World Trade Volume Back to Pre-Corona Levels
According to the Netherlands Bureau of Economic Policy Analysis, global trade volume has surpassed the level before the new coronavirus disaster. In the spring of last year, the Corona disaster caused a cooling of demand worldwide, and production adjustments proceeded. However, with the resumption of economic activity, not only has consumption which had been postponed returned, but the recovery of inventories has become more active.
Production and trade have suddenly picked up. China was the first country to recover quickly from the Corona disaster. In the January-March period, both imports and exports reached record highs. The U.S. has also seen a significant increase in imports from China and other Asian countries.
According to the Nippon Kaiji Center, container transport from 18 Asian countries and regions to the United States will be at a record high. Over 20% is related to housing, such as furniture, household goods, and construction tools. The U.S. housing market is booming because of a combination of low interest rates and another factor is that people relocated to the suburbs due to the Corona disaster.
As housing starts to increase, the demand for related materials in the U.S. increases. Furthermore, the growing demand for electrical appliances due to ”stay home consumption” also increases container transportation.
West Coast ports in North America
West Coast ports in North America are on the verge of being punctured by a surge in cargo from Asia as cargo movement on a container routes to the U.S. continues at record levels. At ports such as Los Angeles and Long Beach, congestion in terminals has worsened, causing cargo to be held up, and connections to railroads have also been delayed.
Inquiries for east coast services are also increasing rapidly due to dysfunction via the west coast, and new bookings are not coming in at all, causing widespread confusion. According to a shipping company official, ”New bookings for spot cargoes during May, including those from Asia, are almost impossible.
The prevailing rate for spot freight from Asia to the East Coast of North America, has risen to $10,000 per 40-foot container.
Zero greenhouse gas by 2050
Further acceleration of decarbonization in global logistics.
At a special meeting held on April 21 in preparation for the Climate Change Summit, representatives from 10 countries exchanged opinions on how international shipping can combat global warming. Among them, U.S. special envoy John Kerry proposed an ambitious goal of reducing greenhouse gas emissions from international shipping to zero, by 2050.
This goal which surpasses the IMO’s (International Maritime Organization) greenhouse gas reduction strategy is likely to accelerate the decarbonization of international shipping. In response to this goal, some people involved in the project have said that, it may give impetus to the research and development of environmental technologies.
The demand for drivers in the U.S.
The demand for drivers in the U.S. is increasing rapidly. Raising wages to secure drivers, U.S. trucking companies are scrambling to hire more drivers to revive the freight market as consumer demand surges and shipping capacity tightens. Knight-Swift Transportation Holdings Inc., a major player in the industry that has raised wages, reported that wages for newly qualified drivers have increased by more than 40% in recent months.
According to the Bureau of Labor Statistics, the median salary for drivers of heavy trucks and trailers last year was $47,130 dollars. Still, the company reports that even newly licensed drivers can now earn more than $60,000 dollars a year in their first year of training.
Automated Truck Driving
Automated Truck Driving is also attracting attention. TuSimple, a company with offices in U.S. and China, had its Initial Public Offering on April 12, selling about 33.8 million shares and raising $1.08 billion dollars.
A company official said it plans to conduct a ”driver-out” pilot program this year in the fourth quarter, with no one driving over a distance of about 100 miles between Tucson and Phoenix. He said the pilot program will transport customer cargo and is being coordinated closely with Arizona transportation authorities. The company is continuing to develop new technology and expects its first commercial revenues in 2024.