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Ocean Freight Spot Rate Growth Slows, but Market Challenges Persist

global trade ocean freight rate

Ocean Freight Spot Rate Growth Slows, but Market Challenges Persist

The rapid increase in ocean freight container shipping spot rates appears to be slowing, though the market remains highly challenging. According to the latest data from Xeneta, an ocean freight rate benchmarking and intelligence platform, spot rates on major trades from the Far East are set to rise again on June 15, but at a slower pace compared to the sharp increases seen in May and early June.

Read also: Freight Rates Are Ballooning to Pandemic Highs 

On June 15, average spot rates from the Far East to the US West Coast will rise by 4.8% to USD 6,178 per 40ft equivalent unit (FEU), a more modest increase compared to the 20% hike on June 1. Similarly, rates to the US East Coast will increase by 3.9% to USD 7,114 per FEU, following a 15% rise on June 1.

Peter Sand, Xeneta’s Chief Analyst, noted, “Any sign of a slowing in the growth of spot rates will be welcomed by shippers, but this remains an extremely challenging situation and it is likely to remain so. The market is still rising and some shippers are still facing the prospect of not being able to ship containers on existing long-term contracts and having their cargo rolled.”

From the Far East to North Europe, average spot rates are projected to increase by 10% on June 15 to USD 6,357 per FEU. Although this is less than the 20% jump on June 1, it remains a significant mid-month rise. Rates to the Mediterranean are set to increase by 7.2% on June 15 to USD 7,048 per FEU, compared to a 19% rise on June 1.

Sand emphasized the ongoing pressures in the market, noting that average spot rates from the Far East are up 276% to the US West Coast and 316% to North Europe compared to mid-December last year. Factors such as the conflict in the Red Sea, port congestion, equipment shortages, and shippers frontloading imports ahead of the Q3 peak season are all contributing to the strained conditions.

The potential breakdown of labor negotiations and threat of union action at US East Coast and Gulf Coast ports could further exacerbate the situation. Additionally, rising spot rates could impact inflation in the US and Europe if these costs are passed on to consumers.

While it is uncertain if spot rates will reach the levels seen during the Covid-19 pandemic, Sand pointed out that numerous factors, including a potential ceasefire between Israel and Hamas, could significantly alter the market landscape.

In summary, despite a slowdown in the rate of increase, the ocean freight container shipping market remains fraught with challenges, with continued upward pressure on spot rates and significant uncertainties ahead.

global trade rates freight import

Ocean Freight Container Rates Soar Amid Global Supply Chain Disruptions

Ocean freight container shipping spot rates are set to surpass levels seen during the peak of the Red Sea crisis, reaching heights not witnessed since the Covid-19 pandemic, according to the latest data released by Xeneta.

Read also: Freight Rates Are Ballooning to Pandemic Highs 

Peter Sand, Xeneta’s Chief Analyst, remarked, “The market has experienced rapid and dramatic increases in May, with further growth in spot rates expected. On June 1, we anticipate spot rates reaching levels unseen since 2022, when the pandemic severely disrupted ocean freight supply chains.”

Rapid Rate Increases

Spot rates have been climbing swiftly across various trade routes:

  • Far East to US West Coast: Rates are projected to hit $5,170 per FEU on June 1, surpassing the Red Sea crisis peak of $4,820 from February 1. This marks a 57% increase in May, the highest in 640 days.
  • Far East to US East Coast**: Rates are expected to reach $6,250 per FEU, nearing the Red Sea crisis peak of $6,260, reflecting a 50% increase since April 29.
  • Far East to North Europe**: Rates are forecasted to rise to $5,280 per FEU on June 1, up from $4,839 on February 16, marking a 63% increase since April 29.
  • Far East to Mediterranean**: Rates are anticipated to exceed the Red Sea crisis peak, reaching $6,175 per FEU, a 46% increase in May and the highest in 610 days.

Contributing Factors

Xeneta’s data highlights several factors driving the spike in spot rates, including ongoing Red Sea conflict, port congestion, and shippers frontloading imports ahead of the traditional Q3 peak season. Sand explained, “Businesses are shipping goods earlier to protect supply chains, contributing to market uncertainty. The situation is more nuanced now than during the Red Sea crisis.”

Efforts by ocean freight carriers to mitigate disruptions, such as increasing transshipments and re-aligning capacity, have led to severe port congestion and unintended consequences, exacerbating the rate increases.

