ALERTS & ​ADVISORIES

Negotiations Stall Between ILA and USMX: Urgent Impact on Your Business

By
September 30, 2024
Negotiations Stall Between ILA and USMX: Urgent Impact on Your Business
Negotiations Stall Between ILA and USMX: Urgent Impact on Your Business

With key issues such as wages and automation unresolved, talks between the International Longshoremen’s Association (ILA) and the United States Maritime Alliance (USMX) have broken down. If no agreement is reached by September 30, 2024, the ILA plans to initiate a strike on October 1, 2024, which will have significant consequences for businesses relying on U.S. East and Gulf Coast ports.

What This Means for Your Business:

The ILA represents workers at major U.S. container ports, and a strike could result in:

  • A halt to container operations at over half of U.S. ports.
  • Major delays at East and Gulf Coast entry points.
  • Prolonged transit times and rerouted vessels, leading to increased shipping costs.
  • Cargo stranded at ports, triggering costly storage and detention fees.
  • A ripple effect across industries during the peak season, from importers to retailers.
  • Heightened global shipping congestion and elevated freight rates.

Key Updates:

  • Vessel Rerouting: Hapag-Lloyd and ONE have already adjusted operations, rerouting 11 vessels to alternative ports. For example, "Alessia" (AN2 service) will offload Houston and New Orleans-bound cargo in Cartagena, Colombia, while "Tempanos" (ANG service) will discharge similar cargo in Altamira, Mexico, on October 1. ONE plans to return the cargo to the U.S. once the strike ends.
  • Updated Surcharges: ONE has announced updated strike-related surcharges: CGD (except China) at $2,000/40' and CON (China) at $1,000/40', reflecting different regulatory requirements. MSC has also introduced a $3,000/40' Emergency Operation Surcharge (EOS) from China, Japan, Korea, and Southeast Asia, effective October 27.
  • Reefer Cargo: MSC will continue accepting dry container bookings into USEC and USGC but reserves the right to reject reefer bookings and will not assume liability for those left in strike-affected terminals.

Recommendations for Shippers:

  • Prepare for West Coast Congestion: As many shippers reroute to West Coast ports, anticipate longer wait times, increased fees, and congestion.
  • Expect Delays: In-transit cargo bound for East and Gulf Coast ports will face docking delays, with backlogs persisting even after a strike ends.
  • Consider Air Freight: For time-sensitive shipments, air freight remains the fastest alternative. JAS offers multiple air cargo solutions.
  • Plan for Higher Costs: Shipping rates will rise due to increased demand, while delays will lead to higher demurrage, detention, and storage fees.
  • Review Incoterms: Ensure clarity on financial responsibilities for delays and fees as determined by Incoterms. Be prepared to manage rerouting and storage costs.

To mitigate potential disruption, JAS has contingency plans ready. We recommend exploring alternative logistics solutions, such as air freight for high-priority shipments and can assist with rerouting options. Contact your JAS representative to discuss tailored strategies for keeping your cargo moving smoothly amid these challenges.

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JAS completes the Acquisition of IAA

ATLANTA, February 20, 2025 – JAS, a global leader in logistics and supply chain solutions, has successfully completed its acquisition International Airfreight Associates B.V. ("IAA"), a specialized provider of Air, Ocean and Road Freight services headquartered in the Netherlands. This milestone follows the signing of the Share Purchase Agreement (SPA) announced in December 2024 and marks the official integration of IAA into the JAS network.

"The acquisition of IAA strengthens the JAS global logistics portfolio and access to key markets, particularly in the time-critical perishable goods sector," said Marco Rebuffi, CEO and President of JAS. "We are proud to welcome IAA's talented highly experienced team to JAS and are looking forward to delivering excellent service to our customers together."

Jur de Graaf, Managing Director of International Airfreight Associates, added, "Joining JAS allows us to expand our services globally and continue delivering high-quality logistics solutions for our customers. We are confident that our partnership will create new opportunities for our employees, partners and clients.”

