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Canadian News
April 25th, 2024
Total Freight Costs Decrease in February
Results published today by the Canadian General Freight Index (CGFI) indicate that the Total Cost of ground transportation for Canadian Shippers decreased by 1.25% in February, as compared with January.The Base Rate Index, which excludes the impact of Accessorial Charges assessed by carriers, decreased by 1.06% in January.Average Fuel Surcharges assessed by Carriers increased in February. Fuel was 25.85% of Base Rates in February versus 25.54% in January. Last year in February, the Average Fuel Surcharge was 29.27%.“Total Freight Costs decreased by 1.25% in February. Total Domestic LTL increased, while Total Domestic Truckload, Total Cross Border LTL and Total Cross Border Truckload decreased. Year over year, Total Domestic LTL remains above last year while, Total Domestic Truckload, Total Cross Border TL & Total Cross Border LTL, segments remain below the costs for the same period last year,” said Doug Payne, President & COO, Nulogx.
Overall Fuel Surcharge Index
Canadian General Freight Index
This is a summary showing Total Freight Costs for over the road shipments starting in January 2008.
This chart depicts only General Freight shipments and includes all accessorial and fuel surcharges.
It excludes specialty freight services, rail, air, ocean and courier shipments. Freight services paid in US currency have been translated into Canadian dollars based on the exchange rate applicable on the shipment date.
the Canada Border Services Agency (CBSA) Assessment and Revenue Management (CARM) system, a majot transformative project which will streamline the collection of duties and taxes related to international commerce, will be implemented by the agency on May 13, 2024.Recently, the Canadian Society of Customs Brokers (CSCB) and the Association of International Customs and Border Agencies (AICBA), reached out to the CTA about the potential for border slowdowns once CARM is introduced, and the need to work together to reduce the potential for freight delays by increasing awareness of CARM requirements within the importer community in advance of the implementation date.Although efforts to increase awareness and registration in the CARM portal have been ongoing for many months, with some success, it is estimated that only 55,000-60,000 of the roughly 200,000 importers conducting business in Canada are currently registered on the portal.To ensure that as many importers as possible are registered prior to CARM implementation, the Alliance and all trade chain partners are requesting that cross-border carriers consider:
Reaching out to their customers to make sure they are aware of CARM requirements and are registered on the portal.
If they are not registered, request they work with their customs brokers to ensure CARM compliance.
Ensure they have an active Business Number on file to help avoid their freight being potentially delayed once CARM goes live.
CBSA has continued to emphasize that border fluidity and the movement of trucks will remain a priority when CARM is introduced. CBSA has provided CTA with additional technical information related to CARM implementation, including measures to facilitate release at the border and help reduce or eliminate possible border slowdowns on May 13 and beyond. Further details from the agency can be viewed here: CARM Guidance-EN_publicAlthough there are no CARM related requirements for cross-border carriers currently, more information relating to the carrier registration process with the CARM portal will be available in the months to come.
Cargo volumes through the Port of Vancouver increased by 6% in 2023, as terminal operators moved a record 150.4 million metric tones of trade last year. It was a mixed year at the Port of Vancouver, with growth in some sectors and softening in others, shows the recently-released Vancouver Fraser Port Authority’s 2023 cargo statistics. While bulk and containerized exports grew, container imports softened in line with trends seen across the West Coast. Container volumes Container volumes were down 12% year over year, to 3.1 million twenty-foot equivalent units (TEU). Meanwhile, inbound containers were down 13%, reaching 1.6 million TEU. Containerized exports continued to recover from pandemic-era disruptions and were up 7% in 2023, as Canadian businesses used the increased availability of empty containers to deliver goods to markets across the globe. Empty container volumes were down 24%. “While there was a softening of container volumes moving through the Port of Vancouver in 2023, Canada’s container sector remains on a long-term growth trajectory and we saw encouraging signs of recovery in Q4 as year over year volumes started to grow,” said Peter Xotta, president and CEO of the Vancouver Fraser Port Authority, in a news release.
Chohan Freight Forwarders has earned the dubious distinction of being one of the most disliked and widely ridiculed trucking companies in all of Canada. This is an achievement not to be downplayed. I’m referring to the Surrey, B.C.-based trucking fleet that had its National Safety Code certificate stripped in the province of B.C. after striking six overpasses in the province over the past two years. Bridge strikes have become an epidemic in B.C., where 31 such collisions have occurred over the past two years, but no fleet has done so with such frequency as Chohan. Most of those who haul oversized loads are among the most skilled and safety-conscious drivers on the highway. They’re as puzzled and embarrassed as anyone as to how Chohan struck six bridges in 24 months and how it’s able to continue operating with impunity in the province despite a suspension intended to park its trucks.
FLATBEDS
lAfter dropping for the last five weeks, Flatbed load post volumes reversed course following last week’s 5% w/w increase. Volumes are 5% lower than last year and 6% higher than in 2019. Flatbed equipment posts dropped last week as available capacity tightened, increasing the load-to-truck ratio by 15% w/w to 18.12.
VAN LOADS
After dropping for the last five weeks, Flatbed load post volumes reversed course following last week’s 5% w/w increase. Volumes are 5% lower than last year and 6% higher than in 2019. Flatbed equipment posts dropped last week as available capacity tightened, increasing the load-to-truck ratio by 15% w/w to 18.12.
SPOT RATES
Flatbed linehaul rates increased slightly through last week's end-of-month shipping period, averaging $2.03/mile. The national average is $0.11/mile lower on a 20% higher volume of loads moved than last year.