Challenges and Optimism

While the spot rate hikes spell trouble for shippers, Sand offers a glimmer of hope. “The growth rate of spot rates in June is not as rapid as in May, hinting at a potential easing of the situation. However, carriers continue to prioritize high-paying shippers, causing issues for those with lower rates on long-term contracts.”

Freight forwarders face new surcharges and premium service pushes, leading to higher costs passed on to shippers. “The situation may worsen before it improves,” Sand warned, noting that carriers will likely continue pushing for higher rates.

In conclusion, the ocean freight container shipping industry faces significant challenges with escalating spot rates, driven by global supply chain disruptions. While there is some hope for stabilization, shippers must brace for potential further increases and ongoing uncertainty.

digital ports global trade ai

How AI is Revolutionizing Ocean Freight Pricing

The ocean freight industry stands as the backbone of global trade, facilitating the movement of an astounding 90% of all consumed goods. Yet, amidst its vital role, the sector grapples with unpredictability, often manifested in fluctuating freight prices that catch customers off guard.

Various economic and geopolitical factors, from sluggish growth to unforeseen events like the Suez Canal blockage and Red Sea conflicts, wield substantial influence over ocean freight rates. Recent incidents, such as the surge in pricing following Houthi attacks in the Red Sea, underscore the far-reaching repercussions of regional disruptions on a global scale.

While predictive analytics harnesses historical and real-time data to anticipate such disruptions, recent events like the Baltimore bridge collapse and the earthquake in Taiwan reveal the inherent limitations of predictability. The focus shifts from forecasting to crisis management, highlighting the need for a more agile approach.

Traditionally, freight rates have been dictated by customer demand, fuel costs, and vessel availability. However, the complexity introduced by global crises renders traditional methods obsolete. In this landscape of uncertainty, artificial intelligence (AI) emerges as a transformative force in mitigating the long-term impact of disruptions on ocean freight pricing.

Read also: Transforming Supply Chains: The Rise of Artificial Intelligence

AI offers several advantages in freight pricing, including real-time market monitoring, rapid response capabilities, and sophisticated decision-making algorithms. By continuously analyzing various data sources, AI systems enable shipping companies to swiftly adapt their strategies in response to changing shipping conditions, mitigating economic impacts effectively.

Furthermore, AI models demonstrate remarkable resilience even in the face of black swan events, enabling shipping companies to return to optimal selling rates up to 30% quicker than traditional systems. This agility translates into significant financial gains for freight forwarders, underscoring the value of advanced AI technologies in navigating unprecedented challenges.

The unparalleled data processing capabilities of AI pricing models provide a critical edge in high-pressure scenarios, where timely decision-making is paramount. Even in data-scarce environments, the best-in-class AI models can derive optimal freight pricing recommendations from minimal data points, ensuring robustness and reliability.

As the ocean freight industry embraces AI technologies, it charts a course towards greater resilience, efficiency, and stability in pricing dynamics. By harnessing the power of AI, shipping companies can navigate the seas of change with confidence, safeguarding global trade against the tides of uncertainty.

transportation supply chain odex portal

Navigating Digital Transformation: Insights from ODeX’s Ocean Freight Shipping Report

ODeX, a prominent provider of digital solutions for ocean freight shipping, has unveiled a comprehensive report shedding light on the state of digital transformation within the industry. Drawing from a wide-ranging survey conducted by ODeX, the report offers deep-seated insights into operational hurdles, the adoption of digital documentation, and the evolving landscape of maritime logistics.

The survey, encompassing responses from diverse industry professionals, uncovers pivotal findings:

– 75% of respondents encounter operational bottlenecks frequently or occasionally, with documentation issues highlighted by 50% as a major challenge.
– 60% of industry professionals are already embracing digital documentation or payment platforms, indicating a notable shift towards digital adoption.
– Nevertheless, 40% have yet to adopt these digital solutions, primarily citing concerns regarding data security, user adaptability, and implementation costs.
– A significant 70% underscore the utmost importance of grasping the shipping landscape and stakeholders for successful digital integration.

The report delineates detailed recommendations for tackling these challenges, stressing the necessity for enhanced digital documentation, user-friendly platforms, and collaborative industry endeavors.

