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Canada strikes disrupting billions in trade
Dockworker strikes at the ports of Vancouver and Prince Rupert are disrupting an estimated C$800 million in trade. That number represents 25% of Canada’s total traded goods each day, according to the waterfront employers’ group.
The strike by the ILWU Canada is now in its 11th day. As a result, roughly C$7.5 billion in Canadian imports and exports have been compromised.
Trans-Pacific carriers continue to divert ships from Vancouver and Prince Rupert to Seattle-Tacoma. As of Monday, at least six container ships had been diverted. However, the ILWU on the US West Coast refuses to unload Canadian containers. Therefore, the US-destined boxes are unloaded at Seattle-Tacoma and the others are sent to anchor outside Vancouver and Prince Rupert. 11 container ships were anchored outside Vancouver and four outside Prince Rupert as of Tuesday.
ILWU Canada has responded by citing a study that states that the elevated freight rates enjoyed by carriers in 2021 and 2022 and fee increases by terminal operators – not dockworkers’ wages – were stoking inflation.
BCMEA said the strike is mainly impacting the imports and exports of automotive parts, refrigerated food products, fertilizer, critical minerals, and commodities. The group noted that the strike has put up to 10 million pounds of Canadian blueberry exports at risk.
The two sides continue to disagree over maintenance jurisdiction. The union wants expand its jurisdiction over maintenance and repair work to areas not involving cargo-handling equipment. BCMEA said a revised proposal was made on Saturday. Additionally, the two sides discussed the maintenance issue on Monday night, but were unable to reach an agreement.
Prior NY-NJ empty container woes linked to complaint against Hapag-Lloyd
Fruit and vegetable importer Rahal International filed a complaint against Hapag-Lloyd claiming that the carrier failed to address a buildup of empty containers at the Port of NY and NJ. Rahal International says it faced import delays, fees, and cargo spoilage as a result of the buildup. The FMC complaint seeks $715,632 in damages from Hapag-Lloyd.
Rahal stated, “As a proximate result of the logistical paralysis Hapag created at the Port of New York and New Jersey, which precluded retrieval of loaded Hapag containers, Hapag charged unjust and unreasonable detention and/or demurrage charges for the newly arrived loaded containers.”
Ocean carriers have cleared out their empties after drawing attention from the FMC and facing an empty container storage fee. However, shippers were facing a much more chaotic situation two years ago.
Storage yard closure
As a historic container boom started hitting NY-NJ, a major storage yard for empties closed unexpectedly in March 2021. Ironbound Intermodal held up to 12,000 empty containers. Its customers included Hapag-Lloyd and ONE.
Starting in April 2021, the carrier started issuing notices to truckers that empties could not be returned to the port. Therefore, truckers were forced to hold on to the empties or deliver them to locations far outside the port district.
In May 2021, Hapag secured more empty container storage at the Columbia Group yard. By June, Hapag started offering concessions to trucks, such as extending return times and offering $250 wait fees to truckers dealing with long lines at the port.
However, Rahal says these measures did not stem the delays a year later. In one instance, the shipper was not able to retrieve full containers of apple juice for 24 to 32 days. The shipper said it incurred detention and demurrage charges on the containers, resulting in $298,911 in fees. Additionally, the apple juice spoiled. Therefore, Rahal is seeking another $198,000 in damages.
About O’Neill Logistics
O’Neill Logistics is a leading third party logistics provider. We operate in California, Savannah, New Jersey. We service many verticals including Garments, Fashion Accessories, Footwear, Furniture, Home Goods, & Electronics. Additionally, we offer omni-channel distribution and all value-added services. Lastly, we focus on retail “drop shipment” fulfillment and item-level fulfillment services with same-day service offerings.
O’Neill Logistics has over 2 million square feet of state-of-the-art facilities. Additionally, we offer dray services to support the warehouses and provide distribution to retailers and wholesalers. Our reliable 3PL platform combines sophisticated technology with robust, flexible processing designs and speed-to-market gateway models.
Lastly, we aim to simplify your supply chain. We deliver exceptional service and can optimize your operational performance. Therefore, we aim to build, protect and foster strong business partnerships.
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