Flexport

Each day, ecommerce platforms ship 11,000 tons of goods by air. As the global air freight industry continues to grow, shippers should stay current on a number of key market factors—especially in preparation for 2025. For many, that means keeping tabs on the potential ILA strike, the proposed de minimis rule changes, and the European Green Deal, among other considerations. According to Thomas P.C. Kempf, Flexport’s Senior Director of Global Air Freight, all of these may play a pivotal role in shaping next year’s air freight market. Get the full breakdown on our blog: https://lnkd.in/exNTt3q2

🌊 Weekly Global Logistics Market Updates 🌊 Here’s what we’re monitoring: 📝 On September 13, the U.S. Trade Representative (USTR) outlined final modifications to Section 301 tariffs imposed on certain products originating from China. We have compiled a list of items subject to the new tariffs—some of which go into effect tomorrow (September 27, 2024). 📝 With a potential ILA work stoppage looking increasingly unavoidable, multiple U.S. ports are implementing contingency plans. Ocean carriers have also announced key measures and cut-off dates ahead of a potential port work stoppage. 🚢 Transpacific Eastbound (TPEB) Ocean Route: Should the ILA work stoppage materialize, expect carrier-imposed surcharges, operational disruptions, port congestion, and vessel deployment issues affecting East Coast and Gulf Coast schedules. 🚢 Far East Westbound (FEWB) Ocean Route: Floating rates have continued to decline in the second half of September due to easing demand, but remain above early 2024 levels. Carriers are proactively adjusting rates to optimize vessel utilization. The SCFI dropped by $591/TEU in August and an additional $1,808/TEU in September. ✈️ Air: Air cargo tonnages increased by +4% in week 37 (Sept. 9-15), driven by +5% growth from the Asia-Pacific, +6% from Central and South America, and a +10% rebound from North America, following Labor Day disruptions. Check out the full update for more, and subscribe today to stay on top of the latest news and trends from around the industry. 

In terms of supply chain disruptions, what sets a potential ILA strike apart from the pandemic? The bottlenecks of Covid were largely demand-related, Flexport CEO Ryan Petersen told Blake Burman at NewsNation. A strike, on the other hand, would drastically cut supply. “A supply-side shock, as opposed to a demand-side shock, is a whole lot worse for the economy,” Ryan explained. “If you can’t move goods, and if you turn off the circulatory system of the economy, there could be very dangerous implications.” Watch the clip for Ryan’s full breakdown, plus insights into potential strike length and severity, the possibility of U.S. government intervention, and more 👇

📣 Next Thursday (10/03), our trade advisory experts will dive into Harmonized Tariff Schedule (HTS) classification and tariff engineering—essential duty optimization tools for today’s importers. In light of the recent U.S. executive action targeting de minimis shipments, we’ll walk you through one of your most immediate compliance priorities: HTS classification at the 10-digit level. You’ll also learn about the fundamentals of tariff engineering, how product composition can impact duty rates, and more. Sign up today: https://lnkd.in/eXcby2DV

For retailers using the de minimis exemption, the proposed rule changes mean potential cost surges. Beyond tariffs themselves, businesses face new expenses associated with updated classification requirements. “If you have the same products over and over again, then it’s a one-time expense per product to get it classified properly,” Flexport CEO Ryan Petersen told Sourcing Journal. “But if you’re constantly releasing new products, you have to go through that hurdle [with each new product]." Even so, Ryan believes businesses will readily adapt. “It’s entirely possible to do, even if you have a dynamic catalog that changes every couple of weeks,” he added. “I think the thing that will be difficult is if these rules come out on short notice and are imposed quickly.” Read the rest 👉 https://flx.to/ryan-SJ-LI

I look forward to sitting down with Eric Johnson on Oct 2 at #Inland24 to discuss how digital freight has evolved from the era of massive investment pre-Covid with closed systems to a new phase where technology like the Convoy Platform has been opened up and put in the hands of more and more brokerages to drive increasing impact and automation.

Earlier today, Flexport CEO Ryan Petersen appeared on Yahoo Finance, where he explored the impact of the potential ILA work stoppage on U.S. supply chains. A prolonged work stoppage could lead to pandemic-level disruptions—and likely even surpass them. “It really just depends on how long it lasts,” he explained. “If it lasts for more than a few days or more than a week, you're going to get massive cascading effects of cargo backlog that needs to get moved and can't." Watch Ryan break it down: https://lnkd.in/egEYtDpX

Make the most of the peak season rush. Tomorrow (September 25), our experts will take a deep dive into current and peak market conditions for ocean and air shipping. Learn more about navigating today’s demand surges—and get the peak season strategies and insights you need to succeed. 📌 Save your spot: https://lnkd.in/etBB4eAD

This week, the Flexport.org team will join world leaders and global humanitarian organizations at the United Nations General Assembly, where we’ll address the world’s most pressing challenges. We’re eager to explore new avenues for impact alongside global changemakers—especially as we wrap up another year of far-reaching initiatives and partnerships. Our 2024 Impact Report spotlights that work—including critical initiatives spanning 72 countries. Leveraging our unique logistics expertise and technology, Flexport.org shipped 27 million pounds of aid in the past year alone, delivering essential supplies to communities in need. Read our report to learn more: https://lnkd.in/eYCFBppk #UNGA #UNGA79

The potential ILA work stoppage—slated to begin next Tuesday, October 1—looks increasingly inevitable. A number of East and Gulf Coast ports have already implemented contingency plans, while major ocean carriers have announced key measures and cut-off dates. Check out our live ILA-USMX blog for a detailed overview of the latest developments: https://flx.to/ila-usmx-LI