RENO, Nev., Dec. 18, 2023 (GLOBE NEWSWIRE) — ITS Logistics today released the December forecast for the ITS Logistics US Port/Rail Ramp Freight Index. This month, the index reveals that operations at ocean terminals throughout the US are running at normal levels and are expected to do so for the remainder of the year. Looking to 2024, trucking capacity is expected to continue exiting the market and could be compounded by California’s ban on new internal combustion truck registrations for drayage. West Coast ports also face the possibility of significant congestion, the levels of which have not been seen in almost a year.
“Today’s lower inventory levels could equal a more pronounced Lunar New Year peak than we saw in 2023,” said Paul Brashier, Vice President of Drayage and Intermodal for ITS Logistics. “Combine that with transpacific volumes being diverted from the East Coast as shippers avoid both the Panama and Suez Canal and it could quickly cause significant congestion.”
Exiting capacity in the market could worsen congestion and increase rates. ACF Drayage Truck Requirements in California ban any new registration of internal combustion trucks, which is expected to have a chilling effect on capacity and potentially drive more of it out of the market.
There is also the potential for ILA labor unrest at the East and Gulf Coast ports, which could drive even more volume to West Coast ports and increase the chances of disruption.
“ILA labor negotiations will be ongoing up until September,” said Paul Brashier, Vice President of Drayage and Intermodal for ITS Logistics. “If labor unrest occurs and more volume is driven west, it will be interesting to see if the West Coast ports and infrastructure is prepared to handle that surge in volume as capacity exits the market.”
Compared to October of this year, U.S. ports handled 2,099,408 twenty-foot equivalent units of imports in November. This was 9% less than in October, but volumes increased by up to 7.4% versus November 2022. Despite supply chain challenges, imports from January to November are up 4% versus the same period in 2019, supporting the fact that imports have continued to outpace pre-COVID levels. The data found in this month’s index reveals demand spikes in November and early December for Savannah, New York/New Jersey, Los Angeles/Long Beach, Dallas, and Chicago.
As the Panama Canal continues to experience congestion for non-containerized cargo due to water levels and additional charges on containerized goods, navigating the canal may cause some inflationary pressure. Several shippers have also chosen to avoid the Suez Canal completely in response to an increased number of drone attacks in the Red Sea and Gulf of Aden. Vessels navigating the Suez Canal should soon see increased insurance costs, which is likely to create additional inflationary pressure as well, posing the potential risk of vessels avoiding the canal altogether.
ITS Logistics offers a full suite of network transportation solutions across North America and omnichannel distribution and fulfillment services to 95% of the U.S. population within two days. These services include drayage and intermodal in 22 coastal ports and 30 rail ramps, a full suite of asset and asset-lite transportation solutions, omnichannel distribution and fulfillment, and outbound small parcel.
The ITS Logistics US Port/Rail Ramp Freight Index forecasts 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 Inland and East Inland regions. Visit here for a full comprehensive copy of the index with expected forecasts for the US port and rail ramps.
About ITS Logistics
ITS Logistics is a premier Third-Party Logistics company that provides creative supply chain solutions with an asset-lite transportation division ranked #21 in North America, the #11 drayage and intermodal provider, a top-tier asset-based dedicated fleet, and innovative omnichannel distribution and fulfillment services. With the highest level of service, unmatched industry experience and work ethic, and a laser focus on innovation and technology–our purpose is to improve the quality of life by delivering excellence in everything we do.
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