North America monthly reader
October - variance
North America - two coasts at variance
Introduction
Welcome to our October update, where we delve into the region’s significant events, focusing on the ILA strike. We also cover other recent challenges. We welcome your feedback and are available for in-depth discussions based on our data.
Pre-strike
The US East Coast and Gulf ports have faced persistent challenges throughout the year, with schedule reliability on a steady decline. As we noted in a previous update, Houston was impacted by storm Beryl, and Charleston has experienced ongoing congestion. Rerouting through the Cape of Good Hope has compounded these issues. Additionally, Hurricane Helene caused temporary shutdowns at Tampa and Miami ports, though Charleston and Savannah remained operational, albeit at reduced capacity. The OOCL Washington, operating on the OCEAN - AWE7 route, was diverted from Tampa port to Miami as the hurricane hit. However, Helene’s impact (on shipping) paled in comparison to what followed.
After months of negotiations (or lack thereof), the ILA strike began on October 1st, 2024 – the first of its kind in nearly 50 years. While some carriers had prepared for potential disruptions, the overall response was limited, with only 22 omissions, 3 port swaps, and 3 diversions recorded in the week leading up to the strike. Most of these adjustments were ultimately unnecessary, as the strike was brief, allowing vessels to return to their original schedules.
The US West Coast remained relatively calm, as did the Canadian East and West Coasts. On the West Coast, capacity saw a slight uptick as blank sailings were canceled, notably with MSC - Mustang, which deployed three vessels after a series of blank sailings. Additionally, HEDE - HDX started to call Los Angeles from Ningbo with a round trip of 28 days, with two vessels deployed, the 1,732 TEU Hansa Duburg and the 2,741 TEU Pona.
Despite the Chinese Golden Week contributing to a temporary rise in blank sailings, Halifax saw increased activity during the ILA strike, with 25 vessel calls, up from 14 the week prior. Meanwhile, the Canadian West Coast has seen reduced congestion, particularly at Tacoma’s Husky Terminal, where railcar shortages and earlier strikes had caused significant delays. In September, port swaps between Vancouver and Tacoma dropped to 6, down from 22 in August.
Recovery
With only a few preemptive measures in place before the strike, carriers were quick to act once it began. Over 974,000 TEU of nominal vessel capacity were bound for US East Coast and Gulf ports in the week starting October 1st. The short duration of the strike allowed most ports to recover quickly, with vessel wait times returning to pre-strike levels by October 10th. However, some ports, like Jacksonville and Palm Beach, were hit by Hurricane Milton immediately after the strike, causing temporary closures and likely delaying their recovery.
The coincidence of the Golden Week with the strike may expedite recovery for US East Coast and Gulf ports, as the lower cargo volumes from China could balance out the disruption. Port congestion has also normalized, though some ports remain congested, with Palm Beach and Brunswick still seeing 100% wait times due to Milton. Savannah is the most congested major port, with 53% of vessels waiting to berth. As of October 10th, eight vessels were waiting outside the port, while seven were berthed. Twenty-nine vessels are currently enroute to Savannah, according to our data.
In response, carriers have employed several strategies to maintain schedule reliability, including omissions, port swaps, reduced speeds, and diversions, which primarily impacted the first ports of discharge. Notable examples include:
1. OCEAN – AWE4, Ever Legend initially omitted Charleston and Boston before the strike, but reinstated Boston on October 5th, two days after the strike ended.
THEA - EC2, Ain Snan Express reinstated calls at Charleston and Wilmington for October 6th and 8th, respectively. The vessel is scheduled to omit Cartagena on her backhaul voyage to Asia possibly in an effort to offset her accumulated delay of about 22 days.
THEA - EC5, ONE Swan successfully omitted Charleston and New York (one of the few vessels to omit more than one port), heading straight to Halifax with only a seven-day delay, and currently sailing back to Singapore.
2. MSC Sagitta III, operating on the MSC - Canada Gulf Bridge, made an inducement call at Halifax on October 2nd making it one of the two vessels that successfully diverted to the Canadian port.
ZIM Scorpio, skipped Boston and called Halifax to maintain its on-time performance departing North America with only a seven-day delay.
MSC had scheduled two vessels, Epaminondas and MSC Antonia, for extra-loader calls at Halifax, possibly anticipating increased cargo from US East Coast, but these calls were pulled as soon as the strike ended. Epaminondas is rescheduled to call New York, Norfolk, Boston and Savannah as an extra-loader, while MSC Antonia has been deployed to HL - ECX | MSC - NWC to SAEC - String I.
3. Carriers also employed port swaps to manage schedule disruptions. APL Danube on OCEAN - AWE6 called Charleston in lieu of Mobile, and is scheduled to call Mobile on October 11th. Similarly, Seaspan Loga swapped Norfolk for Philadelphia just before the strike. In total, we recorded three successful port swaps in the past month.
4. A number of diversion plans did not materialize. Six vessels diverted to Mexican ports made U-turns back to the original ports when the strike ended. MSC Paris on 2M - Med-ECNA loop 5 had been diverted to Freeport, but turned back to Savannah, arriving on October 6th. Other vessels including OOCL Washington, APL Esplanade, CMA CGM Rimbaud, Maersk Stepnica and MSC Angela did similarly. Four of these diversions were scheduled for Caucedo and one for Puerto Moin. OOCL Washington successfully diverted from Tampa port to Miami.
5. Some vessels have also been steaming slowly towards the US East Coast and Gulf ports since we still have moderate congestion in some ports. MSC Busan, deployed to 2M - ECNA RTW loop, reduced speed to 2.3 knots on October 10th heading to Jacksonville which was closed down on October 9th due to hurricane Milton. Likewise, MSC Long Beach VI, on 2M - ECNA Panama loop, on the same day did 2.2 knots with 596 nm to her next port of call in Miami. Wan Hai 503, deployed to WHL - AA9 which was recently reinstated, reduced its speed to 0.6 knots with 2,176 nm to Savannah. Other vessels include Columbine Maersk and Bernhard Schulte.
Our team plans to release the next edition of our newsletter in early November. In the meantime, please stay tuned for updates via our LinkedIn posts.
Kind regards,
John
