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North American Sea Freight Market Strained

The North American sea freight market faces ongoing challenges, with recent labour actions on the US East Coast fuelling local anxieties and adding congestion and capacity pressures on the West coast.

The three-day strike by the International Longshoremen’s Association (ILA) on the US East Coast in early October sent ripples across the industry, as importers scrambled to reroute shipments to West Coast ports. Record-breaking import volumes in Los Angeles and Long Beach in September have strained rail and terminal operations, pushing rail container dwell times over nine days, their highest in two years.

The impact of the ILA strike is compounded by recent actions in Canada, with Montreal dockworkers initiated a 24-hour strike last Sunday the 27th October, following earlier disruptions that have halted overtime work across the port. 

This seasonal surge in imports is expected to taper off in November, as most holiday merchandise arrives in the US by late October to be available for Black Friday and other peak shopping events. However, if contract negotiations between the ILA and East Coast employers, which are due to resume in November, remain unresolved into December, West Coast ports could capture a larger share of shipments, keeping demand elevated longer than usual on the Pacific Coast.

The main issue outstanding between the ILA and USMX is the use of terminal automation. The previous contract permitted semi-automation with union and terminal agreement on staffing but banned full automation. In this bargaining cycle, the ILA is pushing for a complete ban on all automation types.

Montreal’s container volumes have already dropped by nearly a quarter since 2022, with a growing shift of cargo to US East Coast ports—though the labour situation in the US may ultimately reverse this trend if Canadian ports gain relative stability.

Impact of the US presidential election on container shipping
Looking ahead, next week’s US presidential election introduces potential regulatory and economic uncertainties for the container shipping market. A second term for Donald Trump could bring a more protectionist stance, with proposed tariffs of up to 20% on all imports and as high as 60% on goods from China. Such policies would likely dampen US demand for imports, reshaping sourcing and supply chain strategies across Asia, where countries like Vietnam and India are already gaining market share as businesses diversify away from China.

By contrast, a potential administration under Kamala Harris is expected to support US industries through subsidies rather than aggressive tariffs, reducing the immediate risk of sharp import declines. However, increased government support for domestic production could still influence trade patterns, with downstream effects on global shipping demand. In either scenario, US trade policies will continue to play a significant role in shaping the container shipping market, particularly in trans-Pacific routes.

As North America’s sea freight market adapts to labour uncertainties and fluctuating trade policies, shippers face a complex landscape of demand pressures, capacity constraints, and fluctuating costs.

As always, we will guide you through the most import strategic adjustments, such as diversifying shipping routes and anticipating regulatory changes, to maintain supply chain stability and manage costs in the months ahead.

To discuss the current situation and how Metro can protect your North American supply chain, please EMAIL Andrew Smith, Chief Commercial Officer.

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UK Freeports Offer New Opportunities for Businesses

The new labour government has confirmed its commitment to the ‘Freeports’ initiative that aims to stimulate economic growth, by offering an array of incentives, from tax relief on investment to National Insurance contributions (NICs) relief on employee earnings.

With eight Freeports now operating in England and two each in Scotland and Wales, and further developments planned, the Freeports programme represents a promising approach to support industries, promote innovation, and create jobs in strategic locations.

Tax and Customs Advantages for Businesses
One of the most attractive features of Freeports is the tax relief on employer NICs. Employers can claim NICs relief on up to £25,000 of eligible employee earnings per year for up to 36 months, reducing operational costs and incentivising companies to grow their workforce locally.

Additionally, Freeports allow businesses to import materials tariff-free and defer customs duties until goods enter the domestic market. This creates an efficient system for businesses handling raw materials or intermediate goods, particularly those involved in exporting and manufacturing.

Regional Economic Regeneration
Freeports are designed to act as catalysts for regional development by attracting investment and encouraging innovation in specialised sectors. For instance, the Humber Freeport focuses on rare earth metals processing, supporting the UK’s green technology ambitions. Teesside Freeport, meanwhile, is set to become a hub for offshore wind turbine manufacturing, aligning with national renewable energy goals. In Wales, Freeports like the one on Anglesey are driving investments in solar and tidal power, helping to revitalise local economies that have been affected by industrial decline.

Freeports As Strategic Investment Zones
Beyond customs advantages, Freeports benefit from flexible investment rules and tax breaks on building and equipment investment. With recent government commitments to fund these areas as part of broader investment zones, Freeports provide businesses with opportunities to scale their operations, enhance productivity, and foster long-term economic impact.

The ongoing improvements are expected to create further incentives for businesses to establish themselves within Freeports, fostering an environment of innovation and competitiveness.

A Growing Attraction for Businesses
While initial uptake has been gradual, UK Freeports have already secured over £6 billion in investment and created around 7,000 jobs, with significant growth potential still untapped. The customs benefits, combined with substantial tax reliefs, make Freeports a compelling option for businesses looking to expand within strategically important sectors.

We are closely monitoring the development of Freeports and their potential benefits for our customers’ supply and value chains. Exploring cost-effective, value-added operations is always worthwhile, and some Freeport locations may present advantageous shifts in operations, provided that process, financial, and compliance factors align favourably.

Our supply chain, finance, and customs teams are ready to offer expertise, insights, and guidance on Freeport opportunities. For further insights, please EMAIL Elliot Carlile to discuss your situation and explore the most beneficial options.

