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LogisticsLogistics

Seaports Expect Early Peak; Walmart Gets Airborne; Food Exports Curbed

By Paul Page

 

The APM Terminals container terminal at the Port of Los Angeles last November. PHOTO: DAMIAN DOVARGANES/ASSOCIATED PRESS

America’s seaports are bracing for an early start to the peak shipping season with their operations already stretched. Port executives say importers have been ordering earlier this year to get ahead of potential bottlenecks this fall. The WSJ Logistics Report’s Paul Berger writes the shipments aimed at the series of shopping landmarks that begin in late summer will arrive at gateways that have seen persistent and spreading backups. Vessel backlogs at the heart of U.S. supply-chain congestion have receded in some places, but they have reared up in others. That includes East Coast ports that shippers have turned to as alternatives to the backlogs at West Coast gateways. One bright spot is that port officials say they believe are better prepared this summer to deal with an import surge after more than a year of juggling clogged docks, vessel backups and record inbound volumes.

  • Some container shipping lines will skip port calls in the U.S. and Canada next month amid persistent congestion at gateways. (Journal of Commerce)
 

Quotable

“We’ve got to start digging into this backlog pretty quickly.”

— Gene Seroka, executive director of the Port of Los Angeles
 
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Transportation

PHOTO: WALMART

Walmart’s latest plan to speed up deliveries to homes is literally up in the air. The retailer is expanding its drone delivery operations to some 4 million households in six U.S. states, the WSJ’s Will Feuer reports, pushing Walmart into an airborne competition with Amazon and other parcel carriers. Walmart says it will be able to deliver more than 1 million packages a year by drone under an expanded partnership with DroneUp, which began operating drone-delivery hubs out of Walmart stores in Arkansas in November. The new plan will cover households in parts of Arizona, Arkansas, Florida, Texas, Utah and Virginia. The service marks a significant step in bringing drone delivery into standard commercial use. Even Walmart has been surprised at how quickly customers have taken to delivery for “sheer convenience, like a quick fix for a weeknight meal” rather than strictly for emergencies.

 
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Economy & Trade

A laborer unloads wheat at a wholesale grain market in New Delhi. PHOTO: MAYANK MAKHIJA/ZUMA PRESS

A cascade of restrictions on food exports around the world threatens to add new strains to fragile global food supply chains. Countries have enacted a wave of export curbs on food since the start of the Ukraine war, the WSJ’s Jason Douglas, Jon Emont and Vibhuti Agarwal report, as they try to ensure domestic supplies amid growing disruptions and food-price inflation. On nearly every continent, nations have restricted or barred products ranging from wheat, corn and edible oils to beans, lentils and sugar. Lebanon even banned the export of ice cream and beer. For governments, the actions are aimed at soothing public anger. Economists say restrictions on food exports inevitably push global prices up further as importers buy what they can from reduced supplies. Export curbs can create other problems. An Indian ban on wheat exports triggered a massive backup of some 4,000 wheat-laden trucks outside a port.

  • Malaysia will halt chicken exports starting June 1 in a bid to restrain domestic costs. (Straits Times)
  • Scarce wheat supplies are leaving Egypt short of the bread that is a staple for the country. (WSJ)
  • Food banks in the U.K. are straining for supplies as rising fuel and grocery costs have more people seeking help. (Associated Press)
 

Here are recent developments following Russia’s invasion of Ukraine:

Russian forces were pushing to encircle two cities in eastern Ukraine on Wednesday, part of an all-out Russian assault in an effort to take control of the Donbas region. (WSJ)

European Commission President Ursula von der Leyen says Russia is engaged in food blackmail by “holding back supplies to increase global prices, or trading wheat in exchange for political support.” (WSJ)

Russian fuel oil exports to Greece reached a new high in April, with ship-to-ship (STS) transfers becoming more common. (TradeWinds)

The Russian parliament moved toward approving legislation that would allow the state to nationalize the assets of foreign companies that have left Russia. (WSJ)

For the latest updates from Russia and Ukraine, click here

 
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Number of the Day

115.8

American Trucking Associations for-hire truck tonnage index for April, down 2.4 from March and the first decline in nine months.

 

In Other News

Factories in Europe and Japan report weakening new orders while spending on services is growing. (WSJ)

Sales of new homes in the U.S. fell at the steepest pace since 2013. (WSJ)

Two S&P measures show the U.S. economy weakening this month. (MarketWatch)

Glencore will pay at least $1.2 billion as part of agreements to resolve criminal probes involving bribery and price manipulation in its global mining and trading business. (WSJ)

Electronics retailer Best Buy lowered its outlook on changing consumer buying patterns and rising supply-chain costs. (WSJ)

Boeing’s safety chief says changes under way at the plane maker should prevent engineers from designing another automated cockpit system without sufficient safeguards. (WSJ)

Some Asian manufacturers say the pandemic-driven boom in overseas demand is fading. (Bloomberg)

Toyota will cut its global automotive production by about 100,000 vehicles in June because of the chip shortage. (Reuters)

Car maker Stellantis and Samsung will team up on a $2.5 billion plant for electric-vehicle batteries in Indiana. (Detroit Free Press)

Amazon shareholders at this week’s annual general meeting will challenge the company on executive pay, tax transparency and warehouse working conditions. (Financial Times) 

Trans-Atlantic airfreight rates are falling as airlines ramp up passenger flights and load factors slide. (The Loadstar)

Environmental groups want U.S. regulators to bar the transport of liquefied natural gas by rail. (Progressive Railroading)

A federal trial began over a trucking-industry suit against highway tolls aimed at big rigs on Rhode Island highways. (WPRI)

APM Terminals is expanding its container capacity at Alabama’s Port of Mobile by about a third. (DC Velocity)

Latin American digital freight forwarder Nowports raised $150 million in a Series C funding round that values the business at $1.1 billion. (TechCrunch)

Argentina-based shipment tracking technology startup clicOH raised $25 million in a Series B funding round let by Tiger Global. (Grit Daily)

Chanel plans to open boutique stores for only its top customers because rapid sales growth threatens to make its stores overcrowded. (Business of Fashion)

 

About Us

Paul Page is editor of WSJ Logistics Report. Write to him at paul.page@wsj.com.

Follow the WSJ Logistics Report team: @PaulPage and @pdberger. Follow the WSJ Logistics Report on Twitter at @WSJLogistics.

 
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