Surcharges Are Here / Suez Crises / Panama Canal
Dear Valued Customer,
To our valued customers:
Though freight had seemed to be leveling out at a pre pandemic level, the recent world issues have begun to impact container freight in more than one way. We have been notified that effective January 1, steamship lines will be implementing a $1,000 ocean freight surcharge on all routes based on a 40 ft container. This can’t be avoided. Additionally, space is extremely tight and transit times will be delayed up to 3 weeks with the re-routing of ships. Less sophisticated shippers of cargo will have trouble securing space or even be able to get accurate information. All of this combined with a limited amount of time to ship from Asia prior to Lunar New Year celebrations that traditionally result in multi-week plant shutdowns in early February. We’re asking all customers to plan accordingly. CMI will be well positioned, as always, to ship and service our customers.
Below is a great video from a Hapag-Lloyd executive assessing the Suez Canal issues and how this also affects market rates and transit times. For January, space will be a crunch-fest since the Suez is no longer viable. Expect a large GRI in January but book ASAP.
The following is a summary of some related information from a recent JOC (Journal of Commerce) article:
Ocean freight challenges are affecting January shipments:
• Steamship lines are implementing a $1,000 surcharge per 40 ft container (effective January 1).
• Limited space and potential 3-week delays due to ship rerouting.
• Panama Canal restrictions due to drought causing transit delays and higher surcharges.
• Suez Canal route not viable for THE Alliance in January, leading to longer transit times.
Recommendations for shippers:
• Booking space ASAP to secure availability is critical (limited cargo space expected).
• Expect General Rate Increases (GRIs) in January.
• Consider alternative routes like intermodal rail to avoid Panama Canal delays where possible.
• Monitor weather patterns to anticipate other potential disruptions.
Key takeaway:
January will be a challenging month for ocean freight with limited space, delays, and rising costs. Advanced planning and flexible shipping options are crucial to navigate these disruptions. CMI remains well-positioned to ship and service customers.
Please feel free to reach out to us for assistance or with any questions that you may have.
Continental Materials, Inc. (CMI) is a national supplier of roofing system component materials and known for BUR (built-up roofing) asphalt with “No Smell”™ odor eliminating technology and its WeatherSeal™ protective packaging, All-Weather™ asphalt felts and coated organic rolls, CMI All-Weather™ modified bitumen rolls, SureGrip™ construction fasteners and roofing nails, Continental’s eco-friendly high density fiberboard roof insulation board and a premium line of SecureGrip™ synthetic roof underlayment products that are sold and used widely throughout the country. CMI has provided value added products and superior service to the roofing industry since 1958.
For more information on CMI products, call (215) 884-4930, visit www.continentalmaterials.com or contact your local CMI Sales Representative.