Episode Transcript
[00:00:06] Speaker A: Good morning and welcome to the Lodestar podcast News in Brief, where as always, we're going to be recapping the main events from last week's supply chain news and giving you an insight on what you might see on the Lodestar this week. I am joined now by Alex Linnane and we have just come back from Tiaka's air cargo forum in Miami, both quite jet lagged. Alex, what did you make of the event?
[00:00:25] Speaker B: Well, as ever, it's always fun to go to these events. It's nice to see everyone. I love Miami, but as ever, there's feedback from people who went and I, you know, like talking to people about how they feel about things. There was a lot of feedback from the exhibitors in particular where everyone was mentioning cost versus value. So costs were huge for exhibitors in particular. Someone told me it was $600 per day to get your tiny little stand carpet hoovered or vacuum cleaned. So I heard that some companies had managed to bring own vacuum cleaner for that. I'm not sure what Coin Airways, which sponsored the Wi Fi Zone, spent on it, but it was actually very difficult to get online. So there was a little inconvenience there. And Tiaka may have to revise their plan to charge for their welcome drinks reception. It was $150 per head, but there wasn't so much as a packet of crisps in sight. And I think most people don't actually want to drink $150 worth of booze in a couple of hours. I think a bit of food would have been very much welcomed. We hear that it was very expensive on. So I sympathize with Tiaka, but maybe the option is to go for somewhere that's a bit cheaper. And then people were mentioning the value as well. Now, Tiaka said there was some three and a half thousand registrations, but I have to say I never at any point thought I saw three and a half thousand people there. Admittedly it was over three days, but I just didn't feel that it was that busy, to be honest. I certainly miss seeing some people, as ever, that there weren't enough forwarders for, well, my line of work.
And there were some carriers went there. I mean, it was, it was good and it was, it was quite well attended, but I just, it would have been nicer if it had been a bit busier for the cost that it was. I won't go on about this too much, but there was a noticeable lack of women on the stage. I mean really no sport. And one of the organizers told me privately that they didn't care anymore. So that was pretty disheartening. And I do feel that eventually organizers have a responsibility to try to create a more diverse representation of who's in the industry. Now we're starting to see more men decline to go to events or speak at events that are 100% men. And if this carries on, then events will have to do something about it. So hopefully that will happen at Tiaka, too.
I mean, I really hope Tiaka made enough money to keep it going. It's a great organization. They tried terribly hard and it was a. It was a really good event. But I think they may have to look at where they're putting them on. I mean, we've got CNS next year will be in Miami. Air Cargo Americas has always been in Miami, but that's now moving to the same sort of South Beach Convention Center. And it's very, very expensive. To have three events in Miami seems a bit ridiculous. You know, I've been doing this for nearly 20 years and I've never ever been to Chicago. I mean, Chicago is a massive freight hub and I've never even been. So I'm wondering why events just sort of seem to always go to the same place and not start to look around at maybe other cities. Jacka's next show will be in Abu Dhabi, which I suspect will be easier for people to get to from all over the world and possibly cheaper. So we'll have to see how that pans out. But with the ever increasing number of events, I think people are starting to look very closely at the costs of each event and the value of each event. And I hope Tiaka stays on top of that. So what did you make of it, Charlotte? I mean, we didn't actually see each other very much because we were both running around so much.
[00:03:55] Speaker A: It's a big wall. Well, I don't have many events to compare it to. As you know, I've only been here about a year, so, I mean, I had had great fun. From the more newsy side of it, I think sustainability was a topic that quite a few people were talking about. One of the very large forwarders, dsv, said that they were going to take into account airline sustainability practices when choosing where to award their contracts. Another thing that I thought was going be quite big was the Trump tariffs. I thought that a lot of people were going to say it was going to have a huge impact on air freight, but actually what I heard was quite the opposite. And actually one person said, if anything, it's going to be really good for air because at least for the short term, it's going to add a lot of complexity to supply chains with shippers changing their sourcing locations, front loading China production, moving to other areas in Asia or to South America. And they said that any supply chain disruption is always going to be a good thing for air freight because that always sees peaks when issues happen elsewhere.
[00:04:48] Speaker B: Yeah. Air freight loves a crisis.
[00:04:49] Speaker A: They do. Thank you, Alex.
[00:04:51] Speaker B: Thanks.
