Over the past couple months, the strike threat on freight railroads has been a huge concern in the supply chain industry. Railroad workers focused on their disagreement about not only their pay but also their working conditions. They risked their jobs when taking time off for personal needs such as a doctor’s appointment or caring for their family. President Biden, on September 15, announced a tentative agreement between the railroad unions. This tentative agreement came at a crucial time as a strike from the rail workers could have had devastating economic impact. The Association of American Railroads predicted that the number of long-haul trucks needed could rise to 467,000 if an agreement was not met. In the meantime, while they find a long-term solution for the railroad unions, this situation should be monitored closely as this strike could cost America two billion dollars a day.
Closing out quarter three, the economy is resembling similar trends to the previous one. There have been projections that changes in upcoming months are on the horizon. The inflation rate is closing out this quarter at 8.3%. Still very high, but the Organization for Economic Cooperation and Development is predicting that it could fall as low as 4.4% by the new year. Oil and natural gas prices seem to have stabilized over the past three months. Between July and September, Natural gas peaked at $5.75 / gallon but is now sitting at $3.71 / gallon. Projections have been made that it may rise to around the $4 / gallon mark soon due to increased demand during the retail season. Overall, It seems as if the economy has made a full recovery from the COVID-19 pandemic as port congestion and labor force shortages are back to their pre-pandemic levels.
Transitioning to natural disasters, Hurricane Ian recently hit the gulf coast side of Florida. The state has taken proactive steps to combating the negative effects on supply chain by lifting trucking restrictions such as hours-of-service, size and weight in order for drivers to deliver emergency supplies and equipment. These restrictions will be lifted for 60 days and will affect 40 different gulf coast counties. Even with the proactive approach by the Florida government, experts are still expecting disruption in supply chain due to flooding, power outages, and wind damage that could stall production as well as freight movement by port, rail, and over the road.
As the economy goes through changes and the retail season approaches, do not hesitate to reach out to Axle Logistics for more information about market conditions and our 24/7/365 services.