Good day,
Shippers and freight-handlers say U.S. agencies that oversee the flow of goods are starting to cut back services and working hours, raising concerns that delays will spread across supply chains if the government shutdown continues much longer, according to the WSJ. Some exporters are running into delays getting export licenses approved. There are also fewer air cargo security staff are on hand to scan shipments, and some refunds for customs payments aren’t being processed, said industry officials and businesses that move goods through airports and seaports.
“As the backlog of unresolved problems increases, the amount of them is going to build exponentially,” said Brandon Fried, executive director of the Airforwarders Association, a Washington-based group representing freight-shipping agents.
So far, holdups over cross-border shipments have only been sporadic, business executives say, without the delays that some airports have reported in passenger operations at Transportation Security Administration checkpoints. Others are reporting serious delays at port, but note that the issue is “multipronged”including those still trying to get ahead of the tariffs. The extent to which the shutdown is to blame plays a part, but is only another piece of the complex puzzle.
Did you know?
U.S. average per-gallon national price for diesel fuel over the past week, the first week below $3 in 10 months, according to the Energy Information Administration.
Quotable:
“The challenge has been finding someone who can help and isn’t buried by an onslaught of other requests.”
—Mike Lahar of customs broker A.N. Deringer Inc., on the government shutdown
In other news:
The Supreme Court just handed a big, unanimous victory to workers. Wait, what?
On Tuesday, the Supreme Court handed a victory to American workers, ruling unanimously that independent contractors who work in transportation may not be forced into mandatory arbitration. (Slate)
U.K. Parliament repudiates Theresa May’s Brexit plan
Opposition calls for vote of no confidence in prime minister as uncertainty deepens just two months before Britain’s planned exit from EU. (WSJ)
EU court annuls 2013 Commission decision that blocked UPS takeover of TNT
The ruling opens the way for the world’s largest delivery company to sue EU regulators for damages. (Reuters)
Walmart consolidation center to open in Colton, bringing more than 600 jobs
The facility will initially employ 150 workers with a base salary starting above $15 hourly. (San Bernardino Sun)
Memory chipmaker Nanya slashes capex to offset trade war damage
Taiwan DRAM manufacturer blames weak smartphone and server demand. (Nikkei Asian Review)
Final thoughts:
The Ports of Los Angeles and Long Beach are having trouble accommodating the volume of goods coming in. Los Angeles alone handled a record 8.8 million cargo containers in 2017, up from 8.5 million in 2015, according to the Los Angeles Times. There is only 1.7 percent vacancy in industrial space in the Los Angeles area. CBRE broker Kurt Strasmann told the Times that the Inland Empire is one of the few regions that has enough room to build the warehouse space necessary for this growth in imports. The new development has attracted high levels of investment from major real-estate firms such as the Rockefeller Group, which according to the Times plans to spend $110 million on two facilities – one will contain over one million square feet in space – to be built outside of Riverside.
Hammer down everyone!