USA Update: Positivity for US businesses as spot rates stabilise and capacity returns
Calmer seas expected as stabilising rates, President Biden's no-strike promise, and increased shipping capacity create positive momentum for US supply chains
Following a tumultuous period for the shipping industry, positive signs are emerging for US importers, exporters and retailers as spot rates are expected to remain stable through to the end of July.
Despite some US retailers curbing their procurement due to having stockpiled as a result of the sporadic purchasing practices caused by COVID and congestion, it is likely that others will look to kick-start their global supply chains once again. The proposed removal of US tariffs on some Chinese goods is set to act as a stimulus to the North American - Asia import market as the region looks to recover from severe COVID-19 effects.
Further to the stabilising rates, President Biden has promised that no industrial strike action will take place during the ongoing talks following his meeting with the shipping unions w/c 13th June. Biden has stated that he will not allow strikes to cause any further blockage to US supply chains in an attempt to keep the American economy moving and reduce inflation. The current union contract runs until July 1st with promises in place until at least this time that no worker slow downs or strikes will be able to take place or affect terminal operations. In addition, the Bureau of Industry and Security has reinforced the importance of export compliance as the Assistant Secretary for Export Enforcement laid out the latest plans to amend the BIS' approach to export control enforcement and antiboycott laws in the United States.
The increased volume of cargo is however putting strain on US inland terminals. A significant rise in containers, especially long-dwell containers, across Los Angeles port's terminals from May to June 2022 is causing concern, leaving the US Railways devoting assets to LA and Long Beach ports in an attempt to clear the backlog, and focusing on the fast turnaround of Chicago-bound trains to return and alleviate the pressure.
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