Liji Nowal, CEO of ODeX, emphasizes the survey’s significance, stating, “The findings underscore the urgency for action within the ocean freight shipping industry. As we navigate the digital transformation journey, it’s evident that a deeper comprehension of the sector’s unique challenges and a united approach are imperative. At ODeX, we are dedicated to propelling this transformation forward, ensuring that digital solutions not only address prevailing challenges but also pave the path for a more efficient and resilient future.”

This report serves as an invaluable compass for stakeholders in ocean freight shipping, accentuating the pivotal role of digital solutions in surmounting operational hurdles and augmenting industry efficiency. ODeX’s commitment to spearheading this initiative is underscored by the survey, reflecting its dedication to guiding the maritime industry toward a more interconnected and digitally advanced era.

The complete report is accessible on the ODeX website, offering a roadmap for industry stakeholders navigating the intricacies of digital transformation in ocean freight shipping.

flights

Qatar Airways Cargo Relaunches Several Destinations this Summer

Qatar Airways Cargo reintroduced flights to Haneda, Nice, Manama and Sarajevo, while continuing to expand its Middle East operations

The world’s leading cargo carrier relaunched services to Tokyo’s Haneda Airport last week. The reintroduced passenger flights bring the total weekly tonnage available to and from Japan to 600 tons each way. General cargo makes up for the vast majority of exports from Tokyo, followed by vulnerable cargo and dangerous goods. As for imports, they consist of general cargo, fish, seafood, fruits and vegetables.

From 30th May, the carrier also commenced four weekly passenger Airbus A320 flights from Doha to Sarajevo with six tons of weekly cargo capacity. Commodities mainly consist of general cargo and also include vulnerable cargo and pharmaceuticals.

The carrier relaunched passenger flights to Nice earlier on 9 May with exports comprising of general cargo, dangerous goods, pharmaceuticals while on the imports front, general cargo, dangerous goods, vulnerable cargo and other types of cargo are flown in to Nice. With freighters to Lyon and Paris and belly-hold flights to Nice and Paris, the cargo carrier’s weekly cargo capacity to and from France increases to 1,100 tons each way.

Daily flights to Bahrain started on 25 May, providing cargo customers with 11 tons of cargo space on the A320 passenger flights each week, each way. In addition, Qatar Airways Cargo has also expanded its network in the Middle East, effective May. The airline introduced two Boeing 777 freighters to Dammam, bringing the weekly tonnage to 350 tons each way. A new freighter frequency was also introduced to Riyadh, bringing the total frequencies to five Boeing 777 freighters each week on top of the quadruple daily passenger flights, providing over 850 tons of cargo capacity each way to and from Riyadh.

The world’s leading air cargo carrier recently launched its first hub in Kigali in partnership with Rwandair, where customers of both airlines benefit from enhanced service levels, cost synergies and from a reliable intra-African network through Kigali.

Qatar Airways Cargo won three prestigious awards in May, Cargo Airline of the Year and Air Cargo Industry Marketing & Promotional Campaign at the 2023 Air Cargo Week World Air Cargo Awards and Sustainable Cargo Airline of the Year 2023 by Freight Week.

transfix container ocean freight ASIA mycarrierpackets

Sailing the Seas or Soaring the Skies: A Comprehensive Look at Ocean Freight vs Air Freight Shipping for Your Business

Complexity and congestion in the supply chain are at an all-time high today. Therefore, it is essential for a company’s success to choose the most suitable freight alternative. Air freight and ocean freight are both viable options for overseas shipments. They each have their benefits and drawbacks. Your company’s specific circumstances and goals will determine the most effective freight strategy.

Freight is the single most considerable expense in most supply chains. Businesses must consider how freight and its hidden fees affect their bottom line. Importers in the modern, globalized economy should try to save on both transportation costs and delivery times as much as possible. Which mode of transportation should a company choose when there are so many to pick from, including the air, road, train, and sea? Keep reading to find out what ocean freight and air freight shipping are and the top advantages of each.

Ocean Freight: What Is It And What Are Its Advantages?

Scheduling the transport of cargo through ships is referred to as sea freight forwarding. The freight company packs the items into metal containers and loads them onto the ship. The average container capacity of a cargo ship is about 18,000. This alone makes ocean transport a cost-effective method to ship colossal cargo.

  • Ocean Freight Is Often The Most Cost-Effective Option Compared To Air Freight 

Budget constraints are one of the primary drivers for SMBs to seek ocean freight transport services. For long-distance shipments, air freight could be costly. In most cases, shipping by the ocean is the most cost-effective method for transporting heavier items across distant locations.

