ALERTS & ​ADVISORIES

Strike Alert: Day 2 of East and Gulf Coast Port Shutdown & Escalating Global Disruptions

By
October 2, 2024
Strike Disrupting East and Gulf Coast Ports—Immediate Business Impact
Strike Disrupting East and Gulf Coast Ports—Immediate Business Impact

The strike has entered its second day, and the global impact is growing more pronounced. Yesterday's announcement from the White House confirmed the U.S. administration's support for the International Longshoremen's Association (ILA) in their labor dispute. With no significant concessions from the U.S. Maritime Alliance (USMX) on the horizon, it appears increasingly likely that this conflict will extend beyond just a few days, potentially lasting for an extended period. The prolonged uncertainty in port operations is compounding supply chain disruptions across industries worldwide.

Key Updates from Major Carriers:

  1. CMA CGM Declares Force Majeure: CMA CGM has invoked force majeure due to the strike, citing Term 10 of their Bill of Lading. As a result, operational costs from vessel delays at East and Gulf Coast ports will be charged to cargo on the water as of October 1st, 2024. A Local Port Charge (LPC) will apply to all incoming cargo from October 11th, but this will not include additional operational costs under Term 10(a).
  2. ONE's Force Majeure & Route Adjustments: ONE has also declared force majeure, invoking rights under Clauses 17 and 18 of their Bill of Lading Terms. In addition, the carrier has adjusted routes, with the “NYK Demeter” on the AL5 Eur-America service now skipping Port Everglades and discharging USEC cargo in Halifax instead.
  3. Montreal Terminal Strikes: Strikes at the Maisonneuve and Viau terminals in Montreal continue, with operations expected to resume by October 3rd. Other terminals are functioning, but the disruption is already causing ripple effects across the supply chain.

   

What to Expect:

The effects of the strike are beginning to take hold, with growing congestion in Central American hubs and a significant drop in export capacity from Europe and South America. Delays in U.S. vessel arrivals will lead to further congestion across global trade routes, creating additional bottlenecks for shippers worldwide.

  1. Export Bottlenecks: As vessels fail to arrive from the U.S., export capacity from Europe and South America will diminish. This will trigger a ripple effect across regions, delaying shipments and complicating global trade flows.
  2. Carrier Rate Increases: Along with the operational delays, businesses should expect rising logistics costs. All carriers have already implemented surcharges, and other rate hikes are expected as the strike continues.
  3. Air Freight Demand and Rising Rates: With ocean freight options severely constrained, demand for air freight is surging. This increased demand is driving up air freight rates significantly, making it a more costly but crucial option for time-sensitive shipments. Businesses relying on urgent deliveries should prepare for elevated costs in this sector as capacity tightens.

   

Mitigation Strategies:

  1. Explore Air Freight Options: Given the strain on ocean freight, air freight is emerging as the fastest alternative for critical shipments. However, businesses should anticipate higher costs due to skyrocketing demand.
  2. Plan for Extended Delays: Even after the strike concludes, a backlog of cargo will take weeks to clear. Businesses must adjust timelines and inventory planning to accommodate extended transit times.
  3. Review Carrier Contracts: With force majeure clauses now in play, it is essential to review shipping contracts to understand responsibilities regarding surcharges and rate increases. Clarifying these terms now will help avoid unexpected costs.

   

JAS Worldwide Is Here to Help:

JAS Worldwide is committed to supporting you through these challenging times. Our team is actively monitoring the situation and is ready to offer tailored solutions, including air freight options and alternative routing strategies, to ensure your supply chain remains operational. Contact your JAS representative today to discuss how we can help minimize the impact of these disruptions and develop a logistics plan suited to your business needs.

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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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