ILWU contract situation – update.
In an effort to keep you up-to-date regarding the ILWU contract situation, pleae note the current events in the Transpacific Market.
- Booking & Capacity
- General Rate Increase
- Congestion Surchrges
- Labor Update
Booking and Capacity
Essential for everyone to book import shipments , least 2 weeks before ship date if this is possible! The container ships are currently full and many are overbooked.
As you will read below in the west coast labor update, many importers are already diverting shipments from West Coast to other ports. As a result of diverted shipments coupled with an increase in shipments, ALL PORTS are experiencing an increase in volume. So it is important to:
A – Book shipments as early as possible. Two weeks is the minimum.
B – Provide forecasts of pending shipments volumes to your WWL representative if possible. This helps our origin office plan booking with the ocean carriers.
The carriers have filed for a General Rate Increase for May 15th. This does not mean that the increase will be implemented in full and is dependent on how full the container ship are.
The Quantum GRI $240/ 20 $300 / 40 $340 / HQ
The carriers have also forward filed for “Port Congestion Surcharges”. In the event of a west coast strike , slow down or heavy volumes to contingency ports, the carriers have filed for a “Congestion Surcharge”.
The surcharges are in excess of $1000. These surcharges can effect any of the ports servicing the United States. They have done this before but as yet have not instituted it to the trade. Just want you to know it’s out there.
West Coast Labor
As we informed you last month, negotiations for a new contract between the International Longshore and Warehouse Union, and the Pacific Maritime Association – representing employers – will begin on May 12.
Speculation throughout the trade community is that an agreement will not be reached before the current contract expires on July 1, however, many believe negotiations will continue without a strike or lockout although work slowdowns are possible. Truthfully it is impossible to know what will occur but helpful to plan for slow downs or stoppages.
The key issues for the new contract include:
The Affordable Care Act tax impact in ILWU “Cadillac” health plans
Productivity and efficiency.
Planning ahead may help minimize the effects of any future slowdowns on your supply chain.
Some of the options for contingency plans, beside shipping to West Coast into the deadline, are :
1.) ship as early as possible to stock up on inventory,
2.) reroute IPI cargo over Canadian ports or IPI and West Coast cargo to U.S. East coast ports.
We look forward to discussing this with you and please feel free to contact us regarding these issues.
Worldwide Logistics Ltd.