  • Ocean Freight Are The Ideal Choice For Large Cargo

Shipment by air is too costly for heavy cargo. Thus most people choose ocean freight instead. Ocean freight rates can be influenced by weight, but shipping container sizes mostly determine how much it costs. Standard container lengths range from 20 feet to 40 feet to 45 feet. They can only hold a certain amount of weight due to the containers’ specific dimensions.

  • Little Impact On The Environment And Lower Carbon Footprint

The environmental effect of freight shipping is a valid concern for many company owners. Especially in the future, strict regulations may be required to control the impact of freight transportation on environmental issues, particularly when it comes to the use of roads and airplanes. In contrast to the other two options, ocean freight has a far less carbon imprint.

Air Freight: What Is It And What Are Its Advantages?

Parcel delivery through air freight is transporting items via an air transport service. Small, medium, and big companies who want to stay competitive can consider air freight delivery an excellent choice for shipment. This shipping mode not only delivers reliable delivery lead times but also simplifies the process to increase consumer loyalty. When importing or exporting items, it is necessary to consider each country’s legal and compliance requirements. PEO services can handle these aspects for your business. Professional global PEOs can manage the paperwork and procedures associated with the overseas shipment.

  • The Quickest Shipping Option

Congestion at ports is a significant problem that has made sea freight extremely slow in recent years. Air freight services are the most incredible option if you need to get your shipment to its final destination quickly. This is a significant time saver compared to going by the ocean or road. 

  • Strong Safety Measures Taken

Security concerns are pretty strict in the airline sector. This means it may prevent theft and damage from occurring while in transit. Cargo handling at the airport follows a set of specific protocols. The airport authority strictly enforces these regulations at all times.

  • Transport Status Monitoring Capacity

Many businesses specializing in shipping goods by air will allow you to keep tabs on your shipment via a web-based tracking system. As a result, you can track shipments from departure to their delivery. 

The Bottom Line

Matching your company’s needs with the benefits of air or ocean freight can help you make the best decision. Your attention can be divided between the two alternatives. In this instance, you should consider the benefits and drawbacks of each option to choose the one that best fits your requirements.

 

freight containers

Fluctuating Freight Rates Supply Chain’s Biggest Worry Over Next Five Years

Inflation, fluctuating freight rates and geopolitical tensions are set to dominate concerns for the global supply chain over the next five years, according to a DP World study released today.

From a DP World-commissioned survey with freight forwarders in October, some 63 percent of the respondents said inflation is a main concern, while 56 percent cited geopolitical tensions as another major cause of concern.

The study found that concerns freight forwarders are currently experiencing include rising and unpredictable freight rates, with 80 percent highlighting this as the biggest worry keeping them awake at night.

Sky-high freight rates driven by peaking demand due to the pandemic have led to unprecedented circumstances for shippers. Most recently, carrier Hapag-Lloyd concluded the first nine months of 2022 posting a group profit of $14.7 billion, owing profits to the freight rates.

Geopolitical disruption such as that of the Russia-Ukraine conflict is impacting all areas of the supply chain. Loss of trade with Russia has driven down the Port of Rotterdam’s container segment output significantly this year.

Around 10 percent of the respondents said they had changed the markets they do business in due to uncertainty.

Additionally, two-thirds (66 percent) of freight forwarders said it is ‘impossible to say’ when economic disruptions will subside.

Nevertheless, 75 percent of the respondents said they expect technology to be a significant factor in easing the current supply chain woes.

READ: Global trade soars hitting record $7.7 trillion in 2022 first quarter

More than half (56 percent) believe digitalization will be the single biggest driver of efficiency, reducing bottlenecks and supporting the industry going forward. Half of the freight forwarders, however, said they are further behind on their company’s digital transformation journey than they had hoped.

The survey was carried out among 41 members of the Digital Freight Alliance (DFA), which was founded in 2020 by DP World as an independent association for freight forwarders providing web-based tools, networking and commercial opportunities for members across more than 190 countries.

The findings from the survey were showcased at the Global Freight Summit, a three-day Dubai conference. The event was inaugurated by Sheikh Ahmed bin Saeed Al Maktoum, President of the Dubai Civil Aviation Authority, Chairman and CEO of Emirates airline and Group and Chair of the World Logistics Passport (WLP) Global Steering Group, and attended by Sultan Ahmed Bin Sulayem, Group Chairman and CEO of DP World, as well as members from the DFA.

