Weekly Logistics Briefing Key logistics updates for the week (Week 4 of May 2024)

ILA and employers confident as master labor contract talks set to begin. The International Association of Navigators (ILA) and the United States Maritime Union (USMX) announced in their first joint statement on the upcoming contract negotiations that the process is going as planned. This comes as there have already been calls for federal intervention to shepherd the talks for the contract that is set to expire on September 30. “We are confident that with tentative local contracts negotiations scheduled completed by the May 17th deadline, the ILA and USMX can begin full Master Contract talks with the goal of reaching an agreement on a new pact before the September 30, 2024, expiration of the current contract,” said ILA President Harold J. Daggett and USMX Chairman/CEO David F. Adam, in a joint statement. Business and industry fear a similar situation to the 2023 unofficial slowdowns and disruptions at West Coast ports as those talks dragged on for 13 months

CPKC expects that Canadian railway strikes or closures are unlikely to occur before July. CPKC said that Canadian engineers, engineers, and railway traffic controllers are unlikely to go on strike or be suspended within the next 60 days. A legal strike or lockout can’t occur until the industrial relations board issues a decision on what commodities, such as propane, are deemed essential. Once a decision is issued, Canadian labor law requires 72 hours notice before a strike or lockout could begin. CPKC said. “If no maintenance of services agreement is reached, based on precedent, it is unlikely the parties will be in a position to initiate a legal strike or lockout within the next 60 days.”. That means July 15 may be the earliest a strike or lockout could occur. Meanwhile, CN executives said moving some commodities but not others during a strike or lockout would be impractical.

From 7 to 15 May, the Panama Canal Authority(ACP) will perform maintenance work at the Gatun Locks. During this period, daily transits will be reduced from 20 to 17 at the Panamax locks. However, no significant impact is expected on containerships as this segment is usually handled with priority and according to pre-booked slots. The Canal has revealed a series of measures to optimise transit operations in the next few weeks. These include increasing the total number of transits per day to 31 starting May 16. Another increase will follow on June 1, when 32 daily transits will be allowed through the Canal. Starting June 15, Neopanamax locks will raise the draft restriction from 13.41 meters (44 feet) to 13.71 meters (45 feet). According to the Canal's latest statistics, 789 vessels were handled last month, a 6% increase over March.

Severe flooding in Porto Alegre, Brazil, has resulted in 147 deaths and forced hundreds of thousands to evacuate. Torrential rains have caused rivers, including the Guaíba, to rise significantly, exacerbating the situation. The disaster has also left 131 people missing and over 800 injured. The Civil Defense of Rio Grande do Sul reports widespread flooding affecting 446 municipalities. The economic damage is estimated at $3.7 billion. The floods are attributed to climate change and the El Niño phenomenon, with continued heavy rain predicted for the region.

On May 15, the International Longshore and Warehouse Union (ILWU) Local 514 agreed to postpone the strike notice. The Local represents over 700 ship and dock foremen working at terminals including DP World Canada’s Centerm container terminal in Vancouver. Port workers do not belong to Local 514, but due to their supervisory role, strikes can affect container operations. Bargaining began at the end of May 2023, but contract negotiations have been stalled so far. Businesses fear that Canadian commerce and trade could be brought to a halt by a series of strikes including DP World, but also a threat against Canadian rail and another at the East Coast ports.

The National Federation of Ports and Docks (FNPD CGT) announced that operations would halt at all ports in France for a period of four hours between 10:00 and 16:00 local time on the following days. The planned strike schedule is May 21, 23, 27, 29, 31; June 4, 6, 10, 12, 14, 18, 20, 24, 26, and 28. Port workers engaged in several strikes this year to denounce unresolved pension reform and labour conditions issues. The union called for new strikes as the latest negotiations with the government were not put into action.

The Houthi rebels claim an attack on the U.S. warship USS Mason and a ship identified only by Destiny, while the U.N. discusses measures. At the U.N. Security Council meeting on May 13, the U.S. urged the Security Council to move more actively to prevent Iran from exporting weapons to Houthis rebels. Many member states urge Houthi rebels to stop attacking ships passing through the Red Sea and the Gulf of Aden, stressing that security is a prerequisite for peace. On the other hand, Russia's representative expressed regret, saying that the situation has become more complicated due to Western attacks on Yemen's sovereign territory and increased militarization.

May holiday closures, software updates and the closure of two berths for construction are increasing congestion at Hamburg CTB. At Hamburg CTA, shore-power construction has reduced the number of berths available by one. A high slot shortage at terminals, especially Eurograte, is causing delays in container pick/up and drop-offs. From 18 May, 00:00 to 20 May, 24:00, rail access to the port will be completely closed due to construction work.

Bad weather caused delays for 14 flight departures from Sardar Vallabhbhai Patel International (SVPI) Airport in Ahmedabad. The affected flights included two each to Pune, Mumbai, Kolkata, Chennai, and Delhi, and one each to Dubai, Ayodhya, Kochi, and Bengaluru. The Dubai-bound flight experienced a delay of two hours, while domestic flights faced delays ranging from 45 minutes to three hours due to thunderstorms and unseasonal rainfall in various parts of the country.

Railway union workers are scheduled to go on strike across Italy from May 16 to 20. The strikes of Trenitalia, Italy, and Trenord are scheduled from 3:00 on May 19 to 2:00 on May 20, and the train timetable may be changed before and after the strike. The strike could affect high-speed, long-distance and local train services. Mechanical workers of Mercitalia Rail also went on strike from 21:00 on May 16 to 21:00 on May 17.