While Americans watch in horror as innocent Chinese citizens are caught up in an ill-conceived, reckless, or nefarious – take your pick – act by the Chinese Communist Party, there is little Americans can do about it. But like most geopolitical events these days, the lockdowns in Shanghai and other Chinese cities are also a supply chain story that will have a dramatic effect on domestic freight markets.
The recent slowdown in U.S. truckload markets is likely a precursor to a steeper decline in the coming weeks. The lockdowns in China were not a factor in slowing U.S. truckload volumes in February and March, as evidenced by record container imports at nearly all major U.S. ports.
But that shouldn’t give anyone comfort because the slowdown is about to hit U.S. ports – and the trucking companies that service them – in a dramatic way. FreightWaves estimates that container imports from China represent approximately 16% of U.S. truckload volumes and an even larger percentage of U.S. dry van truckloads. After all, nearly half of the containers that come into the United States originate in China. […]
The three largest cities in China are going to be removed from the world market. According to analysts, at least 40% of China’s GDP has been taken offline and this was before lockdowns began in Beijing. The vast majority of this GDP is directly related to global manufacturing. Removing it means removing the flow of containers from the world economy.
I’m sure the soyboys of Ottawa won’t rejoice at that. Less freight to be hauled means more time for truckers to come to that fair city and honk.
Oh, on the contrary, they’ll have plenty to celebrate. Fewer 18 wheelers spewing poisonous CO2 into the atmosphere! More unemployed peons dependent upon gov’t largesse!
BA, we are the authors of our own demise. Sadly those of us with any intellect are no longer listened to. The terminally stupid are in control. See Bonhoeffer’s comments on stupidity.
And why isn’t our politicians preparing for it?
No doubt many products are for basic infrastructure repairs or replacement.
We’re also heavily infrastructure for the internet which is our banking as well as entertainment.
Oh, I have cash in my account…
That isn’t the same as ‘Cash on Hand’.
I suspect it’ll be much worse when adding in the steep interest rate hikes.
Banks could fail depending on their financial investments since it is GLOBALIZATION.
And Russia ain’t in it no more and China is closed wanting to use their own currency as well.
With Shanghai in a near total lockdown, this is a map of the commercial ships currently waiting offshore to be loaded and offloaded of goods; exacerbating global supply chain woes
https://twitter.com/ScottGottliebMD/status/1516161345661591558
So, less plastic crap from China is a bad thing?
What will Bezos do?
Thanks for posting this article. Lots of food for thought here for small, retail investors like me.
A pullback on price wouldn’t be a bad thing. Cross border truckloads have more than doubled in price – only a portion of that is fuel.
“The recent slowdown in U.S. truckload markets is likely a precursor to a steeper decline in the coming weeks.”
yah a general strike will do that.
Faced with a government intent on violating every aspect of our consent to be governed,not working for them might make sense.
For these parasites cannot steal what they cannot see.
Here’s an idea! Bring manufacturing back to America! After all … the cheap labor is flowing across the southern border in droves.
1 drove = 100M illegals
jesus, Kenji, one cannot possibly make a sensible rational suggestion in todays dystopian freaking world. The average person lacks the brain power to figure that one out. Yes, today I am really down on the stupidity of my fellow man. They have become an embarrassment to the entire human species.
I used to believe the common man had common sense. That belief has given way to my atheism about mankind
They forgot to model in the baby boomer 70 million generation of us that have left the workforce. that’s why we now are short 90,000 truck drivers 10 thousand aircraft Pilots, Experienced air craft Pilots!, the baby Boom build back builders have given up on this Administration and who can blame them why work for a bunch of Communist tax suckle piss ants. And even consider going off to war for a mental home patient? Ha.
We Might Be Screwed.
Finally a way to clear up the backlog in the port of Long Beach.
I talked to guy who works for Peterbuilt. They can’t keep up with demand. Can’t supply the market.
The tucking market is on fire.
Trucking, too, I bet. 😉
Might be the frucking market
As I noted above shipping rates have gone through the roof – both domestically and cross border – only part of that is fuel. A big part of the spike in prices of consumables.
Well drivers need danger pay to drive in Ontario and California.
And the company needs insurance against bureaucratic caprice and higher returns for facing these risks..
You risk your whole company to deliver freight to Ontario..
So why bother?
Safer and more lucrative work elsewhere.