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From FedEx's new demand surcharges shaking up holiday shipping costs to a potential seaport strike threatening to disrupt supply chains, there’s a little bit of everything in this week’s news rundown. We'll look at the shift towards cost-effective shipping methods, peek into the future of freight rates, and examine how the air cargo industry came out of the Crowdstrike IT outage relatively unscathed. Plus, we’ll give you the inside scoop on Amazon's 2024 peak season fees and China's consequential move to limit exports of vital minerals. Let’s get this started.
Brace yourself for FedEx's latest round of holiday surcharges. These new fees will hit your budget harder than what you bought last year for your eccentric aunt. Let's break down the costs you'll face and how they'll affect your shipping strategy this season.
FedEx is charging everyone extra, no matter who you are. From October 28 to November 24 and December 30 to January 19, you'll pay $0.30 more for each Home Delivery and Ground Residential package. During the peak rush (November 25 to December 29), that jumps to $0.55. Express shipments? Hold onto your wallet. You're looking at $1.00 extra per package during the outer periods and a steep $2.00 during peak weeks. Ground Economy users aren't spared either, with surcharges up to $3.15 per package during the busiest five weeks. These fees stack on top of existing charges, so your total cost might shock you.
If you ship in volume, prepare for a serious price hike. Even a small increase over your baseline could cost you $1.45 more per Ground package and $2.60 for Express. Ship over 400% of your baseline in a week? You're facing $7.10 and $8.25 extra per package. FedEx bases these charges on your shipping volume from June 3 to June 30, 2024. They'll calculate fees weekly starting October 7, applying them for 12 weeks straight. The takeaway? The more packages you send, the deeper you'll dig into your pockets.
The United States Postal Service faces a new reality as shippers abandon speed for savings. Recent quarterly results reveal a shocking 40.7% plunge in Priority Mail Services volume, signaling a major change in shipping preferences. Why does this matter, and does it mean a lot for the future of package delivery?
Gone are the days when "fastest delivery" reigned supreme. USPS's Priority Mail and Priority Mail Express services, once the go-to for quick shipments, now struggle to compete. As shippers increasingly choose slower, more affordable options, causing expedited volumes to nosedive, the USPS has no other choice but to adapt or risk falling behind.
While express services stumble, ground shipping emerges as the unlikely winner. USPS Ground Advantage saw growth, contributing to a modest 2.7% uptick in overall shipping and packages volume. This trend echoes across the industry, with giants like UPS and FedEx reporting similar "trade-downs" to more economical shipping methods. And it makes sense why: smart inventory placement and improved ground networks make slower shipping a viable option for cost-conscious businesses and consumers alike.
A storm is brewing at U.S. seaports, and it's not just about the weather. Experts are sounding the alarm about possible cargo chaos with a potential strike on the horizon.
45,000 dockworkers at 36 seaports from Texas to Maine are ready to drop their tools on October 1st if they don't get a new contract. That’s why big retailers like Walmart aren't taking chances and are rushing to get their goods on U.S. soil before September 30th, when the current union contract expires. However, even a short strike could create a massive backlog. Experts at Sea-Intelligence say a one-week strike in early October could keep ports clogged until mid-November. And if it stretches to two weeks? We might not see normal operations until 2025.
Companies are paying through the nose to avoid this potential mess. Sending a 40-foot container from the Far East to the U.S. East Coast shot up from $2,100 in early April to over $10,000 in early July. Talk about sticker shock! And it's not just about money — time is ticking too. With shipping routes changed due to attacks in the Red Sea, it can take 45 days or more for goods to reach East and Gulf Coast ports from Asia. Shipping analyst Peter Sand puts it bluntly: sending cargo next week might be too late — it could end up bobbing in the ocean if strikes hit. So, will your holiday gifts make it in time, or will they be caught in this perfect storm?
The trucking industry may finally catch a break. Experts predict a long-awaited upswing in freight rates, with 2025 shaping into a pivotal year for carriers. After a stretch of challenging market conditions, there’s finally a forecast offering a ray of hope.
