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

23 May 2022
Coastwide contract negotiations between the ILWU and West Coast waterfront employers have been put on hold, although individual committee meetings on specific issues such as worker safety will continue.
17 May 2022
New data suggests fears of renewed and widespread port congestion in the US this summer are valid, particularly if growing imports collide with the start of peak shipping season and the return of normal cargo flow from post-lockdown Shanghai.
16 May 2022
Container terminals in Vancouver and Prince Rupert are operating at full capacity, meaning they are unable to handle any cargo diversions from US West Coast ports if longshore contract negotiations head south.
13 May 2022
The debate over whether a freight recession is starting in US trucking is getting hotter as spot rates decline but other demand and pricing indicators stay positive.
12 May 2022
Uncertainty surrounding the timing and speed at which Shanghai’s logistics sector will fully reopen after COVID lockdowns is making it difficult for US shippers and forwarders to plan for the second half of the year.
09 May 2022
US retailers are moving shipments forward in a bid to build inventories before inflation drives prices too high and weakens consumer spending.
29 Apr 2022
Multipurpose and heavy-lift vessel capacity will remain tight for years, keeping upward pressure on pricing, carrier executives said at the JOC Breakbulk & Project Cargo conference.
26 Apr 2022
Disruption from COVID lockdowns in China may worsen once those restrictions are lifted and a fresh wave of containers heads for US ports, S&P Global economist Patrick Newport warned Tuesday.
22 Apr 2022
Despite a modest increase of 2.7 percent in imports from Asia in the first quarter, continued congestion at major US gateways indicates port-related supply chains will struggle with even single-digit growth in imports this year.
18 Apr 2022
A coming import surge composed of early back-to-school and peak season merchandise and pent-up shipments from Shanghai has ports and terminal operators in Los Angeles and Long Beach concerned about another summer meltdown.
07 Apr 2022
Forecasting strong import growth this summer, US retailers warn ports of the urgency they face in addressing port-related supply chain bottlenecks.
24 Mar 2022
Ports on the East and Gulf coasts have increased their share of Asian imports to record levels as shippers and carriers mitigate the risks of West Coast port congestion and potential disruption from upcoming longshore contract negotiations.
21 Mar 2022
Trans-Pacific carriers are wrapping up service contract talks with small and mid-size shippers at much higher rates than large retailers secured just months ago.
18 Mar 2022
A second consecutive month of strong imports from Asia to start 2022 signals to US ports and supply chain stakeholders that the two-year streak of record or near-record import volumes shows no signs of abating.
08 Mar 2022
US imports are expected to be at near-record levels this spring and summer, with consumer demand remaining strong and supply chain bottlenecks showing no signs of improvement, retailers said in their latest forecast.
07 Mar 2022
Vessel bunching at Asian and US ports and congestion in the interior US are severely restricting vessel capacity in the eastbound trans-Pacific, pushing service contract rates to record levels with no relief in sight this year.
07 Mar 2022
CMA CGM has followed the industry trend of reporting extreme profitability for 2021, dramatically paring down debt while making several billion-dollar acquisitions.
22 Feb 2022
The South Carolina Ports Authority has proposed converting of one of three International Longshoremen’s Association (ILA) locals from part-time to full-time work in exchange for the ILA settling its dispute over work performed at the new Leatherman terminal in Charleston.
17 Feb 2022
Terminal operators in Los Angeles-Long Beach believe they have turned the corner on unprecedented congestion issues that have plagued the port complex for the past two years, but they say cargo flow will not improve significantly in the first half of 2022.
09 Feb 2022
A return to single-digit year-over-year growth in imports in the first half of the year will still not provide the relief necessary for US ports to clear their cargo and vessel backlogs, according to retailers.
02 Feb 2022
Labor and chassis shortages and increasing truck turn times and vessel backlogs signal more congestion ahead for the ports of Los Angeles and Long Beach in the coming months.
02 Feb 2022
A trucker blockade at a small US-Canada border crossing will bring big cost increases for cross-border shippers, as US carriers begin to embargo or reroute freight hundreds of miles.
31 Jan 2022
A willingness by carriers to deploy more sweeper ships to evacuate empty containers, and carry empties from competing lines, will have a major impact on mitigating an important source of congestion, the ports of Los Angeles and Long Beach say.
27 Jan 2022
The Port of Vancouver is trying to restore cargo fluidity that has been disrupted from punishing rain and snowstorms that have hit British Columbia’s rail and road infrastructure over the past two months.
26 Jan 2022
The ports of Los Angeles and Long Beach want to give the temporary extension of a fee on daytime container moves more time to determine if truck moves during the off hours increase substantially.
25 Jan 2022
The ports of Los Angeles and Long Beach are considering an innovative but complex plan to reduce the number of empty containers that are contributing to terminal congestion by incentivizing shipping lines to increase the volume of containers they pick up during each call.
21 Jan 2022
Yantian International Container Terminal (YICT) and Shekou Container Terminal are restricting the number of export containers they will accept in an effort to clear an existing backlog of boxes in advance of the Lunar New Year holiday on Feb. 1.
19 Jan 2022
Despite an expected return to single-digit monthly increases in imports from Asia this year, already-stressed US ports are still likely to struggle to handle cargo volumes.
07 Jan 2022
Retailers are pulling back somewhat on their growth projection for imports because global supply chain problems will continue to restrict cargo volumes moving through US ports.
04 Jan 2022
Employers and the ILWU fear that the spike in COVID-19 cases that surfaced about two weeks ago in Los Angeles and Long Beach is set to explode over the next two weeks, meaning historic vessel congestion could worsen.
27 Dec 2021
The ports of Los Angeles and Long Beach once again postpone the long-dwell container fees as a major terminal operator in Long Beach imposes fees of its own.
17 Dec 2021
A slight year-over-year decline in imports from Asia in November from near-record volumes a year ago appears to be the result of thousands of containers idled on vessels sitting outside congested US ports.
15 Dec 2021
Congested marine terminals, chock-full warehouses, and chassis shortages are likely to create a high level of supply chain disruptions throughout 2022, experts told JOC’s Port Performance North America webcast.
08 Dec 2021
Retailers project continued strong imports into 2022, with no traditional post-holiday slack period, as sales remain strong and ports work overtime to reduce vessel backlogs.
03 Dec 2021
An extreme shortage of warehouse and distribution space across the US, fueled by record imports and last-mile demand, will continue to push up lease rates well into 2022, according to Jones Lang LaSalle.
23 Nov 2021
Tension is mounting on the West Coast as the ILWU formally rejected an employer offer to extend the existing coastwide contract for one year beyond the July 1, 2022 expiration date.

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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