WEEK 4 TOP 5: DISRUPTION TO SUPPLY CHAIN WATCHLIST No.222
- (Following No.221)?An Israeli delegation arrived in Cairo on January 22 to continue negotiations on implementing the second phase of the recently reached Gaza ceasefire-for-hostage release deal, according to a Xinhua news report.?
The Houthi Humanitarian Operations Coordination Center (HOCC) announced on January 20 that it would cease targeting international shipping in the Suez Canal and the Red Sea, following the ceasefire's initiation between Palestinians and Israelis. On January 22, the Houthis released the crew of the Galaxy Leader, a vehicle carrier seized in November 2023.?
On the same day, the White House officially designated the Houthis as a Foreign Terrorist Organization, expanding the implications from financial sanctions to include criminal penalties—a significant shift from the previous designation as a Specially Designated Global Terrorist (SDGT) made on January 17, 2024.?
Iraqi President?Rashid announced on January 24 that Iranian-backed Iraqi militias have halted military activities following pressure from the Iraqi federal government.?
Regarding Syria, the EU is considering lifting some sanctions, particularly on financial transactions, air transport, and the energy sector. Discussions are ongoing, with a decision expected before the EU foreign ministers' meeting on January 27, 2025.?
The Islamic Revolutionary Guards Corps (IRGC) Navy continued the "Great Prophet 19" military exercise near Bushehr and Khuzestan on January 24. This exercise, according to IRGC Navy Commander Rear Admiral Alireza Tangsiri, promotes regional peace and security, albeit with a cautionary note to transregional forces. Concurrently, the UK Maritime Trade Operations (UKMTO) reported challenges to vessels via Very High Frequency (VHF) radio in the northern Persian Gulf, indicating potential disruptions near the Strait of Hormuz.?
In logistics, the Shanghai Containerized Freight Index fell by 4% this week, marking its third consecutive decline, while Drewry’s World Container Index decreased by 11% to $3,445 per 40ft container. Drewry anticipates a slight decrease in spot rates following the Chinese Lunar New Year holidays.?
Disruption: The de-escalation of the Israel-Hamas conflict continues as expected. Anticipation grows for potential EU sanctions lifting on Syria, with rerouting around the Cape likely to persist through at least the first half of 2025.?
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- (Following No. 217) Heavy rainfall as forecasted has triggered flooding and landslides across the Java Islands, Indonesia. Key infrastructure such as bridges, roads, and residences in the districts of Pekalongan, Grobogan, Kendal, Batang, and Demak in Central Java province have sustained significant damage due to the intense rain. The Indonesian Meteorology Agency (BMKG) forecasts additional rainfall, which may increase the risk of further flooding and landslides.?
In response, the National Disaster Mitigation Agency (BNPB) dispersed two tons of salt into potential cloud formations above Lampung and Central Java on January 24, aiming to control the rainfall intensity in these areas. This intervention follows a week of heavy rainfall in these provinces, which has already triggered hydrometeorological disasters including floods and landslides from January 20-22.?
Disruption: ongoing disruptions to road transportation across the Java islands due to flooding.?
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- The US National Weather Service issued significant winter storm warnings across the southern United States, starting January 21. This severe weather has caused disruptions at key transportation hubs including Gulf of Mexico ports and airports, as well as major inland transportation routes. ?
The Port of Mobile suspended operations from January 21 to January 23. The Port of New Orleans has been closed since January 19, including the January 20 Martin Luther King Day holiday, and remained closed until January 23. Both Port Americas and New Orleans Terminal at the Port of New Orleans will resume gate operations on January 25; the Port of Houston, which closed on January 21, also will reopen its gates on January 25.??
Significant flight cancellations and delays affected regional airports on January 22, including George Bush Intercontinental Airport (IAH), Hartsfield-Jackson International Airport (ATL), and Jacksonville International Airport(JAX).?
Disruption: cargo delay and potential congestions at the Port of New Orleans and Port of Houston next week ?
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- On January 20, a new collective labor agreement was reached between port worker unions and Hutchison Ports Delta II and ECT Rotterdam, following the expiration of the previous contract on December 31, 2024. After months of negotiations, this agreement successfully averts potential industrial actions. Earlier in January, the unions organized a one-hour 'gathering' to exert pressure for favorable terms.?
Disruption: No industrial actions?anticipated in relation to this collective labor agreement?
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- Docker and port worker unions at France’s largest container port, Le Havre, have initiated a program of intermittent industrial action scheduled over the next month in response to proposed state pension reforms.?
Workers at the Normandy gateway will conduct four-hour walkouts on January 27, 29, 30, 31, and February 4, 6, 10, 12, 14, 18, 20, 24, 26, and 28. Additionally, several 48-hour strikes are planned.?
Furthermore, the CGT port staff union has announced upcoming strike actions at the Port of Saint-Nazaire/Montoir:?
Additionally, France's largest labor unions, including CFTC, CGT, FO, FSU, STC, and Sud, have called for widespread strikes on February 4, potentially impacting sectors such as transportation, manufacturing, banking, public health, and education.?
Disruption: intermittent industrial actions to cause cargo delays and potential congestion at ports, disruptions to airport operations.?