ITS Logistics today released the March forecast for the ITS Logistics US Port/Rail Ramp Freight Index. This month, the index reveals the most significant concerns over the next 12 months, including trucking capacity exiting the market and container supply chains at risk due to diversions around Red Sea avoidance effects. In addition, as Q2 approaches, the index will closely follow the International Longshoremen Association (ILA) negotiations as current ocean contracts are being deliberated.
“As we navigate ocean carrier RFP season this month, it is important to strategically plan your supply chain for the next 12 months,” said Paul Brashier, Vice President of Drayage and Intermodal for ITS Logistics. “It is critical to stay as geographically close to your trucking capacity as possible. If you can book to the ramp/port or, to the door while utilizing customer nominated trucker (CNT) commercial arrangements, you can ensure that trucking capacity is properly vetted and that you have trusted partners with a nationwide footprint.”
Since no significant traction has been made to date in the ILA negotiations, this has sparked a cause for concern across the industry. Overall, tactical hedging to the west is a strategy to keep in mind, and the ILA’s six-year contract with the United States Maritime Alliance expires September 31. It represents port terminal operators and ocean carriers on the East Coast.
“The union has confirmed May 17 as the cutoff date for the local contracts to be agreed to in order to implement the negotiation of a master contract for the largest union of port workers in North America,” continued Brashier. “Despite the fact that historically, the ILA has cautioned against striking in comparison to West Coast union counterparts, contingency plans should be put in place during this current ocean contract season.”
According to recent CNBC coverage, logistics managers are moving more freight away from the East Coast. This is occurring simultaneously with trade being rerouted due to the Panama Canal drought restrictions and Red Sea diversions. Cargo containers that were once set to be shipped to the East Coast are now beginning to be sent back to the West Coast. The goal is to avoid service disruptions, which is the reverse of what occurred in 2022 and 2023. Negotiations for the six-year contract officially began last month. While the future is currently uncertain, ITS urges professionals to proactively prepare for any disruptions resulting from the current negotiation climate.
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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