“Global supply chains are significantly impacted by the pandemic, geopolitical tensions and the looming threat of the global climate change crisis. In fact, these challenges have demonstrated that many parts of the global supply chain infrastructure are fragile,” said Bin Sulayem.

Earlier this month DP World teamed up with Emirates Development Bank (EDB), signing a Memorandum of Understanding (MoU) to provide small and medium-sized enterprises (SMEs) access to trade financing through DP World’s trade finance platform.

total spot

Shipping Demand is on the Decline – Freight Rates are Reacting

Back in February 2022, it was not uncommon for importers to sign yearly (or longer) freight contracts. Two years of supply-chain disruptions and delays will do that. Large importers like Amazon.com and Walmart especially were placing a premium on predictability and reliability.

Their margins were generous enough to justify throwing their cards on the table in a push for more assuredness. Shipping liners held all the leverage and that’s some real leverage considering the top five operators control roughly three-quarters of the container capacity. 

Yet, just five months later, companies are in a frenzy to renegotiate those agreements. Consumer demand has shifted dramatically and is currently creeping to a crawl. Many freight specialists point to lower rates appearing first in spot markets, complementing the decrease in longer-term contract rates. Now, a reduction in transport costs is good news in many respects for retailers and manufacturers alike. But, shippers are still paying much more than they did pre-Covid. 

The overall environment is now trending in the favor of importers. Flexport, a San Francisco-based freight forwarder, noted that more shippers are foregoing contract rates and moving towards the spot market in a move to secure lower rates. Between June 2021 and June 2022, long-term rates from China to the US Pacific Coast nearly tripled. By March of 2022, the short-term rates had begun to decline and in June they descended below long-term rates.

In May of this year, consumer goods imports plummeted by roughly $1.5 billion. Americans, according to the Commerce Department, have been cutting back big on big yearly purchases such as televisions and furniture. To compound matters, trucking is also witnessing a softening of demand. Yet, interestingly enough, truck rates have been falling mainly due to a shift from the spot market toward contract rates that are longer-term in nature. Spot rates in the trucking sector sunk 22% over the first half of the year. The most commonly used type of trucking, dry van, registered an average contract rate in June of $2.93 per mile. This was 17 cents higher than the rate to move a load on the spot market. 

Contract rates will likely continue to decline as spot rates fall. Shippers will benefit, however, only if the price of diesel also falls. It doesn’t matter if you get a $2 per hour raise if inflation is costing you $4.   

 

goods

Advantages of Air Freight vs Ocean Freight

When it comes to shipping goods globally, there are two main freight transportation types: air freight and ocean freight.

Both have their own unique advantages and disadvantages, so it can be difficult to decide which is the best option for your business.

In this blog post, we will discuss the pros and cons of both air freight and ocean freight, so that you can make an informed decision about which type of shipping is best for your company.

Advantages of Air Freight

Planes are able to go hundreds of miles an hour in a straight line, so the travel time for your goods is going to be significantly shorter than it would be if you were shipping by cargo ship.

If you need your goods to arrive at their destination quickly, then air freight is the way to go.

In addition, planes typically fly directly from point A to point B, so there are no stops along the way (unlike ships, which often have to make several stops at different ports). This means that your goods are less likely to be damaged or lost in transit.

Another advantage of air freight is that it is not affected by weather conditions as much as ocean freight. Ships can be delayed for days or even weeks due to bad weather, but planes will almost always be able to take off and land regardless of the weather.

Disadvantages of Air Freight

The biggest disadvantage of air freight is that it is much more expensive than ocean freight. If you are shipping a large number of goods, then the cost of air freight can quickly become prohibitive.

In addition, there are weight and size restrictions on what can be shipped by air, so if you are shipping large or heavy items, you may need to use ocean freight instead.

Another disadvantage of air freight is that it has a larger carbon footprint than ocean freight. If you are shipping goods internationally, you will need to take this into consideration if your
company is trying to position itself as an economic and environmentally responsible organization.

Advantages of Ocean Freight

When choosing ocean freight, you will be able to take advantage of its low cost. Shipping by boat is much cheaper than shipping by plane, so if you are shipping a large number of goods, it will be more affordable to use ocean freight.

