfortunate accident or part of a broader hybrid attack.

Ocean

Carriers push Asia-Europe rates higher ahead of December hikes. Spot rates climbed by $620 this week, reaching $4,700 per FEU for Asia-North Europe and $4,900 for Asia-Mediterranean. Strong pre-Lunar New Year bookings and blank sailings are driving carriers’ push for a 30% rate increase.

Ports

Strong consumer demand continues to fuel innovation and efficiency at major ports. The Port of Los Angeles saw a 28% surge in TEUs this September, while the Northwest Seaport Alliance handled 264,448 TEUs, with auto volumes up 6.5%.

Manzanillo Port to quadruple capacity with $3 Billion expansion. Mexico’s new port will add 1,880 hectares and two container terminals. The expansion, featuring renewable energy solutions, is set to create 65,000 jobs and generate $10 billion in revenue.

International

Rate hikes struggle as carriers rely on blank sailings to maintain stability. Container spot rates remained mostly flat despite attempts to raise Asia-Europe prices. To control capacity, carriers have scheduled 70 blank sailings, impacting 10% of global departures and signaling potential disruptions ahead.

Canada Post strike halts 10 million parcels amid mounting losses. With 55,000 workers on strike, Canada Post has missed delivering 10 million parcels ahead of Black Friday, exacerbating a $315 million quarterly loss. Talks remain deadlocked as Canada Post pushes weekend deliveries with contract labor.

Trucking

LTL rate hikes are likely to hold despite softer demand. Major US LTL carriers have implemented rate increases of 4.9% to 7.9%. Even with reduced demand, carriers are maintaining strong financial performance by investing in technology, improving efficiency and benefiting from a consolidating market.

Ontario’s MHDV electrification faces cost and infrastructure challenges. While 40% of medium-duty vehicles could transition to electric by 2027, only 1% of Ontario fleets have made the switch. The province urgently needs 8,000 Level 3 chargers by 2030, yet the current infrastructure remains far from sufficient.

Rail

CN Rail faces a potential strike as workers push for job security. With over 96% support, 3,600 CN Rail mechanics and clerks have approved a strike mandate, setting the stage for potential job action starting January 1 if key demands aren’t met.

Air

Air cargo rates rise, but peak season momentum stalls. Transatlantic air cargo rates have jumped 50% and spot rates from China to North America are up 17%. Despite these gains, early inventory planning and a slowdown in global manufacturing have tempered the typical peak season surge.

Technology

Smart Container Alliance tackles drug smuggling in global trade. Traxens, Hoopo and other IoT leaders have joined forces to enhance sensor technology in shipping containers. By ensuring interoperability, the alliance aims to help customs and shipping lines swiftly disrupt smuggling routes worldwide.

Other

3PLs expand warehouse leasing as retailers shift to outsourcing. 3PLs claimed the largest share of bulk leasing activity at 34.1%, with 498 leases over 100,000 square feet this year. Retailers are embracing 3PLs for inventory flexibility, as outsourcing becomes a key strategy in uncertain times

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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.