Ocean carrier Hapag-Lloyd issued a notice on the increased demand for trucks as a result of this labor slowdown. And Maersk reported it would “absorb” the stoppage at its German terminals, telling customers that “in the interest of minimizing any further disruption to your supply chain, we will be keeping a close eye on developments up to and during the next round of meetings between trade union ver.di and ZDS, acknowledging that further strike action is possible.”
The U.S. logistics system continues to have its own host of issues with persistent rail problems, chassis shortages, and warehouses at capacity.
“Consumer trends are changing,” explained a senior consultant at Proxima. “Buying patterns have shifted from home, electronics, casual apparel to more services. We are seeing buying apparel for travel and cosmetics coming back to pre-pandemic levels. Luggage, sunscreen, and bug spray are items in higher demand because consumers need them in their experience pursuits. Larger appliances are not being purchased anymore. It’s an interesting dynamic to see how quickly the consumer has flipped considering what is going on in the economy.”
Despite the historic volume of containers, a pullback is expected as future orders for Chinese manufacturing have dropped anywhere from 20% to 30%, according to shippers surveyed. Lumber orders have been cut along with orders for furniture, appliances, and DIY products.
“But for other sectors like garments, sporting goods, and e-commerce, they are still seeing strong demands,” explained a senior vice president of products for Asia-Pacific.
The CEO of the American Apparel and Footwear Association explained the continued strength in orders is a result of consumers looking to outfit themselves for experiences like back to school, back to in-office work, and travel. But despite this demand, the impact of inflation is a top worry.
“We remain deeply concerned that persistently high prices — in our sector and throughout the economy — will begin to dampen consumer spending and harm American families,” the American Apparel and Footwear Association said. “That is why, with consumers still being a driver for economic growth in our economy, we continue to push for the administration to avail itself of all its own inflation-cutting tools, including relief from the high and regressive tariffs that are currently being charged on products in our industry.”
CEO of a reliable source tells American Shipper that the decrease in container volume is being seen. They are seeing a drop from 30-50 FEU per week down to 10 FEU per week by some customers. The squeeze is on. Time to pop that aspirin.