IAA is one of the top 3 IATA forwarders at Amsterdam Schiphol Airport with Warehouses and Operations in the Netherlands, Belgium and Germany. IAA specializes in managing time-sensitive perishable fresh goods and livestock shipments as well as multimodal general cargo.

The acquisition strengthens JAS global service portfolio by enhancing the footprint in the European logistics market and beyond. Together, JAS and IAA teams will drive customer value through expanded service offerings, operational excellence, and an even broader global network.

About JAS

JAS, a global leader in logistics and supply chain solutions, was founded in Milan, Italy, in 1978. Headquartered in Atlanta, Georgia, and supported by 7,000+ team members in more than 100 countries, JAS focuses on creating solutions that are innovative, sustainable, and tailored to customer needs. As a privately owned company, JAS is committed to creating opportunities for communities, customers, and colleagues to thrive.

About International Airfreight Associates B.V.

International Airfreight Associates B.V. ("IAA") is a specialized provider of Air, Ocean and Road Freight services headquartered in the Netherlands. With nearly 100 employees and strategic locations and operations including Amsterdam, Aalsmeer, Rotterdam, and Frankfurt, the company specializes in moving fresh perishable goods, livestock and multimodal supply chain solutions for a diverse range of clients.

JAS Poland proudly took home three awards at the Lufthansa Cargo Partner Event in Warsaw, recognizing our outstanding performance in 2024.

On January 24, 2025, industry leaders gathered at the Renaissance Warsaw Airport Hotel to celebrate a year of collaboration with Lufthansa Cargo.

The evening brought together key partners to reflect on past achievements, discuss future opportunities, and recognize outstanding performance across the logistics sector.

JAS Poland had a standout night, earning three awards for exceptional performance in 2024:

  • 1st Place – Jumper of the Year 2024
  • 2nd Place – Performer in Revenue
  • 3rd Place – Performer in WACD Market Share

The event featured an inspiring speech by Ashwin Bhat, CEO of Lufthansa Cargo AG, and a panel discussion on the evolving landscape of e-commerce. The awards gala was a testament to the strong partnerships and shared success within the industry.

A heartfelt thank you to Lufthansa Cargo for their continued trust and collaboration. Here’s to another year of reaching new heights!

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The European Union's Sustainable Aviation Fuel (SAF) mandate is set to reshape the aviation industry, requiring airlines to incorporate a minimum of 2% SAF in their fuel mix starting in 2025. This regulation represents a major step toward reducing carbon emissions, but it also brings substantial cost challenges for carriers operating across Europe.

Impact on Freight Costs and Sustainability Surcharges

The implementation of the SAF mandate is driving up operational costs for airlines, directly influencing freight rates. To offset these additional expenses, airlines are introducing mandatory sustainability surcharges on shipments departing from or transiting through European airports. While this presents immediate financial challenges, it also serves as a catalyst for innovation and investment in alternative fuels, paving the way for a more sustainable aviation sector.

Balancing Cost and Sustainability

As airlines adapt to these regulatory changes, they must navigate the delicate balance between cost management and environmental responsibility. The evolution of SAF production, along with advancements in supply chain logistics, will play a critical role in determining how efficiently the industry can meet these mandates. Collaboration between fuel suppliers, airlines, and logistics partners will be essential to ensuring a smooth transition.

Stay Informed with JAS

To help our customers understand the implications of this new regulation, we invite you to download HERE the JAS One-Pager on the ReFuelEU Aviation Regulation. This resource provides a clear and user-friendly overview of the changes and their impact on airfreight logistics. Additionally, you can visit the ReFuelEU Aviation Regulation website for further details (ReFuelEU Aviation Regulation website )

At JAS, we are committed to clear and transparent communication regarding regulatory changes affecting global supply chains. If you have any questions or concerns, please do not hesitate to contact your nearest JAS representative for more information and tailored support.

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