Feds Suspend Rail Operations in Texas Amid Migrant Surge


U.S. Customs and Border Protection (CBP) has temporarily suspended all rail operations in Eagle Pass and El Paso, Texas after observing a surge in the smuggling of migrants across the Southern Border by train, throwing yet another kink into supply chains.

CBP said in a statement on Sunday that the two rail bridges – the second and third highest volume gateways moving freight between the U.S., Canada, and Mexico – will close as of 8 a.m. on December 18 in order to redeploy resources to assist Border Patrol agents with taking migrants into custody in what it described as an “evolving situation.”

CBP said it was closing the bridges because smuggling organizations were using the freight trains with increasing frequency to transport their human cargo.

The announcement follows the apprehension of nearly 4,500 illegal migrants in Del Rio and El Paso by border patrol agents on Sunday and comes on the heels of a slew of viral videos on social media depicting a flood of migrants riding freight trains bound for the U.S.

The suspension of international railway traffic is one of several changes CBP has made in efforts to “respond, process, and enforce consequences” of unauthorized crossings along the border with Mexico, the agency said.  In recent weeks, CBP has closed the port of entry in Lukeville, AZ, a pedestrian crossing in San Diego, CA, and a vehicle crossing in Eagle Pass, TX.  “We [will] continue to adjust our operational plans to maximize enforcement efforts against those noncitizens who do not use lawful pathways or processes such as CBP One™ and those without a legal basis to remain in the United States,” it added.

Cross-border Freight Begins Piling Up

Union Pacific, which manages the route, said the closure has prompted an embargo on all of its Mexican-bound cargo, including 60 trains already enroute as well as those that are currently being processed in more than 50 rail yards across the country.  That traffic alone amounts to over 4,500 rail cars being held north of the border, with “an equivalent amount of northbound traffic currently held south of the border.”

The closure of railway and border crossings will not only hinder trade, but also “make a bad situation worse, inflicting even more economic harm on the U.S.-Mexico relationship and driving up costs,” Border Trade Alliance President Britton Mullen said in a statement.  “These port closures are a byproduct of Congress and the administration’s failure to adopt a border security and immigration reform package that can balance our economic and physical security,” Britton added.  “The public and private stakeholders whose livelihoods depend on a well-managed, well-resourced, and secure border have waited long enough.”

Border States Called to Action

Meanwhile, Texas and Arizona have been forced to take a number of actions to combat the ongoing border crisis, which has seen a sharp rise in recent weeks.  In November, border patrol agents apprehended 192,000 migrants, up from 188,000 in October.  Governors from both states have deployed National Guard troops to assist Border Patrol agents in patrolling the border.  Texas also passed three new bills yesterday to deter the illegal immigration, including allocating state money to continue construction of the 1,200-mile border wall, increasing the minimum sentence for smuggling immigrants from two to ten years, and making it a criminal offense to enter the state illegally.

Republican Tony Gonzales of San Antonio warned it is “time to sound the alarm…  Our entire southern border is being dismantled by the cartels.”  In Arizona, Senators Kyrsten Sinema and Mark Kelly said in a joint statement, “For far too long, Arizona communities have paid the price for Washington’s failures on the border…  Our Ports of Entry are key drivers of economic growth and security in our state,” calling the migrant crisis “an unacceptable outcome that further destabilizes our border, risks the safety of our communities, and damages our economy.”

Carriers Suspend Operations in the Red Sea to Avoid Attacks


Major carriers have announced the suspension of all Red Sea operations following targeted attacks on commercial vessels, including an attack on the MSC Platinum III on December 15 in the Bab Al Mandeb Straight.  Thankfully, no injuries were reported, but the vessel suffered some fire damage in the drone attack and has been taken out of service.

The number of carriers refusing to risk Red Sea transits via the Suez Canal is growing by the day.  As of this morning, carriers who have opted to pause Red Sea transits and/or reroute around the Cape of Good Hope – along Africa’s southern tip – include MCS, Maersk, Hapag Lloyd, CMA CGM, ONE, OOCL, Zim, HMM, Evergreen, and Yang Ming; tanker owners Frontline and Euronav; car carrier Wallenius Wilhelmsen; and oil and gas companies BP and Equinor.  Additional carriers are likely to follow suit in the coming days.

Rerouting vessels around the Cape of Good Hope will lead to significant transit delays, adding roughly 10 – 14 days to sailing time.  Freight rates will also face upward pressure due to increased operating costs and fuel consumption.



What Shippers Should Expect from a Prolonged Diversion

As the transit route through the Cape of Good Hope adds 40% to the voyage distance, there will be a significant reduction in capacity due to fewer vessel turns.  As a result, vessel capacity will become tighter as carriers are forced to reduce the number of previously scheduled sailings – with some cargo possibly not able to find space – which in turn will drive up rates.  While we do not expect a repeat of the catastrophe experienced in the early days of the pandemic due to the current oversupply of capacity, the longer the detour persists, the more likely rates will be under pressure.  Additionally, shippers should be prepared for the potential of equipment shortages, as cargoes will travel further to reach their destination.

Carriers will continue to monitor the situation and will likely make adjustments to vessels and routings as the situation evolves, most likely at the last minute.

Shippers should also anticipate the imposition of additional surcharges – including bunker fuel (BAFs) and war risk – and general rate increases, which will further add to the landed cost of cargos.

Some experts are warning that further escalation of the violence in the Red Sea could potentially lead to a complete closure of the Suez Canal, and any disruption within these waterways will have a domino effect that could have dire consequences.  While a complete closure is unlikely, it cannot be ruled out.

About the Suez Canal

The Suez Canal connects the Mediterranean Sea to the Red Sea and provides the shortest maritime route between Asia and Europe.  It is one of the most heavily used shipping lanes, with more than 17,000 vessels passing through it annually, and accounts for ~30% of global vessel traffic.   The Bab Al Mandeb, which stretches 32km from the southern end of the Red Sea to the western end of the Gulf of Aden, serves as the sole route for vessels transiting the Suez Canal.


Germany: Hundreds of Flight Cancellations Amid Strike



Hundreds of flights have been cancelled at three major German airports after aviation security members of the Verdi trade union walked off the job this morning.

So far, more than 700 departing flights have been cancelled at Cologne Bonn Airport (CGN), Dusseldorf Airport (DUS) and Hamburg Airport (HAM) and more are expected tomorrow when security staff at Stuttgart Airport (STR) are expected to join in the walkout.

Verdi said it has been negotiating with the BDLS aviation security association, demanding pay increases to offset the rising cost of living as well as pay differentials for night, weekend, and holiday shifts, with no breakthrough in sight.  Negotiations between the union and management are expected to continue next week.


Confirm flights to CGN, DUS, HAM, and STR through at least the evening of April 21.  Anticipate possible disruptions to freight routed through any of these locations.  If possible, consider alternative arrangements for critical shipments.

Nationwide Rail Strike

In addition to the airport strikes, Germany’s EVG union has called for a nationwide transport strike on Friday, which includes national rail operator Deutsche Bahn.  Significant disruption is expected as regional and long-distance trains grind to a halt.