Walmart Chartering Its Own Container Ships
Major retailers like Walmart and Home Depot are taking the largely unprecedented step of leasing entire container ships to ensure that their products reach store shelves in time for the busy Christmas shopping season that is just around the corner.
We learn this and more in a Supply Chain Dive article by Matt Leonard entitled “Walmart charters ships to ensure freight capacity, inventory for peak season.” He quotes Global Ship Lease Executive Chairman George Youroukos that his company has “signed 40 new charter agreements so far this year.”
Although this is a wise move for those who have deep pockets, it will make it more difficult for those companies that do not.
Ports of Los Angeles and Ningbo Experience Severe Backups
Things are not getting any better at the ports of Los Angeles. That’s according to a Seeking Alpha article by Carl Surran. Entitled “Cargo ships stacked up off Southern California ports, straining supply chains,” the report states:
Thirty-seven container ships reportedly are stacked up off the adjacent California ports in recent days, the highest number since February. U.S. importers are bringing in cargo earlier “knowing that it probably will take longer to get it into their systems,” Port of Los Angeles Executive Director Gene Seroka says.
If you think that’s bad, the Covid stricken port of Ningbo has more than 50 container ships stacked up off-shore. That number was 28 last week.
If you are a big FedEx direct-to-consumer shipper, you are facing some big surcharges during the peak shipping season. That’s according to a Freightwaves article by Mark Solomon, “FedEx peak surcharges pack wallop, but there may be loopholes.”
The first cycle covers packages shipped from October 4 through 17. The second cycle covers from November 15 through 28.
The surcharges will only apply to companies shipping in excess of 25,000 packages per week by ground to residences.
The article goes on to report:
According to Shipware estimates, surcharges for FedEx Ground’s home delivery services will rise between 12.5% and 25%, with the percentage increasing along with the volumes. The company’s air express residential surcharge will range from 7.5% to 20%, again depending on volumes, Shipware said. The levies can rise as high as $6 per piece,
Some of these companies may choose to ship through the U.S. postal service to avoid the surcharges. Based upon that agency’s recent performance, we may expect to see packages that shipped in 2021 will arrive in 2023.