Insights by Auba (Oct 4th): DP World in Mexico & Port Strikes
Desteia (formerly Auba)
AI co-pilot to empower leaders with unparalleled visibility, efficiency, and control over their supply chain.
Welcome back to Insights by Auba!
Your go to newsletter for all things logistics, nearshoring, and supply chain (all with original research from data department to wherever you get your news!)
A Major Bet on Mexico
DP World, one of the largest logistics companies in the world, announced its intent to expand operations into Mexico.
Based in Dubai, DP World is renowned for its management of ports and terminal operations, and the news, first reported by the Wall Street Journal, highlights Mexico's growing role in international logistics and its potential as a strategic logistics hub.
DP World’s global presence spans across the Americas, including ports in Canada, South America, and the Caribbean. However, the company has long sought access to the U.S. market, facing political roadblocks since 2006. As of the time of writing this piece, the company owned 17 ports or terminals within the American continent—both North, Central, and South America, with some facilities in the Caribbean as well. Yet, as the map below shows, there is a clear gap in access when it comes to the US market.
Read more below:
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The Week in Short
?? U.S. ports reopened after a three-day strike ended with dockworkers accepting a revised offer that includes a 62% wage increase over six years. The strike had halted operations from Maine to Texas, threatening supply chains galore. President Biden applauded the resolution, highlighting the importance of collective bargaining (more on Wall Street Journal).
?? Air cargo demand grew by 9% in September, though slower than in previous months, while capacity rose by just 3%. Average freight rates increased by 26% year on year. The slowdown in demand reflects factors like last year's surge, flight adjustments for winter, and disruptions from U.S. port strikes and typhoons (more on Air Cargo News).
?? Hurricane Helene has caused significant delivery disruptions for FedEx, UPS, and the U.S. Postal Service in the Southeast, particularly in North Carolina. Over 200 people have died, and the storm has damaged infrastructure, leading to extended delays. FedEx reported limited to no service in over 600 ZIP codes, while UPS is facing delays in North Carolina (more on Supply Chain Dive).?
?? Hapag-Lloyd placed one of the largest containership orders in history, totaling $5.25 billion if all options are exercised. The German carrier contracted Yangzijiang Shipbuilding and New Times Shipbuilding for a combined 393,000 slots on LNG dual-fuel ships, including 17,000 TEU and 9,200 TEU vessels (more on Splash 247).??
?? China's Coast Guard, alongside Russia, entered the Arctic Sea for the first time, signaling a significant step in their joint efforts to establish a "Polar Silk Road." This maneuver, which took place in the Bering Sea, highlights both nations' growing ambitions to secure influence over the Arctic's strategic shipping routes and resources, as melting ice opens new opportunities (more on GCaptain).?
?? In July, Mexican authorities recorded 382 railway thefts, marking a 119% increase compared to July 2023. The states most affected were Guanajuato (83 cases), Coahuila (72), and Jalisco (43), with industrial products, grains, and auto parts being the primary targets (more on Freight Waves).
?? Container shipping schedule reliability improved slightly in August, reaching 52.8%, though still 10.2 percentage points lower than the same period in 2023, according to Sea-Intelligence Consulting. Maersk led carriers with 54.7% reliability, while Pacific International Lines had the lowest at 37.2% (more on Load Star).??
That is all for this week, but make sure to follow Auba to stay up to date on all things supply chain and logistics