The LCL market is heating up. Director of global LCL, Greg Scott, lays out current conditions, future happenstances, and what you can do. CURRENT CONDITIONS: • Cargo is shifting to less-than-container load (LCL). Shippers are converting full-container-load (FCL) shipments to LCL due to the roll pools. Depending on what port you’re shipping from, it’s very likely your freight will move sooner with LCL than FCL in today’s ocean market. Air freight is also being converted due to capacity challenges combined with the approaching air freight peak season. • Omissions and blank sailings are impacting direct service offerings into the smaller markets, such as St. Louis and Minneapolis. We’re pivoting to alternative services or routings when this happens. POTENTIAL FUTURE HAPPENSTANCES: • Elevated rates in LCL with premium pricing or surcharges. As seen in other modes and during the pandemic, if demand, space, and equipment remain tight it’s likely rates could be adjusted beyond announced carrier levels. • Shifting of modes could create LCL roll pools. LCL is not immune to disruption and space could eventually run out if demand and cargo shifting continue at this rate. • Expedited LCL services could see increased demand. As more and more cargo change transportation modes, expedited LCL services could see higher demand and limits to shipment volume and weight. WHAT TO DO: If you’re contemplating a modal shift, consider it now. LCL helped a lot of importers when it came to moving shipments during a congested export environment early on and throughout the pandemic. LCL is a smart way to keep your freight moving in segments versus waiting to load as FCL. It’s also more cost-effective than traditional air freight, especially with tight capacity in the market and the potential of elevating rates. If you need to explore if a modal shift is the right move for you, talk to your logistics partner.
Well stated, Greg Scott.
Former Director, Senior Special Agent, Supervisory Special Agent
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