ITS Logistics November Port/Rail Ramp Index: Potential Rail Strike and Oakland Port Labor Issues

ITS Logistics November Port/Rail Ramp Index: Potential Rail Strike and Oakland Port Labor Points

ITS Logistics, right now launched the November forecast for the ITS Logistics US Port/Rail Ramp Freight Index. This month the index displays the present doable menace of a rail and port strike occurring concurrently. The November Index reveals that the doable rail strike and Oakland Port labor points looming over the availability chain trade can in truth trigger additional disruptions not seen since 2015.

“Total, a lot of the U.S. ports and rail ramps are at regular operations, nevertheless, the trade continues to be bracing for a doable strike from each ends,” stated Paul Brashier, Vice President, Drayage and Intermodal for ITS Logistics. “The continuing Worldwide Longshore & Warehouse Union (ILWU) and Rail Union labor negotiations may create vital issues to the U.S. provide chain that may influence this vacation season and the months that observe.”

This month, 59% of the members from the Worldwide Affiliation of Machinists and Aerospace Staff (IAM), voted to ratify a tentative contract settlement with freight railroads in the US. The Brotherhood of Upkeep of Approach Staff Division (BMWED) additionally made waves as they prolonged the timeframe for his or her establishment interval to December 4. Regardless of the tentative agreements, a rail strike may nonetheless happen as quickly as December 9, costing the financial system an estimated $2 billion per day with vital penalties for the trade.

On the port aspect of the trade, the Port of Oakland lately skilled a strike initiated by longshoremen who weren’t paid wages on time. Over 200 excellent wage claims have been filed relationship again to June of 2022, leading to companies doubling down on transport the majority of their cargo via the ports on the East and Gulf Coasts. Whereas extremely unlikely {that a} long-term strike will happen, even a shutdown of a few days will significantly influence the financial system with an estimated lack of $0.5 billion per day.

ITS Logistics gives port and rail drayage companies in 22 coastal ports and 30 rail ramps all through North America. As one of many fastest-growing logistics corporations in the US, the ITS Logistics US Port/Rail Ramp Freight Index gives a forward-looking evaluation of port and rail ramp freight actions together with the influence from earlier months.

“If the negotiations between the Rail Union and ILWU don’t present an finish resolution to employee’s frustrations, we may see work slowdowns or perhaps a full work stoppage happen,” continued Brashier. “The labor points within the West Area are a possible complication, the place port staff are combating for a decision surrounding automation of port capabilities and higher wages. Slowdowns and disruptions already skilled within the West Area have brought about elevated quantity on the ports on the East and Gulf Coasts.”

The present main headwind forecasted in November is ocean chassis availability within the Oakland Port and East Coast rail ramps, particularly within the smaller inside markets. Chassis availability has been impacted attributable to a scarcity of distribution facilities and warehouses receiving capability all through the U.S. The dwell time for ocean containers has additionally elevated, which has resulted in an extended unload course of.

Oakland chassis needs to be normalized all through November as many chassis’ suppliers are repositioning chassis from an oversaturated Los Angeles and Lengthy Seaside (LA/LB) market.

“There are 4 remaining unions needing to ratify the present settlement and if that isn’t completed by December 4, there’s a good probability that operations will stop,” continued Brashier. “If that is in truth the case, it signifies that U.S. rail operations and IPI containerized freight can come to a standstill due to the rail labor negotiations being unresolved. Even with this uncertainty although, ocean container charges are the bottom in years and congestion at ocean terminals all through the U.S. may be very low.”

The ITS Logistics US Port/Rail Ramp Freight Index forecasts port container and dray operations for the Pacific, Atlantic, and Gulf areas. Rail ramp exercise in each the West Inland and East Inland areas are additionally highlighted within the index. Go to right here for a full complete copy of the index with anticipated forecasts for the U.S. port and rail ramps.

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