News / Shippers scrambling for alternatives as box lines divert from closed ports

Picture: TikTok

Video footage of the 4,300 teu MSC Arushi R (pictured) departing Houston yesterday, sparsely loaded with just a few containers, could become one of the defining images of the first day of the ILA’s strike.

The vessel is deployed on MSC’s transatlantic North Europe-Mexico service, which does not normally feature a call in the US. However, the carrier appears to have tried to make a last-minute stop, before the midnight strike deadline, to pick up exports before adding new calls at Felixstowe and Le Havre on its return to Europe.

However, the options for ships are limited, although forwarders are advising customers to re-route, or to consider airfreight.

Scan Global Logistics told customers it expected US export bookings via the east and Gulf coasts to be suspended, but cargo able to move via west coast or Canadian gateways would continue to be accepted.

It said any new bookings should be for the west coast of the US or Canada, including Halifax in the east, and then moved overland. It also suggested customers considered Mexican routings via Vera Cruz and Lazaro Cardenas.

A Loadstar analysis of the eeSea liner database’s forthcoming US east and Gulf coast vessel calls shows a number of call omissions, with vessels either slow-steaming to the closed ports, at anchor, or returning to non-US ports.

For example, the 11,850 teu Ever Feat, deployed on the Ocean Alliance’s AWE5 Asia-USEC service, omitted its call at Baltimore today and is heading straight back to the Vietnamese port of Cai Mep.

The 5,000 teu MSC Matilde V, on MSC’s standalone Med-US service, is to omit its call at Boston and is currently moored in the western Mediterranean.

The 6,700 teu Porto Cheli, operated by Maersk Line on the 2M’s TA6/Medgulf service, has omitted calls at Miami and the Bahamas transhipment hub of Freeport and is now slow-steaming – AIS data shows it travelling at 1.2 knots – to its next port of call, Mexico’s Veracruz.

The Loadstar has so far counted at least another 10 containerships that were due to call at affected ports and have notified upcoming omissions, and it is certain that this number will rapidly grow the longer the strike continues.

FourKites said west coast ports had already started feeling the impact, adding: “Long Beach and Los Angeles ports had reported an 18% increase in volume last month.”

Stephanie Loomis, head of ocean freight, North America, for Rhenus, says on today’s Loadstar Deep Dive Strike Podcast that ports and terminals had extended their hours in the past week and that diversions had already begun.

“Communications have been flying like mad from the carriers and the forwarders and the ports to collect your cargo as early as possible. We’ve already seen some carriers make some diversions to different ports. But lines have been long, truckers have been stressed. It’s certainly been a challenge.”

Ms Loomis added that transhipment would become key. She said: “Many of us have lined up transhipping options … so being able to collect the containers at a different port. But I think transhipment is going to explode again, depending on how long this lasts.”

She explained that with limited rail options, especially on the east coast, trucking costs would rise.

And she added: “It’s certainly looking like a shit show, or a perfect storm, or whatever stereotypical comment you want to use. And yes, because of the strike in Montreal, contingency plans to Canada are now off the table in some regard.”

The National Retail Federation’s VP for supply chain and custom, Jon Gold, said US retailers had already been working to mitigate the impact of the strike by bringing in products earlier, or shifting cargo to the west coast.

“But even having taken those steps, there are significant concerns that a strike of any length could have an impact on getting product to the consumer,” he added, pointing in particular to food stuffs.

He said: “Any time you have a shutdown, there are cost implications. You’re going to see, unfortunately, increased transportation costs, increased warehousing costs.”

Airfreight is an alternative, but again has limitations.

Peter Sand, chief analyst for Xeneta, told The Loadstar Podcast: “If we focus on the air cargo transatlantic market as a substitute … it’s no real substitute, given the amounts of volume, the sheer weight of those goods. You can probably fit 10 boxes of weight into one freighter, and there you go, 400 tons. So there is no alternative.”

Data company Vizion said volumes had already decreased significantly at the affected ports, with the weekly average in July and August at 97,000 teu falling to 14,895 teu in the week of 22 September.

It said the affected ports accounted for 55% of US imports and 71% of exports. Walmart relies on Atlantic and Gulf coast ports for 86% of its imports, while just over half of home furnishings come in that way.

Also affected are exported goods like plastics (80% of all US product shipped out goes through the ports), wood pulp products (72%) and meat products (77%).