Update on BC Flooding

Now that it seems like the worst is behind us, repairs and recovery efforts are underway in BC. On Monday, CN & CP notified customers that its mainline between Kamloops and Vancouver was reopening. This would allow certain gates across Canada and the US to accept freight bound for the Port of Vancouver again.

Over the road shipments had a similar level of positive news, with Highway 3 reopening quickly after the flood subsided, though only for essential travel. The BC government has given no timeline for when non-essential travel will be allowed on the route. Instead they have projected that the other major highway affected by the storms, Highway 5, the Coquihalla Highway, will not be reopening until late January.

From a supply chain perspective, the country will likely be feeling the effects of the storm damage for weeks or months to come. Many experts are already predicting shortages of everything from turkey to alcohol across Canada for the remainder of this year and into next. 

LA/LB Delays

We’re pretty sure its time to start taking bets on whether or not the $100 a day waiting fees from the ports of Long Beach and Los Angeles were ever intended to be implemented. Our money is on NO. After delaying the fees for the fourth time, now till December 13th, it’s likely that we may never see the fees come into effect. Authorities rationalized the delay the same way they had explained the last three, saying that the mere threat of the fees has already had an impact on the number of containers sitting at the port.

Note: If the decline in slow-moving containers continues, we’ll need a fixed section in this newsletter to let you know fees are once again being delayed. 

More issues pertaining to West Coast ports were discussed in last weeks article – read more here.

Carrots vs Sticks to Move Containers

At the two busiest ports in North America, LA and Long Beach, a wide variety of measures are being taken to ease the congestion that has been plaguing the ports for the last few months. In late October the two ports announced that they would be instituting $100 a day, escalating late fees for containers waiting in the ports longer than necessary. Though the ports have now delayed the implementation of the fees for the third time, it seems as though the threat of the fees may have had a helping hand in reducing the number of containers waiting more than 13 days from 31,500 to 14,309 over the last month. Meanwhile, ocean carrier CMA CGM has taken a different approach to reducing the backlog. The company has announced a new incentive for importers in order to entice more early pickups. For containers moving into the LA and Long Beach ports, the company will now give a credit to importers who pick up their cargo within the first 8 days after arrival. Importers who pick up early during the week will receive $100, and those who pick up on nights or weekends will receive $200. With rates being as high as they are right now, its unclear if $100-200 will be enough to speed up the movement of containers, but the hope is that the credit will help get more cargo through the port quickly.  We’ll fill you in on more details next week’s post.

Port of Vancouver Strike Looms

As if there weren’t enough stress in B.C already, on Monday unions for two carriers serving the port of Vancouver issued a 72-hour strike notice. The union represents roughly 200 drivers, about 10% of the ports drivers, from two companies:  Aheer and Prudential Transportation. The drivers are threatening to strike after talks fell through with the two employers around implementing a collective agreement in line with the one reached by Harbor Link Transportation earlier this year. Though the unions are seeking “fairness across the sector” it’s unlikely that a full-on strike will occur. Given the dire situation already occurring at the port, it’s very likely that the government will step in to prevent any further delays. 

You can read more about the possible strike HERE.