GSCW chat recap: Dealing with ocean transportation logjam

BIOS:

In addition to his managing director role at Drewry, Damas is the founder and operational head of Drewry Supply Chain Advisors, the logistics arm of the Drewry Group. He is also the founding director of shipping research and database company ComPair Data. Damas’ career includes time analyzing the shipping sector with American Shipper and Containerisation International as well as management and financial control duties at CMA CGM and container shipping consortium Cobra.

Gillespie’s 42-year career in logistics includes leadership roles managing transportation and logistics for American Standard and Rhone-Poulenc. He also served on the board of The National Industrial Transportation League for 18 years.  

KEY QUOTES FROM DAMAS:

On the current state of container shipping: “The congestion at ports in Los Angeles and Long Beach is the worst that we’ve ever seen it. Globally, 50% of ships are arriving late now. At origin, a high percentage of cargos are not shipped on the original ship. The load factor of ships is at a record high. The container velocity is 25% lower than last year, leading to major shortages.”

On when the bottlenecks will ease: “We are seeing carriers invest in new shipping containers. The statistics we have at Drewry is that the production in the second half of this year is up 80% from last year. So the carriers appear to be taking that seriously. But it will take a while until the containers are available.”

KEY QUOTES FROM GILLESPIE:

On the impacts to the shipping schedule: “Normally, we’d be in the 80% range of shipping in the window that we had planned and then some tweaking that might be a week or so extended from that. Now we’re in a situation where maybe 40% of our schedule is actually moving on the time that it needs to move. And that’s also being faced with congestion at the destination side.”

On predictions and missed predictions: “We couldn’t forecast and I didn’t see anyone forecast that early September would start to be a critical situation on the trans-Pacific and then roll into the other trade lanes. In the past when we’ve had critical trade lanes, it might be just a major trade lane but not every trade lane. This went from September to October and then expanded into Asia-Europe and then intra-Asia and became as we see a global phenomenon. Nobody knew in July though.”

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