The following is an archived collection of our weekly insights throughout the month of June. Those who had signed up to our Interlog Insights newsletter received each week’s update to their inboxes on the original release date. If you would like to receive future insights through InterlogUSA’s weekly newsletter, sign up to join the email list!

This month's insights

Week 3 - Originally released June 21

Insight: East, Gulf Coast Talks Suspended By Union

Stakeholders of the East and Gulf transportation ecosystem have been subdued over the past several weeks, crossing their fingers that the boogeyman of labor disruption will not rear its ugly head come this fall. This of course is referring to an ultimatum from union leadership—if no agreement on a master contract is reached by Sep. 30, all rank-and-file dockworkers will strike along both coasts as soon as Oct. 1.

As the summer months leave a cushion for progress to be made, stakeholders—shippers, forwarders, intermediaries, truck brokers, trucking companies, equipment lessors, so on, so forth—have reserved a degree of faith that an agreement on a coastwide labor contact will be squared away prior to the Sep. 30 deadline, the same date in which the existing contract expires.

However, early last week, a certain development squeezed out most of the optimism, reminding everyone how contentious negotiations during contract cycles can be.

Talks paused over automation

In a June 10 news release, the International Longshoremen’s Association (ILA), the union representing 45,000 dockworkers along the East and Gulf coasts, announced it had since halted discussions with maritime employers towards a new coast-wide labor deal.

ILA reasons its decision as a result of discovering APM Terminals (terminal operator) and Maersk (ocean carrier) have used automated systems (in violation the current labor contract) to process trucks without unionized labor. This unsavory practice, in the eyes of the union, was first reported at the Gulf Coast’s Port of Mobile, but ILA claims similar uses of automation exist at other U.S. ports. APM Terminals denied the allegation.

“Here we go again!…This is a clear violation of our agreement with USMX [United States Maritime Alliance],” an ILA spokesperson stated, shared in the release.

The United States Maritime Alliance (USMX) is the representative party negotiating on behalf of maritime employers, which include port authorities, terminal operators, and ocean carriers.

“There’s no point trying to negotiate a new agreement with USMX when one of its major companies continues to violate our current agreement with the sole aim of eliminating ILA jobs through automation,” said International President Harold J. Daggett, who serves as chief negotiator for the union. ILA reiterated that it will not meet with USMX until this issue relating to automation is resolved.

Next to wages, automation is a qualm unionized labor has with the evolving landscape underway at ports. The issue presented itself as a major roadblock in separate contract negotiations for U.S. West Coast dockworkers which lingered between most of 2022 and the first half of 2023. While an agreement was eventually reached last June, the contract cycle was remarkably prolonged, lasting for over 13 months.

Unionized labor’s key concern over automation appears to be over how privatized operators and carriers are introducing it—which, in their eyes, has been aggressive. Union leaders essentially see the pursuit of automotive systems as a call-to-arms against the job security of their rank-and-file workers.

While automation is the albatross, other issues remain top priorities once negotiations resume. This includes ILA’s demand for salaries and other benefits that are as lucrative as the profits of USMX members, the union shared. While exact specifics behind the demands are not known at this time, the outcome of last year’s West Coast labor deal has likely set the bar of what the union, at the very least, would find acceptable.

Service perspective: Heed union’s strike warning

Between May 2022 and June 2023 during the West Coast contract negotiations, there were no instances of coast-wide strikes or mass lockouts. Throughout that exhaustive waiting period, anxious stakeholders routed discretionary cargo away towards the East and Gulf coasts. Even though no major disruption materialized, the routing strategy was a prudent precaution.

Looking back at the talks, neither ILWU (the union which represented West Coast dockworkers) nor maritime employers publicly waged threats of coast-wide chaos. They were not singing kumbaya either, but there was a sort of reverence in their approach. The talks were closed to the media with both parties seldom giving updates. They had their spats and hiccups, including a jurisdictional issue involving a Seattle terminal, but ultimately, there were few barbs and displays of messy rhetoric.

