Ten weeks after the Francis Scott Key Bridge Collapse the Dali cargo ship was freed from the wreckage and floated back to port. The bridge collapse not only shut down an important roadway for transporting goods from the east coast to the midwest, it shut down the waterway used by container ships to bring goods in. With the removal of the cargo ship comes the promise of increased shipping traffic and, Baltimoreans hope, a return to normal supply chain logistics that will reboot the local economy.
Vessel and Highway Traffic
Vessel traffic had been suspended until the channel had been cleared of debris. Though there is still a lot to be removed, with the Dali gone Maryland Gov. Wes Moore says some cargo ships will be cleared to enter the channel. However, locals wonder if port traffic will ever return to what it was. Even after the remaining metal has been pulled from the water, there is still a bridge that needs to be rebuilt which would include further shutdown of traffic into the port. Baltimore has been the go to port for offloading farm equipment headed for the Midwest. Even if some traffic resumes, the bridge collapse caused a significant rift in this specific supply chain route. Freight charges will remain higher as long as these imports are forced to take alternate, and typically longer, routes to get to their destinations.
Another piece of good news is concern over highway traffic congestion around ports now accommodating Baltimore’s shipments seem to have been over inflated. The latest freight reports show that there is no additional congestion around ports that have taken on Baltimore’s cargo. The dust hasn’t quite settled yet, and it’s unclear if any single port has taken on the brunt of the influx of goods, or if shipments have been dispersed evenly. Highway traffic would be an indicator of a port taking on excess cargo.
Supply Chain Logistics
Initial fear over a long cleanup and repair process causing inflation for certain goods has so far proven to be overblown as well. Though rerouted vessels created backups in other ports, and shipping delays of farm equipment, fertilizer, and small vehicles at the start, for the most part, lessons learned during the height of the pandemic have served us well in this situation. Communication is happening quickly and ports have worked together to absorb the impact.
Baltimore’s port, unique due to the size of its channel, accommodated some of the largest cargo ships and was one of just a few able to take imports of vehicles, small trucks and farm equipment. Finding ports for these ships that keep them in range of their next destination in order to minimize transport appears to not be as challenging as anticipated; though many companies are continuing to evaluate data as they make decisions about where to offload cargo. The farther goods travel, the more consumers could pay as additional fuel costs must be absorbed along supply chains. However, farm equipment is currently in large supply as interest rates continue to stay high. In many cases, dealerships and warehouses are running out of room.
Baltimore’s Economy
The bridge collapse impacted Baltimore’s economy. Approximately $190 million a day has been lost as a result. Thousands of dockworkers including crane operators, mechanics, and office staff responsible for scheduling and recording cargo traffic have been laid off at least temporarily. Without shipments entering the port there is no work and no cashflow to keep people employed. Maryland recently allotted Rainy Day Relief funds to dockworkers, but money has not been doled out yet. The ripple effect of this is likely to be felt on a larger scale as the hundreds of families impacted modify their spending habits.
Sailing and fishing tours, as well as other small businesses that operate in the vicinity of the bridge have also been affected. While many of these smaller boats could still navigate the channel, there is a general consensus that less traffic will speed up the process of removing debris. Business is expected to pick back up now that the Dali is docked, but the biggest variable at the moment continues to be time. Crews hit the ground running yet, the task is enormous, with few details available as to what next steps will be once the bridge has been removed from the waterway.
Waterway Infrastructure Considerations
Protecting supply chain efficiency on our waterways is the ultimate goal. The victory today is how well our existing supply chain infrastructure has supported this unforeseen disaster. Ports are collaborating to accommodate ships coming in as well as American businesses working to get shipments out. Michigan, Illinois, Iowa and Ohio, are dependent on Baltimore’s port for exporting vehicles. General Motors, Toyota, BMW and Volkswagen are all securing new loading and unloading points, but none are worried about significant impact to their businesses.
Conversations about securing our waterways and their surrounding infrastructure are moving to the forefront of supply chain discussions. Just days after the Francis Scott Key Bridge collapse, a barge on the Arkansas River collided with a bridge in Oklahoma. Inspectors declared the bridge safe to use within hours of the incident. But, recent events have engineers looking for ways to shore up existing bridges all across America. And, they are also taking into consideration the eroding river banks that anchor many of these bridges, particularly those on the Mississippi River.
Abroad, transport has been disrupted as well. The Panama Canal is experiencing low water levels which is impacting shipping routes, and vessels are avoiding Red Sea routes not wanting to become targets. Individually these would be minimally impactful scenarios. Together they represent significant disruption to the flow of goods. We rely heavily on waterways to ferry products from one place to another. Baltimore has a long road ahead but things are working well thus far, and it will be interesting to see what practices are worth duplicating across other supply chain routes dependent on waterways.
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