August is typically the start of the peak global shipping season, and lingering supply chain snarls will still be a problem this year, according to CNBC.
Labor issues abound: Protests and ongoing labor disputes in California have caused container wait times to jump, while labor strikes and rail shutdowns have slowed many German ports, affecting the availability of European shipments. These slowdowns increase congestion across the entire system, leading to higher prices.
Shipping rates rise: A recent trend in lower ocean spot rates—“the one-time price a shipper can lock in for a specific shipment without a long-term contract”—has reversed, resulting in higher-than-average shipping costs.
- Ocean spot rates for the Europe-U.S. trade route are up to $8,423, while rates for the China-U.S. East Coast route are up to $10,000.
What we’re saying: “Seasonal ebb and flow are an annual occurrence in the shipping marketplace,” said NAM Director of Infrastructure, Innovation and Human Resources Policy Ben Siegrist.
- “The challenges this year are simply significantly worse as they’re piling onto a system experiencing excessive port congestion, extended container dwell times, exceedingly higher spot rates and labor strife.”
- “Manufacturers continue to urge swift resolution to pending labor negotiations in all sectors of the shipping industry and for sensible policy to address bottlenecks across the system.”