At the end of the day, shippers were right to be anxious and pragmatic to reroute in case some sort of disruption would have fomented. That said, it appears the boogeyman lurking on the West Coast turned out to only be a shadow, a figment of the imagination brought on by a lack of updates and closed media access.

This doesn’t seem to be the case this time around, however. The developing labor dispute which straddles the East and Gulf coasts is becoming quite demonstrative. ILA, unaffiliated with ILWU, may value a more public, abrasive, approach towards the path of a favorable coast-wide contract.

As ILA announced cancelation of talks, ILA’s Daggett said: “I guess [USMX] just thought our speeches at the convention were for show. Well, I hope they realize by now that every word spoken was real and sincere.”

It is uncertain when the talks will resume, and while the end of September remains a few months away, ILA is making it clear to USMX that it will keep its word. For East and Gulf coast shippers, it would be wise to heed these warnings and plan ahead in advance.

Interlog USA, through GEMCA, is the first and only to guarantee proactive communication and cost awareness on the 5 milestones that impact your specific business the most. 

Insight: B.C. Longshore Foreman Union Rejects BCMEA Proposed Offer

Negotiations between the B.C. Longshore Foreman and the BC Maritime Employers Association (BCMEA) have been ongoing since late May 2023.

The union recently voted (on June 15) and rejected a proposed offer from BCMEA, which included a 19.2 percent wage increase amongst other compensations.

The union said in a statement they are in the legal right to go on strike, but it’s important and worth noting that no issue of a 72-hour notice of a strike or lockout has been announced, nor have any labor disruptions occurred, as of June 15th. Additionally, British Columbia ports regular cargo and passenger operations have continued with no interruptions, per reports.

There’s a scheduled hearing starting July 2, with the Canada Industrial Relations Board, to discuss each party’s remaining complaints.

Interlog will continue to monitor this ongoing situation and provide updates when applicable. 

Week 2 - Originally released June 14

Insight: Port of Baltimore's Main Channel Reopens Following March Bridge Collapse

A crucial trade artery at the Port of Baltimore has been unclogged. On Monday, the East Coast port’s main ship channel, connecting its facilities to oceangoing vessels, was reopened following the complete removal of debris leftover from the Mar. 26 collapse of the Francis Scott Key Bridge, which formerly spanned over the Patapsco River.

In a news release, the U.S. Army Corps of Engineers announced the full restoration of the Fort McHenry Channel to its original operational dimensions—700 feet wide and 50 feet deep. As a result, commercial vessels have been permitted to transit through the channel to and from the Port of Baltimore.

Prior to Monday, the port was deprived from fully operational channels for nearly three months after the Dali, a container ship, lost power and veered into support columns of the Francis Scott Key Bridge, toppling the structure into the water below.

On May 20, the ship was removed from the site of the collapse, while federal investigators released an initial report that detailed how the vessel lost power prior to striking the bridge.

Read our insights from May for a closer look at the findings of the federal investigation.

Efforts to restore the Fort McHenry Channel to its original condition resulted in the removal of around 50,000 tons of bridge wreckage that toppled into the Patapsco River.

Interlog’s perspective

Prior to the port’s temporary closure following the bridge collapse, Baltimore was experiencing considerable growth relative to other East Coast ports. It was one of the few gateways in the country that saw a year-over-year increase in import volumes in 2023.

However, the unforeseen circumstances of March’s incident stunted this run of progress for the East Coast port, diverting discretionary cargo to other U.S. ports, like New York and Norfolk.

For the most part, other ports had sufficient capacity to absorb the diversions. However, in what it is a phenomenon that can applied when any supply chain disruption occurs, there were cases of confusion and even hysteria among shippers, many of which never used the Port of Baltimore, who were not fully clued in by their logistics partners.

Understandable in the moment, as some heard the news of a port closure, regardless of its size or relevance to their supply chain, their imaginations ran amok. Without the consul of a trusted, knowledgeable, partner to ground their concerns, a sort of routing shuffle proceeded among many East Coast shippers. Afterall, the fear was, upon Baltimore’s closure, an influx of container volumes would overwhelm the totality of the East Coast port system.

