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Update: Covid-19 Disruptions

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Covid-19 continues to play havoc with Global Supply Chains with various starts and stops throughout the world.  Here are the latest updates on from our friends at Everstream Analytics, who monitors and produces these weekly summaries of supply chain impacts due to the ongoing COVID-19 pandemic.

The update is provided free-of-charge to the industry.

  • In China, authorities shut down Nanjing Lukou International Airport due to a COVID-19 outbreak among its workforce. The airport may be facing increasing congestion due to the closure.
  • Across the city of Nanjing, officials also set up more than 60 checkpoints to control the flow of all vehicles and people between Nanjing and other provinces amid the COVID-19 outbreak.
  • In Vietnam, Ho Chi Minh City imposed a 12-hour curfew starting July 26 to curb rising COVID-19 cases. Meanwhile, authorities in Hanoi have announced a two-week lockdown until August 8 to control a surge of COVID-19 cases.
  • Authorities in Bangladesh have re-imposed a countrywide shutdown to stem a new tide of COVID-19 infections after a weeklong recess due to the Eid al-Adha festival. The restrictions will last until August 5 and affect people movements as well as manufacturing, including in key sectors such as garment and textile.
  • In Australia, authorities announced the end of a lockdown in the state of Victoria from July 28, while restrictions in New South Wales would be extended for four weeks.
  • The President of South Africa announced that lockdown regulations were eased from July 25 as the country moved to adjusted level 3 lockdown. While interprovincial travel and larger outside gatherings have been allowed once again, a nightly curfew remained in place.
  • Authorities in the Dominican Republic re-imposed a nationwide nightly curfew amid rising COVID-19 infections. Exemptions remained in place for those providing essential services.
  • Similarly, the government of Honduras extended a nationwide curfew until at least August 1 to control the COVID-19 outbreak.

Please reach out if you need support navigating this difficult and uncertain times.  ICC is here to help.

7 critical mistakes shippers make when negotiating transportation and logistics contracts

Uber Freight to Acquire Logistics Firm

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As reported by Transport Topics today, In a case of David purchasing Goliath, Uber Technologies Inc.’s freight business is acquiring logistics technology firm Transplace from TPG Capital for $2.25 billion, the company announced July 22.  Transplace ranks No. 13 on the Transport Topics list of the Top 50 largest logistics companies, while Uber Freight is No. 41.

The company said the transaction to acquire Transplace from the private equity firm would accelerate Uber Freight’s path to profitability. Uber forecasts the

Covid-19 created an absolute explosion of Business to Consumer shipments which UPS obviously capitalized on.

combination will propel its Uber Freight segment to break even on profit by the end of 2022.  The transaction will be paid in $750 million in parent company Uber’s common stock and the remainder in cash, according to the company.

Uber Freight was initially launched in 2017 and is the company’s digitally enabled trucking platform that has operated heavily in Texas in recent years.

“The acquisition will combine the world’s premier shipper network platform with one of the industry’s most innovative supply platforms, to the benefit of all stakeholders,” Transplace CEO Frank McGuigan said in a statement.  “Our expectation is that shippers will see greater efficiency and transparency and carriers will benefit from the scale to drive improved operating ratios. All in all, we expect to significantly reduce shipper and carrier empty miles to the benefit of highway and road infrastructures and the environment.”

The transaction will give shippers using the Uber Freight platform access to even more technological solutions and allow carriers to communicate freely with shippers across more modes of transportation, according to Uber. It will also expand Uber Freight’s business into Mexico

We’re not at all surprised by this reported transaction and expect to see more mergers in the near future in an attempt to shore up capacity across the Truckload and LTL sector.

BNSF Railways Limiting Shipments

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In an effort to clear existing West Coast terminal backlogs, BNSF Rail has advised that it will, for the next two weeks, limit shipments from Los Angeles and Long Beach to Chicago. BNSF has also announced it will limit shipments from New York to Chicago, Cleveland, and Indianapolis for the foreseeable future.

While BNSF was not specific in stating what “limiting” actual means, it is clear that they intend to clear the backlog of shipments to and from the points listed as quickly as possible.

Shippers who will be affected by this announcement should work directly with their transportation service providers to minimize the impact of this service disruption for their businesses.

