'Another nail in the coffin' – congestion on Canada's west coast

© Elena Vlasova

The deteriorative effects of the latest ILWU strikes on the transpacific tradelane are clearly visible, as the eeSea team tracks the live progression of vessel delays and omissions across the ports of Vancouver and Prince Rupert.

Impacts on individual vessels waiting outside Vancouver were seen as early as Friday and, as of Monday morning, there were at least five waiting outside of the port, with their immediate ETAs pushed back by an additional two to three days since the start of the weekend. That number increased to 11 vessels waiting in under 24 hours; bringing the overall congestion rate yesterday to over 90%, up from 71% Monday.

Yesterday, there was still one vessel waiting outside Rupert for over 48 hours and none in port; topping out the congestion rate at 100%.

Today’s outlook shows us that the number of vessels actively waiting in Vancouver has dropped back to six, bringing congestion down to 75%, but the previous vessels certainly haven’t gone to berth. A number are steaming outside the confines of the anchorage area or contemplating port swaps in the interim; there are currently eight vessels steaming towards Vancouver.

As for Rupert today, there are eight vessels steaming towards the port, one still waiting and, surprisingly, one in port. Why two vessels have been able to dock at Vancouver and Rupert respectively during the course of the strike is yet to be revealed to our analysts.

While tracking these delays can provide a play-by-play on the ground, forecasting efforts are also under way for predicting impact in the long weeks. As we well know in post-pandemic times, blanket delays across major economic hubs can cause ripple effects in later vessel arrivals into the first discharge port and succeeding ports, as well as informing carriers’ operational strategies in the following months. Diversions, port swaps, omissions, slot reassignments and even blank sailings are tactics that can potentially improve schedule reliability in the midst of a crisis.

Unfortunately, a good number of these spell a loss for Canadian stakeholders. As of today, there are no signs of diversions, but one confirmed port swap as well as one omission. A vessel that was previously due on 30 June chose to visit Seattle while it waited out the line-up, making it the first official port swap on our list. There is another vessel that appears to be making the same play, having waited for two days outside Vancouver it is now steaming towards Seattle. However, in this case, it has decided to omit any follow-up call to Vancouver.

Finally, a third vessel appears to be waiting outside Seattle and may result in another confirmed omission, as there are no longer signs of its ETA on the Canadian terminal schedules. If congestion remains above 50% well into next week, we could expect to see a dozen or more vessels moving from July into August and maybe even several omissions.

With these events coming on the tails of a short-lived but significant strike in June that impacted the ports of Oakland and Tacoma even more than Los Angeles and Long Beach – and continues to do so – it is important to give equal weight to the potential long-term economic impacts on the Canadian west coast.

With recent capacity losses and historically low rates, the transpacific trade has already seen unprecedented struggles in what should be the most productive quarter of the year. Fears are that the immediate impacts may, in fact, be more manageable than the broader economic fallout all the way into 2024. Whether or not the ongoing negotiations make headway sooner rather than later, this could prove to be another nail in the coffin for a less than ideal end of the year.

Please click on the charts to expand.

This article was written by Destine Ozuygur, head of operations, eeSea.