If there ever was a time to get creative with international freight, it’s now. Congestion at US ports has hit record levels at a time when brands are desperate to replenish inventories for the peak shipping season.
Here’s a snapshot of the situation at 3 of America’s most congested seaports as of October 26:
|Sea Port||Vessels at Anchor||Average anchor time|
|Los Angeles||37||13.2 Days|
|Long Beach||39||12.6 Days|
|Savannah||30||8 days (as of Oct. 15)|
The White House’s push for 24/7 operations at the LA/Long Beach port complex has not been implemented. Even if it was, the problems go much deeper.
- Warehouses are full. Retail inventory is low and replenishment is ongoing. There is limited space to store the inventory. Even the container yards at warehouses near ports are full.
- 30% of available appointments at terminals are unused. Many factors are driving this situation, including:
- A driver shortage – 80,000 additional drivers would be needed to address the current shortfall in the US trucking market.
- Strict terminal appointment requirements – Free time starts to count once a terminal deems your containers are available for pick-up. Late pick-up due to lack of equipment or chassis is an external issue. This is severely limiting the pick-up resources many truckers have. As a result, containers are incurring demurrage penalties, which Importers have to pay.
- Chassis are in short supply – Several terminals within the LA/Long Beach port complex are out of chassis. Also, local chassis pools are extremely limited with no equipment on hand. The average cycle time for a chassis (street dwell) is 9.3 days.
- Empty container returns are affected, too – As the terminal is the same as import containers, many empty containers are not able to return to terminal for the same reasons, and the terminals are simply too full to accept containers going back in. This consequently contributes to warehouses and trucker yards being full.
- Container cycle time is increasing. Time spent in the terminal plus time on the street for a gate-out load has increased from week 37 to week 40. It’s gone from 13.3 to 16.0 days for 20’ containers and from 11.5 to 13.5 days for 40’ containers.
To try to ease the situation, everyone is being creative. That includes the City Manager of Long Beach, who temporarily eased the container stacking rule on Oct. 22, allowing truck yards to stack containers up to five high for the next 90 days. Trucking companies can now pile up empty containers in their lots near the port. On October 25, officials at LA/Long Beach ports said they will start fining Ocean Carriers, starting November 1, whose containers linger for too long at marine terminals. Arriving containers scheduled to be moved by trucks will incur an “emergency fee” starting on the ninth day, and for containers set to move by rail, on the third day.
What is Dimerco’s recommendation?
Currently there are no signs that volumes will decrease or that landside operations will loosen up. Forecasts say the congestion will last well into the first half of 2022, at least. To overcome congestion at US ports, we suggest that you book your cargo early – at least 4 to 6 weeks ahead – in consideration of the longer lead times. Share your forecasts with your freight forwarder and ensure prompt updates are made, if needed. Urgent freight may be routed via a different mode, such as airfreight.
Want to get creative about service alternatives? Let’s talk.