Please reach out to ICC if you have any questions, are impacted by this disruption or need further information.

Supply Chain Impacts due to COVID-19

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Everstream Analytics monitors and produces a weekly summary of supply chain impacts due to the ongoing COVID-19 pandemic. The update is provided free-of-charge to the industry.

Below is your weekly update:

  1. Vietnamese authorities imposed a two-week COVID-19 related lockdown in Mekong Delta and Ho Chi Minh City metropolis, with restrictions to be in effect from July 18.
  2. Myanmar announced a nationwide COVID-19 related lockdown from July 19, while declaring public holidays from July 17 until July 25 to contain the spread of COVID-19.
  3. Thailand has expanded COVID-19 restrictions that include travel curbs and a night-time curfew to three more provinces – Chonburi, Ayutthaya, and Chachoengsao – from July 20.
  4. Authorities in Libya imposed restrictions that require all government agencies to reduce attendance at work to 25 percent, until at least July 25.
  5. Mozambique tightens nationwide COVID-19 measures through August 17, with nightly curfew hours expanded to last between 21:00 and 04:00.
  6. Chile extended its border closure measures until July 25 due to Delta variant concerns, with all existing domestic restrictions remaining in place with the extension.

Need help navigating these disruptions?  Reach out to ICC today to learn more about our supply chain growth consulting services.

Thank you to Everstream Analytics for this valuable information. Please check out their platform by visiting their site.

New Import Tariffs Scheduled

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The office of the United States Trade Representative (USTR) has announced their plan to begin imposing Section 301 tariffs on US imports from six different countries. Beginning November 29, 2021, CBP will begin collecting duty on certain products imported from Austria, India, Italy, Spain, Turkey, and the United Kingdom.

The following is a specific list of products and categories for each country:

Austria: Glassware and Optical Goods

India: Shrimp, Basmati Rice, Bamboo Goods, Cork Products, Cigarette Paper, Jewelry, Pearls, Precious/Semiprecious Stones, and Various Furniture Items

Italy: Caviar, Perfumes, Handbags, Apparel, Footwear, and Eyeglass Lenses

Spain: Shrimp, Octopus, Handbags, Belts, Footwear, Hats, and Glassware

Turkey: Carpets, Linen, Building Stones, Porcelain and Ceramic Articles, and Jewelry

United Kingdom: Apparel, Footwear, Ceramic Goods, Jewelry, Refrigerator Products, Furniture, Toys, and Games

In an effort to ensure that all imports are being properly classified to avoid the possibly of incurring any additional financial surprises, especially at this time of skyrocketing shipping costs, all importers who will be affected by these tariff changes should immediately contact their Customs Brokers to determine the impact on their businesses.

For those importers in need of expert advice and support regarding this update, as well as other Customs concerns should contact ICC Logistics immediately and we will be happy to assist.

ICC - UPS Rate Increase - 2016 - Breaking News

UPS adds “Peak Season” Shipping Surcharges

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We’re not sure if parcel shippers have been getting accustomed to having their rates increased every few months, but whether they are getting used to it or not, the parcel carriers are in the driver’s seat for sure; at least for now.

UPS has just announced another wave of surcharge increases, some going into effect on July 1, 2021.  UPS states in their official announcement that these increase are necessary for them to “ensure businesses and customers are able to meet their shipping needs while demand has increased for shipping services.”

Read the official announcement and get more details here.

As UPS goes, FedEx will probably be right behind with their surcharge increases.  And remember, we are not anywhere near the official “Peak Shipping” season.  The reality is that for as long as the parcel carrier volumes increase at record paces, shippers will need to adjust their budgets on a quarterly basis.  Annual Shipping Budgets are a thing of the past.  In addition, Single Sourcing may become a thing of the past as carrier capacity constraints will continue, at least for the foreseeable future so shippers will need to find other outlets for their excess parcel capacity.  But remember, the pendulum swings in both directions and if we have a downturn in the economy, which is a real possibility in the near future, the parcel carriers may be more inclined to “pay back” some of these increased costs with deeper discounts to retain their customers.

And, let’s not forget that the best thing a parcel shipper can do is have their parcel shipping costs Benchmarked by an Independent Third Party on a regular basis to make sure they are not paying more than they should, based on their ever-changing shipping characteristics.

Contact us today to learn more.