Trends and News for SMBs | May

Trends and News for SMBs | May
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Keep your business up to speed with the latest news.

Vietnamese furniture fills a gap in Canadian market

Wooden furniture imports from Vietnam or to Canada have surged as Canadian buyers look for lower prices and original designs, Vietnam’s national radio broadcaster Voice of Vietnam reported.

Timber and wooden furniture exports to Canada rose nearly 50% in January and March.

According to the Voice of Vietnam, wooden furniture imports to Canada grew by an average of 3.1% annually between 2019 and 2023. Last year, however, inflation had a dampening effect on the market – causing imports to drop by 14.8% to USD 2.3 billion.

At the same time, Canada has been increasing furniture imports from China and Vietnam, but it has also reduced them from the US and EU.  Rob Robertson, the owner of a furniture store in British Columbia, recently told CBC News that about 40% of his business relied on imports from countries such as China, Vietnam, and Finland.

He noted that imports tended to be less costly than local products and offered unique looks not found in Canada. However, a group of local manufacturers, the Ontario-based Canadian Home Furnishing Alliance (CHFA), is seeking higher tariffs on fabric seating, such as sofas and chairs. 

Canada has a free trade agreement with Vietnam, and Vietnamese officials are urging the country’s exporters to take advantage of the tax initiatives under the trade pact as much as possible. They say that Vietnamese exporters have failed to use certificates of origin, which would allow them to enjoy these preferential tariffs.

Meanwhile, Voice of America reported that the US is considering upgrading Vietnam’s trade status, a step that would further cement already friendly ties between Hanoi and Washington.  Currently, Vietnam is on the US’s list of non-market economies, mostly made up of Russia, China, and former Soviet Union countries such as Belarus. 

The list is intended to penalize economies the US does not consider a free market with extra tariffs. 

Hanoi is pushing the US Department of Commerce hard to remove Vietnam from the list. It wants Washington to announce its decision in November 2024 before the US elections. 

 

Carriers pressure Panama as canal eyes end of Restrictions

The Panama Canal’s operator believes the end is in sight for the canal’s transit restrictions and is optimistic that by 2025, operations will be back to normal, Freight Waves reported.

In an encouraging sign for global supply chains, the Panama Canal Authority (ACP) said in the last week of April that it would allow 31 ships to transit the canal daily from the second half of May. 

Restrictions have already been lifted to allow 24 ships to transit the canal during the first half of May. By the start of June, 32 ships will be allowed to transit the canal. The ACP also plans to lift draft restrictions to allow more large slip ships to transit. 

Better-than-expected rainfalls have increased water levels at Gatun Lake, the main feeder reservoir for the canal. The lake remains three feet under its historical average water level for April as Panama enters its May rainy season.

Meteorologists blame last year’s drought on an El Niño weather event that led to the low average rainfall. 

While the restrictions have had a far more significant effect on bulk carriers and tankers than container ships, the restrictions – and threats of even stricter ones – had begun to prey on carriers’ and shippers’ minds. 

The ACP had discussed possibly imposing even more severe restrictions in February 2024 in the continued absence of rain in Panama, one of the world’s rainiest countries.

 

 

Sustainable yarns dominate in Shanghai event

Sustainable yarns have recently dominated Yarn Expo Spring, one of Shanghai’s textile industry’s leading trade fairs, Knitting Industry reported. 

Yarn Expo Spring attracted nearly 22,000 buyers and more than 515 exhibitors, with overseas buyers rising almost 90% on last year’s figures.  Bangladesh, Germany, and Indonesia were among the new countries exhibiting. The rising importance of sustainability to the textile and apparel industries dominated the event.

Eco-friendly cotton yarns and recycled and regenerated fibers were among the products taking center stage.

Wilmet Shea, general manager of Messe Frankfurt HK, said: “Much of the global textile industry has been working to make manufacturing processes more sustainable, developing transparency measures within their supply chains to achieve this goal. 

“With a rise in international exhibitors and increased domestic options, buyers found inspiration in the many eco-friendly innovations showcased across the fairground.”

Industry insiders report that sustainable yarn is the most in-demand raw material for the textile and fabric industry.

Rising global demand for fabrics has spotlighted the pollution associated with yarns and textiles – especially dyes and chemicals corrupting and polluting watercourses. This has led to a surge of interest in eco-friendly and sustainable yarns.

 

US ports register dramatic rise in inbound cargo volumes

Inbound cargo volumes at the US’s leading container ports are expected to reach their highest level since last fall, CNBC reported. 

The Port of Virginia, Norfolk, is seeing near-pandemic levels of container traffic, having absorbed much of the rerouted freight from Baltimore following the collapse of the Francis Scott Key Bridge.

Industry insiders are also predicting increased congestion and rising dray trucking rates at New York, New Jersey, and Norfolk as these become the temporary North American entry points for Baltimore freight.

Some analysts believe the West Coast will likely be the major beneficiary as it picks up increased volumes from East Coast ports.

The rise in container inflows is especially pronounced from China to the US following the reopening of manufacturing plants after the Lunar New Year holiday in China. 

The National Retail Federation’s global port tracker report estimates that inbound cargo volume to the US’s major container ports will top 2 million units by May. 

This will be the first time since last fall that it has reached this figure.

A good portion of the traffic appears to be driven by e-commerce shipments from China to the US by companies like Shein, Temu, and Alibaba. These retailers have been registering rapid growth in sales to the US as they benefit from generous de minimis tariffs on shipments worth less than $800

Drayage prices in Norfolk have already begun to move upwards, according to indexes. 

The major West Coast ports of Los Angeles and Long Beach stand to continue to benefit from fears of a strike at East Coast and Gulf Coast ports, with new dock worker contracts due to be renegotiated on September 30. January and February also saw rapid growth in container shipments. These figures are flattered, however, by a comparison with 2023 data. This time last year, many shippers were reducing their inventories.

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