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Strengthening Global Network to Address Supply Chain Challenges

Metro’s strategic partner network is central to delivering market-leading logistics services, especially as global supply chains face ongoing challenges. With the appointment of Peter Orange as head of global network development, Metro is deepening its commitment to building robust partnerships worldwide, enhancing collaboration, and strengthening its network’s resilience to meet customer needs.

Highlighting the significance of Metro’s partner network, managing director Grant Liddell and chief commercial officer Andy Smith recently completed a ten-day trip across Asia. During the visit, they met with key partners, carriers, and customers to strengthen relationships and gain valuable insights into regional market dynamics.

This focus on building connections comes at a time when supply chains are under persistent pressure, making agile, strategic partnerships essential to delivering reliable service.

Peter Orange’s new role: Deepening global partnerships
With over three decades of experience spanning airlines and logistics firms across diverse regions—including Australia, Singapore, UAE, and the UK—Peter Orange brings a global perspective to his role as head of global network development. His mandate is clear: to enhance Metro’s engagement with existing partners and explore potential new alliances, particularly those that bring specialised expertise in verticals like automotive and high-tech.

Peter’s appointment reflects Metro’s commitment to fostering like-minded partnerships that prioritise value, service reliability, compliance, and transparent communication. As part of this role, Peter is reviewing existing partner relationships, assessing shared business strategies, and aligning efforts across transport modes—whether air, ocean, or combinations—to ensure Metro’s global partnerships are primed to adapt to dynamic market demands. He is also leading a continuous evaluation process with core partners, holding regular reviews to assess market opportunities and align on growth objectives.

Building on this foundation, Metro plans to expand Peter’s team with route development managers who will focus on key regions, including Asia Pacific and EMEA, alongside the current emphasis on North America. This team will work closely with Metro’s partners to drive sales, share market intelligence, and set clear growth targets, reinforcing Metro’s strategy of data-informed and relationship-driven expansion.

Insights from Metro’s Asia trip
In September, Grant Liddell and Andy Smith travelled to Singapore, Shanghai, and Hong Kong to meet with Metro’s Asian partners, customers, and major carriers. The trip provided valuable insights into the region’s logistics landscape, particularly with regard to the effects of eCommerce growth on airfreight demand and the impact of ocean capacity adjustments driven by regional geopolitical issues.

A notable takeaway from their discussions was the continued strength of eCommerce in driving airfreight demand, particularly on routes from Asia to Europe and North America. This trend is keeping rates elevated and creating heightened capacity needs. In ocean freight, major trade routes are seeing increased rates due to strong demand and capacity constraints, with factors like the Red Sea diversions further tightening supply. The expectation is that these pressures will persist into Q4, reinforcing the need for strong partnerships and agile strategies.

Metro’s commitment to building a resilient partner network ensures that customers benefit from agile, robust global supply chains, capable of adapting to shifts in demand and overcoming potential disruptions.

With Peter Orange leading this effort, alongside Metro’s strengthened ties in Asia, we’re dedicated to adding value and positioning our customers for success in today’s dynamic logistics landscape.

To explore how Metro’s partnerships can support your business needs, please EMAIL Peter Orange for more information.

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Labour tensions rise on North America’s East coast

Ongoing labour disputes on the US East Coast and Canada’s Port of Montreal continue to threaten disruptions to North American supply chains.

The agreement between the ILA and the United States Maritime Alliance (USMX) on the US East coast (USEC) brings temporary relief, securing peace for the next three months. The wage increase of over 60% marks significant progress, but the contentious issue of automation remains unresolved and could lead to further disruptions when the current contract extension expires on 15 January 2025.

With over 60 ships backed-up during the strike, ports have been working hard to clear the backlog. They have been aided by spare capacity, which has been created by shippers front-loading and cargo diversions.

In many cases the ports extended operational hours to process delayed vessels, ensuring that the backlog will not stretch far into the busy holiday season.

Meanwhile, the Port of Montreal is bracing for an indefinite overtime strike that started on 10 October, following earlier strike actions that halted operations at two terminals. The port’s longshoremen are using the strike to pressure employers amid slow-moving negotiations, which have dragged on for over a year. This escalation threatens to further disrupt operations at Canada’s second-largest port, affecting supply chains and causing delays for transatlantic trade.

While some carriers have suspended their Emergency Operations Surcharges on the USEC, several have announced peak season surcharge (PSS) hikes. Maersk, CMA CGM, and MSC are introducing increased surcharges of up to 15% from Europe, the Mediterranean, and other regions to North America.

Some carriers have rerouted cargo to alternative ports to mitigate delays, and flexibility will be crucial as labour disputes continue. The ILA’s extension of negotiations to January, just before Chinese New Year shipping demand, suggests potential for further congestion and delays in the coming months.

The combination of vessel congestion, labour disputes, and surging rates highlights the importance of adaptable logistics strategies in today’s volatile shipping environment.

Metro works with shippers to overcome rising freight rates and operational uncertainty, with innovative solutions and proactive planning to keep supply chains flowing.

We have contingency plans in place to avoid the ports likely to be most affected by strikes, as well as alternative routes and entry points.

To discuss these issues and how Metro can protect your supply chain, please EMAIL Andrew Smith, Chief Commercial Officer.