Transpacific Air Trade Continues at Double-Digit Rates: Space remains tight as Asia prepares for their Labor Day holiday on May 1st (businesses are closed on Monday, May 3rd). Larger shipments will find it difficult to find space for the next 1-2 weeks out. While costs have not necessarily increased this week, it is difficult to predict when the rates will decline. The published per kilogram rate from China and Hong Kong remains between $11-$12.
In Case You Didn’t Know How Bad it is at O’Hare: It is taking airline handling agents in Chicago, approximately one week to sort inbound cargo. This means that in many cases door to door transit times are increasing by up to seven days.
This problem is due to a whole host of factors – cargo volumes are up 14% this year, warehouses are short-staffed, hiring additional staff is challenging, and O’Hare has been historically susceptible to congestion issues due to lack of sufficient and modern infrastructure.
Exports are not much better off. Extensive cargo drop-off waiting times are driving additional costs for the customer, missed cutoffs, and delayed cargo. In some cases, after finally reaching the counter, the shipment is rejected due to lack of space on the warehouse floor.
Airline terminals are desperately attempting to catch up. Some warehouses have reduced pickup and receiving times in effort to find more time to sort and make freight available. While this may help a bit, it has a negative effect on the truckers that have been already sitting in lines for hours. In perhaps a more logical attempt to solve these issues, China Eastern and China Cargo have rented warehouses in the surrounding area to hold and handle the overflow.
In the meantime, as cargo piles up, you should not be surprised to find yourself navigating around freight that is sitting in the parking lot waiting for room to open up inside.
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