Starting off with some positive news—for some, anyway—the transatlantic east-west trade route is seeing huge profits when compared to the transpacific. The reason? Spot earnings on the transpacific have been tanking for the last month.
An Alphaliner report shares the following details. Spot rate earnings from Shanghai to California have dropped below 60 cents per nautical mile, which is half of July earnings. At the time of the report, earnings on the Shanghai to New York and Shanghai to Rotterdam routes were 73 cents. A sharp contrast to the Rotterdam to New York transatlantic route, which had earnings of 217.9 cents per nautical mile.
Next up, the FMC has issued a notice of proposed rulemaking against ocean carriers. Their intent is to change the way ocean carriers have prioritized business to date. Especially over the last several years as they’ve cozied up with the more lucrative import rates offered by east-east trade, leaving exporters and their more reasonable rates and services without room on their vessels.
The FMC wants carriers to justify and certify vessel space allocations to make things fair for all.
Will Willie Adams, the president of the International Longshore and Warehouse Union, iron out a deal with dockworkers at the ports of Los Angeles and Long Beach?
Despite the fact that some say current work disruptions haven’t affected coastwide operations, there is a general acceptance that things will deteriorate as negotiations drag on and perhaps break down. In preparation, many of America’s larger importers have started to shift inbound goods from the West Coast.
In an interview with Bloomberg News, WTO Director-General Ngozi Okonjo-Iweala shared some less than positive insights into the future of trade. In his words, the outlook for global trade is “not promising.” In part, this is due to the risky condition of the world’s economy, Russia’s ongoing war with Ukraine, shipping bottlenecks, China’s Zero COVID policy, and extreme weather events.
And finally, those in procurement are struggling—just like everyone else in the industry. On top of challenges like the war, labor issues, the economy, and more, there are some new policies and regulations—either proposed or already in place—that are making things even more challenging.
Specifically, policies that will force everyone to collect and report data on Scope 3 emissions that are tied to the supply chain. Doing so will be very costly—and so will the fines or penalties for non-compliance.