Jaguar Freight | The Weekly Roar

In this week’s Roar: shrinking ocean capacity, concerns over the ETS, a potential rail strike, a lack of capacity in air cargo (too), and a new biggest exporter.

Ocean carriers are facing challenges when it comes to maintaining weekly sailings from Asia to Europe. It’s well-known that the closure of the Suez Canal has caused carriers to reroute ships around the Cape of Good Hope, adding to voyage times. In order to meet schedules, some carriers are adding extra ships and / or speeding up ships, despite adding about 425,000 teu of newbuild capacity so far this year.

On January 1, the European Union’s Emissions Trading System (EU ETS) policy went into effect. However, there are concerns, and one of the biggest is the impact it may have on the routes shipping companies decide to take. At some ports, there may be a dramatic increase, while the opposite may happen at others, all thanks to the new designation of certain ports as ‘Neighbouring Container Transshipment Ports’ (NCTPs). These ports will be considered ports of call when it comes to emissions calculations.

Teamsters Canada has issued a warning about a potential rail strike in early May. Negotiations between the Teamsters Canada union, which represents 9,300 workers, Canadian National (CN), and Canadian Pacific Kansas City (CPKC) railways are caught up in a disagreement over wages, hours, and safety provisions. According to the union, railways are trying to eliminate safety rest provisions. On the other side of the table, railways are saying they’re offering competitive wages and predictable schedules.

Are things what they seem in the air cargo industry? While it appears that passenger numbers and cargo volumes have fully recovered post-pandemic, there’s still a reliance on freighters. This is likely due to the current geopolitical situation, which has limited belly capacity on a number of routes. With current air cargo pricing 30% higher than it was pre-Covid, it’s hard to predict the industry’s future.

Good news for Mexico. For the first time in 20 years, they’re the biggest exporter into the US. Obviously, they have the benefit of their proximity to the US, their trade agreements, and their competitive labor costs. Additionally, the current trend toward shorter supply chains and nearshoring is also increasing their appeal. But this isn’t without challenges — they have issues when it comes to securing stable supplies of electricity, water, and skilled labor.

For the rest of the week’s top shipping news, check out the article highlights on Jaguar Freight’s website here.

Compliments of Jaguar Freight – a member of the EACCNY.