ITS Logistics Issues March US Port/Rail Ramp Freight Index

Additionally, it said, equipment availability for exports is still an issue affecting individual ocean carrier lines throughout North America.

These findings are part of the Nevada-based third-party logistics (3PL) firm’s US Port/Rail Ramp Freight Index for March. Each month, ITS Logistics releases an index forecasting port container and dray operations for the Pacific, Atlantic and Gulf regions. Ocean and domestic container rail ramp operations are also highlighted in the index for both the West and East inland regions.

“Should rates begin to increase” for dray and rail capacity, ITS Logistics Vice President of Global Supply Chain Paul Brashier said, “this may affect truckers’ ability to honor dedicated pricing and tender acceptance in the second quarter. It could be alleviated as more volumes return to the U.S. East and Gulf coasts, now that labor strikes are no longer a concern. With the return of volumes back to the U.S. East and Gulf coasts, there has been a tightening of capacity and terminal congestion at the major gateways of New York/New Jersey, Norfolk, Savannah, and Houston.”

The International Longshoremen’s Association on March 11 signed an extension to its Master Contract with the United States Maritime Alliance. This agreement is set to last until Sept. 30, 2030, and includes workforce protection guidelines that require a detailed explanation of the technology that will be used and its effects on capacity and efficiency. ITS Logistics noted that the agreement also requires determination on the manning for new equipment to be included with stipulations that new work created by the technology be identified with training included for workers.

However, the supply chain continues to experience challenges despite this new agreement, according to ITS Logistics. A lingering concern for exporters this year, it said, is equipment availability.

What is driving the equipment availability challenge? Primarily “equipment imbalance and rail operations,” reported Brashier, who noted that ITS is “closely monitoring” it.

“Rail operations are seeing similar sporadic challenges regionally,” Brashier said. “LA/Long Beach IPI dwell remains high for imports moving east. That, combined with rail transit delay and lower inland transportation costs, are pushing some shippers to move imports back to the ports on the East Coast and draying inland to avoid IPI legs.”

According to ITS Logistics, import volumes have begun redistributing from the West back to East and Gulf coast ports, as concerns over labor strikes ease. But it noted that the United States Trade Representative’s (USTR) recent proposal targeting Chinese vessels threatens to disrupt U.S. port operations once again. “Announced in late January, the proposal includes fees targeting Chinese vessel operators, Chinese-built vessels, and operators with a certain percentage of vessels ordered from Chinese shipyards,” ITS Logistics reported. “Research from the World Shipping Council (WSC) has found that the proposal could add up to $3.5 million in fees per individual port call to 98% of vessels entering the U.S. The WSC notes that ocean carriers have already indicated they may eliminate service to smaller ports to avoid these costs—a move that would severely impact regional logistics ecosystems and exacerbate congestion at major North American ports.”

Further Reading:

• ITS Logistics Releases February Supply Chain Report
• Strike Averted, Again: USMX, ILA Reach Tentative Agreement
• ITS Logistics Releases February US Port/Rail Ramp Freight Index
• ITS Logistics Releases January Supply Chain Report
• ITS Logistics: U.S. West Coast Ports Experience ‘Significant Import Volumes Amid Fears of January ILA Strike’