- On the resource side, the U.S. added 266,000 payroll jobs in April. The call to discontinue the Federal supplement to unemployment insurance is spreading. In addition, reinstatement of work search requirements are being activated.
- As reported by the U.S. Department of Labor, the number of job openings reached a high of 8.1 million at the end of March. Coupled with little change in quits, layoffs and discharges and other separations the need for workers is a key challenge for supply chains.
- There are currently 79,822 truck driver jobs posted in the U.S. on glassdoor.com.
- At the time of this writing there are 19 container ships waiting to be offloaded at the Port of Long Beach.
- Old Dominion has announced a $275 million expansion that focuses on adding 4 to 6 new terminals.
- Egypt has officially unveiled plans to expand and deepen the Suez Canal. With 12% of world trade passing through the Suez Canal, the investment to deepen the canal to 72 feet and widen the southern part of the canal to 44 meters, will mitigate future risks of canal blockages.
- Per the U.S. Bureau of Labor Statistics, the price of imports rose .7% in April on non-fuel prices while real average hourly earnings for all employees remain unchanged for April.
- If have you haven’t been to your local lumber yard recently, you may be surprised at the cost of lumber. Lumber has skyrocketed hitting a record high on May 3rd after the Chicago Mercantile Exchange removed limits on lumber futures. Price per board foot rose a $100 per 1,000 board feet.
- In acquisition news, DSV Panalpina A/S agreed to buy Agility Public Warehousing Co.’s Global Integrated Logistics business for $4.1 billion. DSV stated the purchase will increase its market share in the freight forwarding industry to 4-5%.
- In the larger retail market, a report by Edge by Ascential, is forecasting that Amazon will become the U.S.’s largest retailer by 2025, pushing Walmart from the top spot with a projected sales volume of $632 billion
- Container News is reporting rate indexes from China to the U.S. have now become pointless. Rate indexes are reflecting $4,300 to $5,600, however spot rates driven by premiums are pushing container rates over $9,000 USD. Projections are the situation will not improved until 2022 due to shortages on containers, a lack of vessel capacity and port congestion.
Editor’s note: Don’t let a decision made be the last word. What appeared to be a final edition of our monthly Digest in April has now been rejuvenated into a more condensed version for our audience. If there are any topics you would like the Rockfarm team to cover more in depth in our monthly Digest or in our weekly one-pagers please let us know at firstname.lastname@example.org…and don’t forget to follow us on LinkedIn.
While fuel has continued to stay steady at its new norm of $3.15 average, the truckload cost per mile index showed some relief in April, falling to $2.99 per mile. The question before us is: “Is this a temporary reprieve or will we see another bump in rates as we head into the summer?” Midway through May, the Rockfarm Truckload Index is holding steady at $2.98 per mile. Coupled with diesel staying relatively steady at last week’s high of $3.16 per gallon, we can state we are, in fact, seeing a true rate decrease.
Many challenges remain: port backlogs continue alongside regional spikes in rates that are still impacting shippers as truck capacity remains tight. Combine that with being hit with the unexpected, as in last week’s gas pipeline, and Memphis bridge shutdowns, or the Suez blockage earlier this year, and we realize quickly the fragility of our supply chains.
On the forecast front, Q1 inventory levels were revised slightly by the U.S. Census Bureau in the May report, which showed the inventory to sales ratio at 1.23, only a small change from February. The end result is sales are strong and inventory levels are still not built up, which forecasts a strong summer ahead with capacity remaining tight.
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