C.H. Robinson (Nasdaq: CHRW), the largest trucking freight brokerage, is in a challenging spot that isn’t strictly due to the Great Freight Recession. Its stock is trading near the lows of the COVID lockdown (closing price on April 26 was $70.22; the COVID low was $63.91), with investors asking tough questions about the company’s long-term prospects. For three and a half decades, C.H. Robinson’s position was uncontested. It was in an enviable position — it had information and access to fleets that no one else did. After all, with the largest number of offices around the country and the largest network of carriers, almost no one could compete with Robinson’s pulse on the market or connection to fleets. Early on, this information and trading arbitrage became C.H. Robinson’s unfair advantage. However, other freight brokers emerged, and the share of freight that brokers handled grew faster than C.H. Robinson’s business.
Bob Biesterfeld, the former CEO of C.H. Robinson, declared in 2019 that the company would protect its market share by investing $1 billion in new technology. But it was too late. Robinson had been losing market share, but this was hard to see because of the growth of the underlying market. As long as the freight brokerage market grew, few would realize that C.H. Robinson’s business was under real stress. Then, the freight market exploded during COVID. Robinson made a fortune during the peak COVID cycle, handily beating analyst estimates like everyone in the space. However, that peak cycle turned, followed by the Great Freight Recession — one of the biggest and most painful downturns in freight market history. Although Robinson replaced its CEO, the new CEO can do little to fend off the inevitable decline of its core business.In recent months, FreightWaves has received reports of many veteran brokers leaving the firm, something that was unfathomable just a few years ago. Sources told FreightWaves that the departures were caused by compensation restructuring initiatives and a change in the company’s operating culture.
Source: Freightwaves
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China’s container exports to Mexico surged nearly 60% year over year (y/y) in January, according to global freight rate intelligence platform Xeneta. China-based shippers moved 117,000 twenty-foot equivalent units during the month compared to 73,000 TEUs in January 2023.
Despite the full implementation of Electronic Logging Devices (ELDs)
since December 2019, P. Sean Garney reports that hours-of-service (HOS)
violations continue to increase. Speaking at the Scopelitis Transportation Law
Seminar, Garney highlighted that although ELDs were expected to reduce these
violations through precise tracking, there has been a significant rise in false
log reports. He pointed out that the ambiguous definitions of "personal
conveyance" and the "yard rule" often lead to these violations.
Last year, regulators issued $1.7 million in penalties for these infractions,
with no single company facing excessively high fines. Garney suggests that
clarifying these rules could help reduce the instances of false reporting.
Source: Freightwaves
The Federal Motor Carrier
Safety Administration (FMCSA) has given the nod to the Transportation
Intermediaries Association's (TIA) 2023 petition, aiming to reassess the Moving
Ahead for Progress in the 21st Century (MAP-21) stipulation. This requirement mandates
newcomers to the broker and freight forwarding sector to possess a minimum of
three years of industry experience or to otherwise prove their adequate
knowledge. This acceptance by the FMCSA marks a significant achievement for TIA
amidst the ongoing battle against widespread fraud in the industry. TIA has
been at the forefront, critiquing the FMCSA for not effectively implementing
crucial legislative measures that could significantly mitigate fraud.
Gerry Reed, the owner of a small South Texas trucking company, said he’s fighting to survive against other carriers who continue to misuse Mexico-based B-1 visa drivers to deliver loads point to point within the U.S.Reed, whose name has been changed for this story, spoke to FreightWaves on condition of anonymity out of fear of retribution.As FreightWaves reported in March and April 2021 in several news stories, trucking and transportation operators in the U.S. and Mexico have been violating cabotage rules by misusing foreign B-1 visa drivers to deliver loads within the U.S.Cabotage rules prevent foreign nationals in the U.S. on B-1 business-visitor visas from competing with U.S. truckers on loads moving point to point in the U.S. The regulations are meant to protect driver jobs in the U.S. trucking industry. Reed and other trucking industry stakeholders told FreightWaves that the misuse of Mexico-based B-1 visa drivers creates unjust but significant savings to U.S. carriers that set up outsourced B-1 driver fleets at a lower cost. The trucking company owner said the misuse of B-1 visa drivers has gotten worse since FreightWaves first wrote about it three years ago. Even more trucking companies in the U.S. are employing Mexican B-1 visa drivers to undercut trucking rates in the country, while paying Mexico-based drivers less than U.S. truck drivers, he added.“ It’s definitely evolved over the last several years; now I’m seeing more U.S. companies open a division in Mexico, then get drivers with B-1 visas and use them as drivers in the U.S.,” Reed said. “I think that is the next evolution in this. Now you see U.S. companies that have figured out how to get a paper company set up in Mexico.” A Mexico-based driver with a B-1 visa can pick up a load in a Mexican city such as Nuevo Laredo, which sits across the border from Laredo, Texas. The B-1 driver then takes that load across the border to Laredo. That’s legal. The driver can either deadhead back to Mexico or take another load headed directly back to Nuevo Laredo. Instead of returning to Mexico, however, B-1 drivers are then often hired by companies to pick up new loads and go farther into the U.S., often taking work for less pay, which is illegal.
Source: Freightwaves, May 02, 2024
US ports concluded the
first quarter of 2024 with substantial year-over-year increases in container
volumes, driven by robust consumer demand. The Port of Los Angeles and the Port
of Long Beach, key nodes in transpacific trade, reported respective increases
of 19.3% and 8.3% in March. Ports across the country, including those in
Oakland, Seattle, Tacoma, Houston, Savannah, and South Carolina, all noted
similar trends of growth due to strong economic conditions and increased
consumer spending on durable goods.
Source: Transport Topics
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