Subscribe to our free, weekly email newsletter!


Shippers may expect subtle shift in ocean carrier deployments

By Patrick Burnson, Executive Editor
April 21, 2014

The newly created and expanded alliances of P3 and G6 will certainly review and revise port calls, but the shift in initial deployments will be subtle, says Neil Davidson, senior analyst of ports and terminals for Drewry Research.

“However, it is in the carrier’s best interest to serve as many ports directly as possible in order to offer the best service to cargo owners,” says Davidson.

Furthermore, Davidson says that carriers will still call on all the key ports where there’s a concentration of consumers. “So in this sense there may not be much change to the list of ports called. But bigger ships do mean reduced service frequency, or at least less port calls per year, leading to more peaking of port volumes.”

Davidson says that anticipation of a breakdown in dockside labor contracting on the U.S. West Coast should also be considered when discussing the state of the ports this year. “I imagine that most shippers, through past experience of similar issues, have contingency plans in place for diversions if necessary. Shippers will adopt a wait and see approach though,” he says.

Finally, Davidson adds that the impact of the expanded Panama Canal still remains to be seen. “East Coast U.S. ports are hoping to gain share from the West Coast ports, but they won’t give it up easily,” he notes. “Plus, it’s not just about port capacity, but also about inland and intermodal capacity.”

In addition, there are two key unknowns about the future, says Davidson. First, the level of the new Canal vessel tolls is yet to be determined, and we have yet to see how the U.S. and Canadian railroads will react to the expanded Canal.

“Both of these will have a big influence on which way cargo is routed,” says Davidson. “Most likely time sensitive cargoes will continue to move via the West Coast, but cost sensitive cargoes will be more tempted to use the Canal.”

About the Author

image
Patrick Burnson
Executive Editor

Patrick Burnson is executive editor for Logistics Management and Supply Chain Management Review magazines and web sites. Patrick is a widely-published writer and editor who has spent most of his career covering international trade, global logistics, and supply chain management. He lives and works in San Francisco, providing readers with a Pacific Rim perspective on industry trends and forecasts. You can reach him directly at .(JavaScript must be enabled to view this email address).


Subscribe to Logistics Management magazine

Subscribe today. It's FREE!
Get timely insider information that you can use to better manage your
entire logistics operation.
Start your FREE subscription today!

Recent Entries

Company says the Cloud offering allows customers to respond more quickly to new business opportunities, without significant upfront cost and implementation times.

As e-commerce continues to take a bigger piece of the holiday package delivery pie, it stands to reason that companies need to be proactive and prepared in order to deliver premium service during the busiest time of year, which is rapidly approaching. And that is exactly what transportation giants UPS and FedEx are doing this year. How are they doing it exactly? The primary step they are taking is to up their numbers of seasonal staffers.

A recent hearing of the Subcommittee on Coast Guard and Maritime Transportation suggests that the U.S. Merchant Marine industry may be poised for a major comeback.

Spot market freight volumes for the month of August remained elevated compared to seasonal norms, according to data issued this week Portland, Oregon-based freight marketplace platform and information provider DAT.

Factors such as rising freight rates, shrinking capacity, an increased desire for global supply chain visibility, have all worked together to drive the need for instituting a culture of continuous improvement in logistics operations and transportation management systems (TMS). To meet today's complex logistics challenges, managers are stepping into a more streamlined, automated approach to transportation management in order to function at optimal levels both domestically and internationally. Read the latest special report.

Article Topics

News · Ocean Cargo · Ocean Shipping · Seaports · All topics

Comments

Post a comment
Commenting is not available in this channel entry.


© Copyright 2013 Peerless Media LLC, a division of EH Publishing, Inc • 111 Speen Street, Ste 200, Framingham, MA 01701 USA