In addition, ocean freight is not as affected by weight and size restrictions as air freight. This means that you can ship larger and heavier items by ocean freight without having to worry about
your cargo being charged extra fees.

Another advantage of ocean freight is that it has a smaller carbon footprint than air freight. If you are concerned about the environmental impact of your shipping, then ocean freight is the more eco-friendly option.

Disadvantages of Ocean Freight

One of the main disadvantages of ocean freight is that it takes much longer for your goods to reach their destination. If you need your goods to arrive quickly, then you should use air freight
instead.

In addition, ocean freight can have several weather delays depending on how bad the conditions are. If your cargo is time sensitive, you may not want to use ocean freight for your
shipping.

Another disadvantage of ocean freight is the number of stops ships tend to make before reaching the final port. Not only does this lead to a longer shipping time, but it could increase the possibility of your goods being lost while in transit.

If you prefer to minimize some of the risks involved with shipping, you may want to stick with air freight.

Maps Can Help You Choose

Integrating a map API into your business is a good idea if you are going to be shipping internationally. Using a map API, you’ll be able to get live updates on ship and plane locations, as well as estimated arrival times.

This will help you make more informed decisions about which freight shipping method to use for your business and which one is saving you the most money. You can even use the data from your map’s API to ensure your shipping carriers are using the most efficient route.
Since the API integrates into your entire system, you can view it using any browser, giving you more information no matter where you are.

Choosing Air Freight or Ocean Freight

If you need your packages to be delivered quickly and aren’t worried about price, then air freight is the best option for you. However, if you are shipping a large number of goods or heavy items, ocean freight will be the more affordable option. Each method has its advantages and disadvantages so the decision will ultimately depend on your business’ needs.

 

ports

EXPANSION ALONE MAY NOT BE ENOUGH AS BUSY PORTS EYE SMARTER GROWTH

A sharp increase in container cargo in the second half of 2020 and into the early months of this year has proven to be a pleasant surprise for several U.S. ports. But even prior to the impacts of COVID-19 on container cargo, many ports were already dealing with substantial growth and operational success. “Deeper, wider, bigger” has been the theme as ports and terminals spent and continue to spend billions of dollars to capture greater market share.

So, is “deeper, wider, bigger” the secret to growing the container business?

“There really is no secret,” says Joe Harris, spokesman for the Port of Virginia, who adds that his home facility “offers a modern, technologically advanced port run by a team of experienced professionals. We focus on customer service, efficiency and providing a predictable experience to our customers–the ocean carriers–and the cargo owners choosing to move their goods over our terminals. Those things, combined with a long-term plan of strategic infrastructure investments that is shared with the port’s users, are vital to our future.” 

From 2014 through 2024, the Port of Virginia will have invested nearly $1.5 billion in modernization. This includes expanding annual TEU (twenty-foot equivalent units) throughput capacity by 1 million units and deepening and widening commercial channels to make Virginia the deepest port on the U.S. East Coast. 

“The strategy is to leverage these investments to grow volume, expand market share, build our competitiveness and continue to be a catalyst for economic investment and job creation in Virginia for decades to come,” Harris said. 

Supporting the strategy is a team of professionals across the world, including the U.S., representing the port. These professionals are continually engaged in driving business to Virginia, according to Harris. “They are supported by a business analytics team that is helping to identify emerging markets, new industries, expansion among beneficial cargo owners and ocean carriers,” he adds. 

Port Tampa Bay has also witnessed a strong uptick in container cargo.

“Our container business increased by 33 percent last fiscal year and is up another 43 percent in the most recent quarter,” says Wade Elliott, the port’s vice president of Business Development. “The primary driver is the continued rapid growth of the Florida market, which was the second-fastest-growing state by population last year.”

The Tampa Bay/Orlando I-4 Corridor region, home to Florida’s largest concentration of distribution centers with close to 400-million square feet of space, “was already one of the hottest industrial real estate markets in the U.S. pre-COVID-19,” Elliott notes.

“New container service connections from Asia, and more recently Mexico, have helped facilitate this increased business,” he says, “and the port’s close proximity to these distribution centers allows importers and exporters to make multiple round-trip deliveries per day, resulting in significant savings in trucking and supply chain costs.”

To keep pace with the growth, there is a need to develop more infrastructure.