[00:04:52] Speaker A: And now moving on to ocean shipping. To help me with this, I'm joined by Gavin Van Marle. Now, last week was a busy one in the timeline of the strikes across Canada's east and west coast ports. I'm just going to run through this quickly. On Monday, Canada's Maritime Employers association imposed a lockout of their already striking employees at the Port of Montreal after its final offer to the dock workers was rejected last Sunday. And at this time, strikes were also ongoing on the west coast. And then on Tuesday, Canada's Labour Minister ordered the Canadian Industrial Relations Board, the cirb, to step in and end the strikes at the ports on the east and west coast. On Thursday, the CIRB directed the British Columbia Maritime Employers association, the BCMEA and all of its members and workers to resume operations and to continue until the board makes a final determination. No one really knows how long that process takes over on the east coast. It issued an order requiring operations to resume at the Port of Montreal effective 7am on Saturday. So over the weekend, the BCMA and the CIRB have scheduled a hearing for today, Monday, the 18th of November, to hear the party's concerns and hopefully we will get a decision shortly after. It's interesting to note a forwarder that we spoke to was quite annoyed about the timing of the intervention, saying it was clear that they'd have to get involved at some point, but they waited until the strike was in full effect before coming to the rescue. And this is quite reminiscent of what we saw a few months ago during the Canadian rail strike. And the forwarder said that it's kind of too late and the damage has been done. As we've seen, there have been a lot of boats at Anchorage outside the ports. And the brief closure of the ports has obviously meant that there is going to be lots of delays in getting the services up and running again. And we also had some movement on the looming US east and Gulf coast port strikes. So what's happened there with negotiations?
[00:06:38] Speaker C: Gav They've just broken down completely again. We had a notification on 13 November, sort of Wednesday evening That talks have been broken off between the usmx, the employers and the ila, the dockers union on that coast. At the moment, the deadline for these negotiations to be complete is the 15th of January when the three day stoppage came to an end. They've sorted out the wage increases. The issue now is automation. We're not entirely sure which aspect of automation talks have broken down over because the line gets blurred. Right. You know, if you start using, let's for example, use a calculator. Is using a calculator to do addition automation or should you do it by long edition?
Exactly right. But that would be automating your job. It's the same thing. Would you use video surveillance cameras? Would you have gangs of watchmen walking around the place with torches? Where does automation stop and labor begin? Should we get rid of trucks and everything gets done by horse drawn carriages or men pulling, you know, containers along? It's very odd and, but basically it comes down to this at the moment is that the employer's position is that it is seeking to use technology to modernize port operations. The ILA says they've got nothing against modernization, but they see these words as a Trojan horse, if you like, by which the employers can smuggle in automation and get rid of union jobs. I think the interesting thing really one, it shows just how concerned the ILA is with its membership numbers. Really important, don't forget all the union leaders, their pay levels are according to how many members are in the thing and obviously automation would lead to less membership. The second thing, and probably the most pertinent point for now, is that it means that the likelihood of a new strike on the US East coast and Gulf coast on 15 January has gone up by several fold. It suddenly means that there's this two week period in the second half of January next year, which just looked like an absolute maelstrom of different things. You're going to have probably an ILA strike on the 15th, three working days after that, Donald Trump gets inaugurated as president, bringing with who knows what mass deportations, closing borders, tariffs you then have. There was another one, wasn't it? Oh yeah, we've got Chinese New Year. It's late January, isn't it? And then there's the alliance reshuffle on the 1st of February. So you're going to have at least four major, both industry specific and geopolitical things coming together.
[00:09:28] Speaker A: And, and this is on top of the Red Sea crisis.
[00:09:30] Speaker C: And this is on top of the Red Sea crisis. It's on top of war in Ukraine and war in the Middle East. It really does look like it's going to be a real mess. It's going to be very interesting. It's going to be good for us. Good business.
[00:09:41] Speaker A: We also did some reports on cop 29 and I know you had some thoughts on this.
[00:09:45] Speaker C: Well, cop, I mean, I've had the greatest sympathy for our technical editor Charlie Bartlett this week who's been contracted to write some stories on cop. Previous cops we've attended in person and stuff. And there's been whole streams on shipping and transport and emissions in the supply chain this year. Absolutely nothing. It seems that with COP being held in Baku, capital of Azerbaijan, it doesn't appear that the Azeris have taken it particularly seriously. Argentina's left and has decided to withdraw from the whole thing altogether. That's Javier Milei following in the footsteps of Donald Trump, who withdrew the US from it when he was president before Charlie counted 1773 coal, oil and gas lobbyists milling around the summit this year. COP has been a sham, frankly. The French haven't turned up. The Argentines have withdrawn.
