— ITS forecasts that reconsigned freight at the Ports of Vancouver and Prince Rupert will impact the US supply chain in coming months —
(RENO, NEV.: July 12, 2023) – ITS Logistics today released the July forecast for the ITS Logistics US Port/Rail Ramp Freight Index. This month the index reveals ‘severe’ conditions in the Pacific Port and both East and West Inland Rail Ramp regions due to the West Coast port labor strikes occurring in Canada. In addition, ITS forecasts that the labor strike at the Ports of Vancouver and Prince Rupert will not only negatively impact Canada but will have a severely negative impact on the US supply chain as well due to reconsigned freight.
“Most of the IPI freight that enters through these Ports are destined to major US rail hubs including Chicago and Memphis,” said Paul Brashier, Vice President of Drayage and Intermodal for ITS Logistics. “There is a high probability that a large portion of this freight will be reconsigned to US West Coast Ports if the vessels call on those ports prior to or after calling Vancouver or Prince Rupert.”
The Canadian ports handle nearly $225 billion in cargo annually and include items from industries such as apparel, home goods, and electronics that are transported by rail. In addition, according to port authority data, approximately 15% of consumer trade that moves through the Port of Vancouver is headed to or coming from the U.S. It was estimated by the Canadian Manufacturers & Exporters industry group, that the movement of $500 million worth of goods is being disrupted every day the strike continues, which impacts more than 30 B.C. ports. Just this past weekend, hundreds of citizens rallied in Vancouver in support of the over 7,400 members of the International Longshore and Warehouse Union Canada striking B.C. port workers as the events continue into the second week.
“Shippers should immediately put contingency plans in place to reroute freight into the US and alter the mode of freight to domestic truckload in anticipation of rail congestion that will occur when the strike is resolved,” continued Brashier. “Western US Ports will be affected due to Canadian volumes being reconsigned to the US in addition to the July kickoff of retail peak season. Furthermore, the East and Gulf Ports will see a spike in volume as retail peak freight starts to arrive and since most of the freight from the US East and West Region rail ramp services is routed IPI to US Rail Ramps, business there will be impacted as well. While container dwell in Western Canada increases, freight will overwhelm rail lines and ramps when it finally starts to transfer from the ocean terminals to the ramps.”
Ultimately, the rerouting of containers will add days to the delivery of products and therefore delay planned arrivals but with the negotiations currently still paused and the Canadian Parliament out of session it is best that the industry attempt to stay as ahead of this current supply chain disruption as possible. Port operations should remain stable in both the East and Gulf, but depending on the duration of the strike it could take one to three months for operations to return to normal.
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.
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ITS Logistics is a premier Third-Party Logistics company that provides creative supply chain solutions with an asset-lite transportation division ranked #23 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.