“Port Tampa Bay recently completed 25 acres of additional paved storage, bringing the total container terminal footprint to 67 acres with plans to add another 30 acres,” Elliott said. “Work has also begun on a third berth which will bring the total to over 4,500 linear feet, allowing three large ships to be worked at the same time. Construction is also about to start on a new container gate complex and the bid process has begun to acquire two, additional gantry cranes,” Elliott concluded.

The Jacksonville Port Authority (JAXPORT) saw container volumes rebound up by 5 percent year-to-date in FY21 (Fiscal Year) which began in October. Nearly 353,400 TEUs moved through JAXPORT during the first quarter of FY21, making it one of the port’s busiest first quarters on record for container volumes.

“Location and efficiency are both central to JAXPORT’s success throughout our various trade lanes and business lines,” says Robert Peek, JAXPORT’s general manager of Business Development. “JAXPORT is located in the heart of the southeast U.S. and offers fast access to 70 million consumers within a day’s drive.”

Historically, Puerto Rico has been JAXPORT’s largest trading partner, accounting for about half of all JAXPORT’s containerized volumes, but Jacksonville has been actively pursuing new business.

“Today, container shipping lines service additional Caribbean islands through JAXPORT, as well as Central and South America,” Peek added. “JAXPORT also offers robust container vessel service with China and countries throughout Asia.” 

With the benefits of congestion-free terminals and infrastructure enhancements, anchored by a harbor deepening project, JAXPORT will “continue to work to grow our offerings in the trans-Atlantic and African trade lanes as well,” Peek said.

With Jacksonville also in the “deeper, wider, bigger” mode, its infrastructure projects will support its growth plans.

“The federal project to deepen the Jacksonville shipping channel to 47 feet from its current depth of 40 feet will be completed through our Blount Island Marine Terminal in 2022,” Peek said. “Harbor deepening is JAXPORT’s single biggest growth initiative and positions us as a port of choice for the increasingly larger container ships calling the U.S. East Coast.”

More than $200 million in terminal enhancements are also underway at the SSA Jacksonville Container Terminal at Blount Island. “These enhancements include phased yard improvements to allow the facility to accommodate more containers, berth enhancements to enable the terminal to simultaneously accommodate two post-Panamax vessels and the addition of three additional state-of-the-art, eco-friendly container cranes, bringing the facility’s total to six,” Peek added.

California’s Port of Long Beach is a leading gateway on America’s most important trade route, the trans-Pacific, and it offers the fastest and shortest route between Asia and the United States.

“We offer more connections to interstate highways and national rail lines, along with access to 2 billion square feet of warehouse space in the region,” says port Executive Director Mario Cordero.

In 2020, Long Beach handled more than 8.1 million TEUs, the best year in its history “and to start off 2021, we’ve had our best January and February on record,” Cordero adds.

The port sees growth opportunities in markets such as Southeast Asia as well as Latin America, and eventually Long Beach would also like to see a resurgence in U.S. exports, Cordero says.

Capital improvement projects are crucial to maintaining successful and growing operations. Cordero says the port is completing “the world’s most advanced container terminal at Middle Harbor,” known as Long Beach Container Terminal.

Slated for completion later this year, this automated terminal will have 14 ship-to-shore, dual-lift cranes. Six of the cranes will be big enough to handle a 22,000 TEU ship. There will be 70 stacking cranes and 72 automated guided vehicles (AGV) at full build-out, adding an annual capacity of 3.3 million TEUs.

“In 2021, planned capital expenditures of $379 million account for 58 percent of our spending,” Cordero says. “Over the next 10 years, the port will invest $1.7 billion in infrastructure and $1 billion of that is for the development of the port’s on-dock rail capacity.”

Not surprisingly, the growth of the container business has spurred innovation in other aspects of the industry. 

California-based Blume Global, for example, has co-developed with Fenix Marine Services (FMS), a marine terminal operator at the Port of Los Angeles, a technology platform to add efficiencies to container movement. 

“This service doesn’t simply help the terminal operate more efficiently, the entire port ecosystem (ocean carrier, rail carriers, motor carriers, labor interests, logistics service providers, beneficial cargo owners) gains an advantage,” says Lincoln Pei, account manager, Blume Global. “When containers flow quickly through port complexes and marine terminals, vessel berth and rail car capacity are optimized, gate transactions are timelier, and dray carrier wait times are reduced, among other improvements,” he says.