Canadian port strikes lead to higher transpacific freight rates
5688.cn News: On July 14, due to the intensified congestion on the west coast of the United States caused by the strike of longshoremen on the west coast of Canada, the Shanghai container freight index (SCFI) was closed, and the transpacific container freight rate rose again. Liner operators have also canceled sailings due to low demand. The index shows that the freight rates of Asia-U.S. West Coast and Asia-U.S. East Coast are $1,771/FEU and $2,662/FEU, respectively, up 26% and 12% from July 7th.
Linerlytica said in a report published on July 17: "The transpacific freight rate hike on August 1 has strong momentum, helped by capacity cuts and peak season demand, and the disruption caused by the closure of Canadian Pacific ports for two weeks. Helping to keep capacity utilization high enough to keep freight rates going up." A 13-day longshore workers' strike at Canadian Pacific ports ended on July 13 after the British Columbia Maritime Employers Association reached a tentative agreement with Canada's International Longshore and Warehouse Workers Union (ILWU) on a new four-year agreement that will The agreement still needs to be ratified by both members.
Port operations in Vancouver and Prince Rupert restarted the next day with 13 containerships in Vancouver and six in Prince Rupert. Congestion at U.S. West Coast ports hit a nine-month high last week at more than 200,000 TEU and the backlog will take weeks to clear, including ships diverting to Seattle and Tacoma to avoid traffic jams . However, the settlement of the ILO contract in the United States and Canada will pave the way for a full resumption of normal port operations on the West Coast. However, there is concern that as dock workers return to work, the easing of congestion could add to supply pressures in the market. Last week, Zim forecast a full-year loss, while liner operators have accepted the fact that there will be no peak season this quarter.