International Shipping

December 20, 2023

Global Shipping Update

International shipping will not be ending on a quiet note for 2023.

14% of global shipping sails through the Red Sea, which major shipping lines have stopped using after a recent wave of attacks on their ships in that area. Ships will need to be re-routed which will bring longer transit times and higher costs. Besides impacting what we do this will also add a new inflation risk to the economy.

It is expected the loss of this critical trade route could last for weeks and ships have already been re-routed to go the long way around Africa. This has the potential to be worse than the situation with the Suez Canal in 2021 when a ship was stuck there for a week. That created a chain reaction that was felt for months after.

Our team will let you know right away if any of your current moves with Karlibow will be impacted. For more details on this situation, you can read more about it here.

We are also monitoring the situation with the drought at the Panama Canal, which has resulted in a 33% reduction in capacity.

We received the following information from one of our shipping line providers.

Implications for U.S. West Coast Ports and Overland Transport

Given these developments, we expect a surge in the volume of cargo going from Asia to the US East Coast through the West Coast ports. The same situation happened in 2021-2022 when there were not enough trucks to meet the unprecedented demand for container transportation.

Increased Cargo Volumes at West Coast Ports: A surge in cargo volumes is expected, leading to heightened activity and potential congestion at these ports.
Higher Demand for Trucking Services: There will be an increased need for reliable trucking services to transport goods across the country.
Potential for Delays and Operational Challenges: Similar to the situation in 2020-2021, the industry may face significant delays and logistical challenges due to the sudden increase in demand.

Finally, there is freight congestion crossing the Mexico – USA border, which is expected to increase. This is being caused by the US suspending freight train crossings three days ago due to reports of record amounts of migrants using the trains to enter the US. This could divert more freight to using trucks which will impact capacity, costs, and transit time. Some more information on this situation can be found here.

As always, Karlibow will keep you posted on all of these developing stories and anything else that might impact household goods moving.