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The freight market from Asia to the US remains soft, and indications point to a muted peak shipping season. Importers’ inventory levels are improving, coming down from record highs of the last year. Consumers, however, are cautious heading into the back-to-school and holiday seasons, so importers are not planning significant restocking efforts. Freight rates reflect the slower pace; ocean rates are roughly back to the low-end levels seen in the early months of 2023, prior to the April rate increase that held rates at a slightly higher level for a few weeks. Unless ocean carriers significantly cut capacity or a volume surge emerges, it’s unlikely that the market will support any peak season rate increases.

Imports from Europe are also down, and freight rates on that trade lane are similarly low, close to pre-pandemic levels. Equipment challenges persist at inland depots across Europe, however, since container imports from Asia to Europe are soft, mirroring the Asia-US market.

US export lanes are relatively stable, as is the domestic truck market. Slow volumes have pushed domestic rates close to the bottom of the market.

After more than a year of negotiations, the US West Coast (USWC) labor union, International Longshore and Warehouse Union (ILWU), and employers, the Pacific Maritime Association (PMA), reached an agreement on the new labor contract earlier this month. The deal followed months of sporadic labor disruption and uncertainty surrounding port operations on the USWC. Shippers across a variety of industries shifted cargo from USWC routings to more secure East and Gulf Coast gateways to avoid supply chain disruption, resulting in loss of market share for USWC ports. The next step for USWC is the lengthy contract ratification process, which requires input from union membership and is likely to take a few months to complete. Fortunately, ratification is expected, and future port disruptions related to this contract negotiation are highly unlikely.

 

 

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Your CVI team is here to assist you through these current market challenges. Ocean freight, air freight, domestic road/rail, and Customs Compliance – count on our dedicated professionals to care for you and your supply chain. Call us and let us show you what we can do!

 

Rachel Shames

VP, Pricing & Procurement

CV International, Inc.

 

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Rachel serves as Vice President, Pricing and Procurement for CVI. Her responsibilities include vendor selection, contract management and negotiation, transportation pricing, FMC compliance, and international agent network management.

Rachel began her career in international shipping with CMA-CGM America. She joined CVI in 2011, gaining experience in various departments with a focus on inside sales and marketing for the company. In 2014, Rachel assumed the role of Manager, Transportation, working on service procurement and development of client proposals. She has served in her current position since 2018.

A native of Norfolk, Virginia, Rachel earned her bachelor’s degree from the University of Michigan in 2005. She holds a Master of Business Administration with a concentration in Maritime and Supply Chain Management from Old Dominion University.

– Rachel Shames, VP, Pricing & Procurement, CVI
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