The guy who appears to be pressing the case for reduced emissions Most is the CEO of ExxonMobil.
Is it it to sum up Charlie's thing that next to the negotiations of COP 29, talks at shipping UN body, the international Maritime Organization, which is a byword for glacial movement, right. Appears to be moved forward, moving forward at a blistering pace. So basically, if the IMO nimble and swift in comparison to cop, then that just tells you what an absolute farce COP has become. Which I take no pleasure in saying.
[00:11:21] Speaker A: It would be funny if it wasn't so depressing and important.
[00:11:24] Speaker C: That's what I say. I say I take no pleasure in this because we could probably have some really good fun tearing it apart, but actually it's a disgrace.
[00:11:34] Speaker A: Well, moving swiftly on, was there any other major stories that we missed last week while in Miami enjoying the beach?
[00:11:40] Speaker C: Yeah, yeah, yeah. Well, okay. So we had a load of third quarter earnings results from the carriers. HAPAC reported, Yang Ming reported, Evergreen reported. Hmm. Reported. Wan Hai reported. Loads of people reported.
[00:11:53] Speaker A: Please don't go into all the figures.
[00:11:54] Speaker C: I'm not going to go into any figures. They're all doing well. That comes as no surprise to anyone because it's in the third quarter figures that all those earnings from the early peak season are being shown. They're all laughing all the way to the bank. The levels of laughter vary, but they've had a good quarter. To my mind, one of the There was an interesting deal. There was K. Nagel bought a US drayage provider called IMC Logistics. Drayage very quickly is the movement of containers from terminals to either depots or trucking yards or intermodal points. It's a very small thing, only happens in the US Absolutely critical part of the United States container supply chain. Without the drayage companies, nothing moves in or out of the ports. Very interesting to see a major freight forwarder make a play to own some of those assets in a very sensitive area. And so we've asked ourselves what are the sort of commercial implications of cunanagel buying into Drage? Because weirdly, right, a good portion of their customers are going to be the shipping lines. So suddenly you have poacher turned gamekeeper dealing with gamekeepers who have now turned poachers. Something like that. So that'd be fun. The other interesting one is cma. CGM said it was going to start going through the Red Sea and then it said it wasn't going to be going through the Red Sea, which we are postulating is due to insurers refusing to insure cargo that was going to be on a CMA service that went goes from India to the US east coast via so as instead they're going to continue routing round the Cape of Good Hope. And then finally I know that you're going to want to ask me about rates. I got nothing to say. They haven't changed. They haven't changed. They literally, they are flat. They are so flat, nothing's happened. They. They were just the same as they were a week before. Maybe there'll be some gris coming in beginning of December. Contract rate negotiations continue on Asia, Europe, but no movement on the spot rates to either support carriers or shippers.
[00:13:58] Speaker A: So listen to last week's episode if you want a recap of this week's race.
Thanks, Kev.
[00:14:05] Speaker C: Alright, cheers.
[00:14:13] Speaker A: So now we have recapped what was on the Lodestar last week. Here is what you might see come up this week. This week ocean carrier Zim will be announcing their Q3 results. I'm sure Gav will do some coverage of that. I will still have lots more stories to come from our time in Miami. We did a lot of interviews and attended a lot of panel discussions. So yes, still a lot more content to come. Themes might include how the new administration in the US might impact the supply chain and also how E commerce volume and high demand is impacting airport infrastructure. I also have an interview this week with Schiphol and they are a freight forwarder specializing in fresh produce. So I'm looking forward to chatting with them about the perishable market and what needs to be improved in that vertical. So look out for write up of that. We are still going to see the impact of the Canadian port strike linger, hopefully not for too much longer, but we are still awaiting the decision from the CIRB as to whether it will enforce binding arbitration. As I mentioned, there is a hearing today on the west coast, so we should hear some news very shortly. Finally, the DHL Global Connectedness Index will be out on Tuesday, so tomorrow. And this annual index shows the shifts in globalization and international activity. So I think it's going to be really interesting to observe the shifts from last year and the predictions for the next year coming, especially with the new Trump administration and the tariffs that he's planning on introducing. So I'm looking forward to reading that and I'm sure we'll cover it in one way or another. So you can look at the highlights on the Lodestar. Thank you so much for joining me this week and I'll see you next time.