FTR's June Trucking Conditions Index paints an intriguing picture. The index registered 0.95, down from May's 2.24, but remained in positive territory. This seemingly modest figure actually hints at improving fundamentals for trucking companies and sets the stage for stronger performance ahead.
While 2024 might bring some volatility, 2025 stands out as a potential inflection point. Avery Vise, FTR's vice president of trucking, highlights increasing capacity utilization as the key driver for sturdier freight rates. His prediction? By next spring, carriers should find themselves in "considerably more favorable conditions." Though not quite matching 2021's extraordinary boom, this upturn promises much-needed relief for an industry ready for better days.
Remember when your Wi-Fi went out, and your whole day fell apart? Now, imagine that happening to the entire air cargo industry. That's exactly what went down this July with the Crowdstrike outage, but instead of crumbling, these sky-high haulers bounced back with a vengeance and saw demand soar 13% year-over-year.
Picture this: a massive IT crash grounds flights worldwide. Suddenly, everyone's scrambling to get their stuff moved. It's like Black Friday, but for shipping pallets. This frenzy sent prices rocketing to $2.70 per kilo — the highest of the year. Evidently, panic buying isn't just for toilet paper anymore.
Air cargo's momentum shows no signs of slowing, with e-commerce volumes from Asia continuing to drive activity. Xeneta reports that elevated demand could persist through September, partly due to 2023's low benchmark. July saw the sixth consecutive month of rising spot rates, averaging $2.66 per kilogram — a 20% jump from the previous year. Southeast Asia to North America routes also experienced an eye-popping 100% year-over-year increase, reaching $5.78 per kilogram.
Amazon's yearly holiday price hike tradition marches on. The e-commerce giant dropped a bombshell last week, announcing another round of peak season fees for third-party sellers using its fulfillment services. Starting October 15, 2024, and running through January 14, 2025, these extra charges could add anywhere from spare change to several dollars per item.
Amazon's peak season fees will hit multiple services hard. Fulfillment by Amazon (FBA) in the U.S. and Canada, North America Remote Fulfillment, U.S. Multi-Channel Fulfillment, and Buy with Prime orders all fall under this umbrella. The price hike varies based on product size, with larger items taking the biggest hit. A small standard item like a mobile phone case will now cost $3.34 instead of $3.15. T-shirts, classified as large standard items, jump from $4.67 to $5.00. Bulky products feel the squeeze even more — a baby cot rockets from $12.27 to $13.31. But the real sticker shock comes for extra-large items: a monitor weighing 50-70 pounds now carries a whopping $54.18 fee, up from $51.37. What’s more, sellers should pay close attention to timing. These fees kick in when items leave Amazon's warehouses, not when orders are placed. So even if a customer taps "buy" on October 14, the peak season fee still applies if the package ships after the cutoff date.
While Amazon frames these fees as a necessary evil to cover increased operational costs, there's more to the story. This year's holiday shopping season is unusually compressed, with fewer days between Black Friday and Christmas. Amazon's gearing up for a potential order tsunami by pushing earlier inventory deadlines for sellers. The message rings loud and clear: expect a holiday shopping sprint, not a leisurely marathon. Whether these fees translate directly to higher prices for consumers is anyone's guess, but smart shoppers might want to snag those deals before the October 15 fee hike hits. The clock is ticking.
China has the global supply chain on notice. Starting September 15, they're putting the brakes on antimony exports — a critical ingredient in everything from car batteries to night vision goggles. Understandably, many countries are in a panic as they scramble to secure new sources of this versatile mineral.
You might not know it, but antimony is the unsung hero in your everyday devices and some serious military hardware. It's the secret sauce in lead-acid batteries keeping your car running and the key component in machine bearings that keep factories humming. But that's just the tip of the iceberg. Antimony plays a crucial role in producing explosives and even nuclear weapons. With China controlling nearly half the world's supply in 2023, this export limit throws a wrench in global supply chains.
Countries aren't sitting idle as China tightens its grip on antimony. The U.S., wary of over-reliance on Chinese imports, has been cozying up to India for antimony ingots. Meanwhile, Europe is diversifying its sources, tapping into suppliers from Vietnam, Myanmar, and Tajikistan. It's a high-stakes game of mineral musical chairs until the music stops on September 15.
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