Some, who usually route to New York, would route to Charleston. Some, who usually route to Norfolk, would route to New York. And, so on and so forth. Ultimately, large-scale chaos did not ensue because of these decisions, but for the ones who did reroute, an unnecessary application of emergency protocol may have inconvenienced their supply chain and made their job a lot more stressful.

Insight: Inland Port in Nevada Now Open

A new inland port located in Nevada has opened, offering services that include imports/exports, a full-service intermodal and rail facility with switching, transloading, chassis service, and more – the Port said in an official statement.

It acompasses 224-acres, developed (and owned) by Industrial Realty Group, and containers started to arrive at the port on June 3.

The Port of Oakland, Union Pacific, and CMA CGM (exclusive ocean carrier provider of the port) are all partners in this endeavor. Furthermore, direct access to rail is a big part of the port, which they say will create more savings, efficiencies, and options for customers at the Port of Nevada.

Check out our other content!

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Week 1 - Originally released June 7

Insight: A Strange Series of Events for One Southeast Port

The Port of Charleston is otherwise an unassuming port on the U.S. East Coast. It has a good track record of dependability, especially stepping up when its name is called. For instance, Charleston served as an alternative gateway when pandemic-era chaos overwhelmed more popular U.S. ports, like Savannah and New York. With the market comparatively calmer, it would seem as if Charleston would return to being what is typically had been—a capable understudy to more bustling seaports. Its name would no longer be in the headlines, right?

Well, given a bizarre set of events that have transpired in recent weeks, the Port of Charleston has earned the attention of international shipping’s latest new cycle.

Officials safely guide disabled ship through Charleston harbor

On Wednesday, local crews saved the day, helping a rogue container ship avoid one of South Carolina’s busiest bridges above the harbor of Charleston.

The MSC Michigan, which was traveling at a brisk 20 mph, lost control of its engines a little past noon on June 5. The ship had recently departed from a container terminal at the Port of Charleston and was headed towards the Port of Savannah.

The sudden emergency was met with a swift response. Ahead of the disabled ship’s course in the direction of the structure, the eight-lane Ravenel Bridge was promptly closed as local police cleared traffic and pedestrians. Simultaneously, harbor pilots were able to safely guide the compromised vessel under the bridge, averting a potential impact with the structure’s support columns. The Ravenel Bridge remained closed for around ten minutes as the MSC Michigan sailed underneath without incident.
The vessel proceeded to transit out of the Charleston Harbor where it was anchored eight miles offshore. The U.S. Coast Guard, in cooperation with partner agencies, will continue to investigate the incident.

Charleston sees ship congestion following software issue

The nerve-wracking case of the MSC Michigan is not the only instance of recent memory where port operators have held their breathes.

In late May, the Port of Charleston, along with its sister network of inland ports in South Carolina, were closed for nearly two days due to a software malfunction. According to port officials, the malfunction was not an issue of cybersecurity, but rather technical in nature. Regardless, the hiccup forced the closure of truck gates at terminals in both Charleston and inland ports of Greer and Dillon.

While the ports resumed operations in less than 48 hours of the malfunction, a return to normal cargo flow is expected to take weeks as the side-effects linger. This is best illustrated through a backlog of ships which has formed off the coast of Charleston. According to MarineTraffic, on June 6, 12 container ships were anchored at sea, awaiting to be handled. 

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Insight: Europe River Contends with Bloated Water Levels

The Rhine River, a crucial inland waterway connecting Europe’s hinterland to the North Sea, has faced significant rainfall and subsequent flooding, posing severe disruptions to barge transport. Earlier in June, sections of the river completely paused barge traffic for a few days. Contingency plans from carriers included diverting discretionary barge cargo to either rail or truck, however shipments remained subject to delays or cancellations given capacity constraints.

Ironically, the challenge of too much water afflicting the river’s freight movement is the opposite of what tormented stakeholders over the last two years—too little water. In 2022 and parts of 2023, the Rhine River negotiated a drought, a dry spell which lowered water levels and spurned barge traffic.

Parallel to the role the Mississippi River plays in U.S. trade, the Rhine River is a critical waterway for the transportation of bulk commodities, like grain, coal, and minerals, in Europe.

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