Supply Chain Industry Insights – December 2024

Industry Insights

December 2024

By PGL

Welcome to the PGL Industry Insights report for December 2024

Season’s greetings from all of us here at PGL. We hope you have a wonderful holiday and a prosperous 2025 ahead of you!

We start this month’s report with news that the uptick in rail freight continues with intermodal volume up almost 10% this year over 2023. This was buoyed somewhat by an uncharacteristically large slump the week of Thanksgiving, but volume is still up for the year, and there are indications that it will continue to perform well in the new year.

In ocean freight, Labor tensions and political uncertainty with regard to future tariffs kept late November container rates to the US high, with Asia-to-US rates well over $5,000 per FEU and heading up. Forecasters are identifying both the West and Gulf Coast ILA labor fight as well as trepidation surrounding the unknown timing and overall impact of proposed tariff increases as factors for shippers to try to beat these issues to the punch, increasing volume and therefore, cost, ahead of what should prove to be an impactful January.

Speaking of the current ILA labor issues, President-elect, Donald Trump has commented repeatedly in recent days that he backs the Union’s stance to block port automation. It is unknown how this may affect the big picture, or how a long-term work stoppage would be received by the administration. PGL will keep an eye on how this develops ahead of the January 15 negotiation deadline.

Twice this month, US warships successfully defended three US-flagged merchant ships in the Gulf of Arden. The Destroyers were able to intercept several different ballistic and cruise missiles that were launched by the Houthi rebels that have been hunting vessels in the Red Sea for over a year.

After a tiny bump at the beginning of the month, benchmark diesel price dropped again, going below its lowest point in over three years that was hit in November. Early this month, OPEC+ held a meeting that led to an extension of the production cuts that were due to be adjusted for higher volume in December. The futures market remains bearish, with no signs of increasing prices on the horizon.

That’s it for this month’s report. Subscribe to our channel to make sure you get the latest supply chain insights. As always, PGL will be here to keep you informed 24/7/365.

Follow us at @shipPGL and visit our website at www.shipPGL.com.