TP Pulse: Shipper worries over ILA strike remain

   Eastbound transpacific shippers continue to worry about a possible strike at U.S. East Coast ports, according to data from the latest Transpacific Pulse survey conducted last week by American Shipper.
   Fifty-three percent of shipper respondents said they would route cargo via U.S. West Coast ports, compared to 55 percent of shippers asked the same question in the May survey.
   Nineteen percent said they would use east coast Canadian ports to avoid a potential disruption, up from 18 percent in May.
   Unionized dockworkers are in contentious negotiations with the representative organization for East and Gulf coast terminal operators and carriers as they try to hammer out a new contract before the current one expires in September. The latest talks have sparked some optimism, but the fear among the goods movement community is that the two sides will play a game of brinksmanship and end a more than three-decade-long run of no work stoppages at East and Gulf coast ports.
   The percentage of respondents who said they aren’t worried at all about a strike and wouldn’t make major changes to their supply chains held steady at 24 percent, up marginally from 23 percent in May.
   The survey, the fifth conducted by American Shipper since November, gathered opinions from 71 shippers, polled from July 24-27. More than 40 percent of respondents ship less than 2,000 TEUs annually on the eastbound transpacific, while nearly 20 percent ship more than 25,000 TEUs annually on the trade. Two-thirds of shipper respondents were manufacturers or retailers.
   When asked for an assessment of current capacity levels on the eastbound transpacific, 54 percent of respondents said it was even, with 31 percent calling it tight and 10 percent calling it soft (down from 14 percent in the May survey). Only 5 percent said it was very tight.
   Roughly the same number of respondents (51 percent) said they expect capacity to stay at current levels over the next few months. Thirty percent expect to see a moderate amount of capacity pulled, while only 8 percent expect to see capacity added.
   Interestingly, 10 percent said they were uncertain about future capacity levels, up from 8 percent in May, and 2 percent in March.
   After several rounds of proposed rate increases from transpacific carriers this year, it’s little surprise that 55 percent of shippers said their rates have increased in the last month, though that’s down from two-thirds in May. Nearly 30 percent said the increase has been significant, up marginally from the 26 percent whose rates rose significantly in the May survey.
   Cargo rolls, a problem in the slack season, continue to be less of an issue for shippers, with 57 percent saying they’ve had no cargo rolled recently, and another 31 percent saying rolls have happened, but not often. In May, it was 52 percent and 35 percent, respectively. – Eric Johnson