Carrying over from a transportation-booming two years, 2022 is showing no signs of slowing down. While the congestion and disruption will follow with the screaming demand for imports, we’re expecting what we have come to know as “business as usual” since the pandemic.
The Ports of Los Angeles and Long Beach California had 101 container ships waiting for berth at the beginning of January and the Trans-Pacific spot rates quoted were higher than December. And while these numbers have seen a steady decline throughout February, annual contract rates are up sharply and Asia-US contract rates are up 122% from 2020 before COVID-19 hit our shores.
With the Biden administration making moves to transition to clean energy for the entire country by 2050, and carbon neutrality for the power sector by 2035, this ambitious goal is a critical step towards improving the infrastructure of the US. The $1 trillion Infrastructure Investment and Jobs Act was signed into law on November 15, 2021, to spend money on roads, public transit, electric vehicle charging networks, and safe drinking water. A full $65 billion of it was set aside for clean energy transmission infrastructure and updating the electric grid.
Labor struggles will continue as variants arise and subside forcing staff to revamp worker schedules and requirements to meet the evolving needs of the pandemic – especially with China’s aggressive Zero-Covid policy. There can be serious delays caused by the instant reductions in staff to meet that policy. Now with the attacks on Ukraine by Russia, more chaos has been thrown into the mix.
The critical question in any outlook is where demand will be throughout the year. If demand stays strong, container, air, and truck shipments will continue to experience delays and escalating congestion. If demand drops to manageable levels then carriers and shippers will be able to catch up, but that also means we’re looking at a possible recession which can bring another plethora of issues to logistics.
In such a volatile logistics market, you need an experienced professional team at your back to ensure you’re protected and your cargo keeps moving. RS Express acts as both an expert and advocate on behalf of our customers no matter what the situation is. Being flexible even when planning ahead gives us the ability to proactively plan for contingencies and protect our clients. If you want to know what RS Express can do for you in 2022 contact us at [email protected] or by phone at 630.350.9111.