U.S. Election
With 10 days to go before the election, the Wall Street Journal (WSJ), New York Times, and most other media outlets are reporting that Trump is likely to win. With the last New York Times poll showing a tie in the national polls, where Harris had a steady lead, and a series of polls showing Trump with a narrow lead in seven key battleground states, financial markets are riding the so-called “red wave” of Trump's victory. The WSJ reports that investors are increasingly buying stocks, the dollar, and bonds in anticipation of a Trump victory. In response, Vice President Harris's campaign is launching a full-scale campaign for former President Obama, utilizing twice as much money as Trump's campaign to target the battleground states.
Maritime Cargo Market Trends
ㅇ North America Vessel, Rail Dwell time (Week 43 / Flexport)
=> Midwest Rail congestion intensifies
Rail delays are severe due to the East and Gulf port union (IRA) strike, the aftermath of back-to-back hurricanes, and the surge in LA/LGB port handling volumes.
(Port of LA, the largest port in the U.S., handled 954,706 TEUs in September, bringing total Q3 volumes to 2.85 million TEUs, up 27% year-over-year)
As a result, carriers are either not accepting rail bookings at all or are limiting the number of bookings on PS routes from the Midwest, including CHI, to LA. The PN Route to the Port of Tacoma in Seattle in the Northwest US is being utilized as an alternative route, but delays are occurring for 1-2 weeks and recovery is expected to take 7-10 days.
ㅇ Market trend
[FEWB – Far East West Bound]
GRI announced for FAK cargoes on November 1 due to recovery in demand and solid shipments after Chinese National Day holiday. Price stability and Peak Season Surcharge (PSS) expected to remain unchanged through the first half of November
[TPEB – Trans Pacific East Bound]
Blank sailing reduces supply and demand pushes pre-GRI volumes on November 1, resulting in rapid bookings. 10 vessels are scheduled to be out of service in November, reducing supply by approximately 15-18%, and some carriers are considering reintroducing premium services that offer guaranteed booking and transportation for an additional $2,000 per container.
ㅇ Increased concerns regarding labor negotiations at US East and Gulf ports
As negotiations continue between the International Longshoremen's Association (ILA) and the U.S. Maritime Union (USMX) on a long-term contract, many experts are concerned that disagreements over port automation could lead to logistics disruptions. Even if the acrimonious standoff over automation does not lead to a second strike, the fear of a strike and the union's maneuvering to gain leverage in the negotiations could cause significant logistical disruptions as shippers, fearful of service disruptions, seek alternatives, including diversions to western ports.
Air Cargo Market Trends
ㅇ Airfreight Price Trends (From US)
Resumption of charter cargo flights from Asia following the end of China's National Day holiday significantly increased supply, returning to oversupply conditions and causing spot prices to plunge. However, Regular consolidated cargo prices, which are important to maintain service quality such as on-time performance and stable supply, remain unchanged.
Customs and other market conditions
ㅇ Amazon to suspend same-day delivery service in December
Amazon's same-day delivery service called “Amazon Today” will be mostly shut down on December 2, CNBC reported. This comes more than two years after Amazon began offering same-day delivery from select stores in the U.S. in August 2022, and in the meantime, the company has been expanding its same-day delivery service, continuing to add facilities focused on fast delivery as competition for delivery among retailers heats up. The suspension of same-day delivery is a major policy change for Amazon. The industry is interpreting this as Amazon being hit by the onslaught of Chinese e-tailers such as Temu and Shein.
ㅇ Canada to implement automatic payment system for duty & tax (10/21)
Canada Border Services Agency's (CBSA) Assessment and Revenue Management (CARM) system, a digital platform to calculate and pay duties and taxes on imported goods, has been completed and applied from October 21st.