Shipping a container of hazardous chemicals from Shanghai to Chicago used to cost John Logue about $6,600. Now, the Royale Group chief executive pays as much as $29,000 — and that’s if he is lucky enough to find space on one of the much-sought-after cargo vessels plying the Pacific trade routes.
Logue’s oceangoing headaches are mirrored on land, where Royale Group shipping containers routinely get stuck in rail yard logjams that lead to costly and unpredictable storage charges. The Royale Group’s double-barreled freight troubles, which hamper both existing operations and Logue’s efforts to return manufacturing to the United States, illustrate the market power of the handful of shipping companies and railroads that bring goods from distant factories to American homes.
On Friday, President Joe Biden called on regulators to crack down on consolidation in the shipping and rail industries, as part of a broad executive order promoting competition throughout the U.S. economy.
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