The steamship lines expect strong container volumes into North America at least until Chinese New Year, if we’re reading the tea leaves correctly. Both the OCEAN Alliance and 2M+ZIM are swapping out smaller vessels for larger ones to increase capacity into the West and East coasts, respectively. Some of those changes won’t be effective until late December.
And OOCL announced an “emergency” intermodal surcharge for West Coast door moves beginning Jan. 1. For every container for which shippers have OOCL arrange drayage to a transloading facility or warehouse in a major West Coast port, the carrier will tack on an additional $350.
For those reasons, we don’t see the intermodal network fluidity issues that have shifted back and forth from the West Coast to inland markets being resolved in the next two months. After months of promises by railroads that new, intelligently utilized assets were restoring fluidity to intermodal networks, this week’s data shows that dwell times continue to lengthen and train velocities are still slowing.
For now, those problems have returned to Southern California, where Ontario has the highest intermodal tender rejection rate in the country, topping 14%. But we wouldn’t be surprised to see another wave of capacity tightness and container shortages spread into Chicago and Memphis, Tennessee before the holiday.
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