Heavy volumes increase congestion at major ports

Relief is expected when volumes dip after Lunar New Year, which begins Feb. 5.

Heavy volumes increase congestion at major ports

Relief is expected when volumes dip after Lunar New Year, which begins Feb. 5.

Heavy volumes increase congestion at major ports

Relief is expected when volumes dip after Lunar New Year, which begins Feb. 5.

 
The ports of Los Angeles and Long Beach, as well as the Port of New York and New Jersey (PANYNJ), are facing congestion due to heavy import volumes, according to various forwarders.
    Silicon Valley-based freight forwarder Flexport said in a weekly update Wednesday, “We’re seeing extreme congestion at Los Angeles/Long Beach and New York ports as a result of the influx of import volume in advance of the tariff hikes, peak season and Chinese New Year preparations. The large import volume is causing a chassis shortage and long pickup times, so you may experience some shipment delays in the next few weeks.”
    Flexport said it expects the backlog at the PANYNJ to take longer to clear because those terminals are not open at night or on weekends. However, that was disputed by Dick Jones, the executive director of the Bi-State Motor Carriers at the PANYNJ, which said the port terminals are offering extended or weekend hours. For example, the port authority’s alert system showed APMT in Elizabeth would be open from 6 a.m. to 1 p.m. Saturday and PNCT would be open from 8 a.m. to 5 p.m. Monday.
    Jones said congestion is in part the result of heavy volume and the three-day work weeks that occurred around the Christmas and New Year holidays. “Some of that stuff is still dragging out,” he said.
    Additionally, he said wait times at some terminals is two to three hours, about twice as long as normal, but he also added not all terminals are affected.
   Steve Coleman, a spokesman for the PANYNJ, said, “In the fourth quarter 2018, there was a shift of cargo in the port and APMT took on 200,000 additional containers on short notice. That additional cargo also came during the holiday period when the port was closed for Thanksgiving, Christmas and New Year.
    “In addition, there were labor shortages around the holidays that contributed to the problem, as well as chassis shortages, given that containers were staying on chassis longer than normal, being that there were also issues in the warehouse sector with warehouses unable to quickly handle additional cargo,” he said.
    “To alleviate the situation, other terminals in the port are assisting with the handling of cargo that was coming into APMT,” he added. “In addition, APMT began to operate Saturday gate hours and added one and a half hours to their gate times on weekdays, closing at 5:30 instead of 4. Now that the holiday season is over, the labor situation is returned to normal levels.”
    Coleman added, “The port authority has been actively engaged with all of the port terminals to alleviate congestion and is continuing to work with them to streamline the process, given that cargo volumes will remain strong in January and February.”
    Meanwhile, Overland Park, Kan.-based MIQ Logistics said, “Los Angeles and Long Beach terminals continue to experience heavy congestion due to the unprecedented volumes arriving in the U.S. in anticipation of the upcoming Lunar New Year and the pending tariff changes.”
   The Lunar New Year, a major holiday in China and other Asian countries, is Feb. 5. Since many factories shut down for a week around the Lunar New Year, often times shippers move cargo in advance of the holiday. In addition, volumes were exceptionally high in December because shippers brought cargo into the country in advance of the Trump administration’s threat to raise tariffs from 10 percent to 25 percent on $200 billion of imported goods from China on Jan. 1. That date has been pushed out to March while trade talks continue.
    “Containers are sitting longer than normal, and once the containers are out-gated, many are staying out longer than normal,” MIQ Logistics said. “These delays are contributing to chassis shortages in the area.”
    Last month, the Pacific Merchant Shipping Association (PMSA) said average container dwell time at the ports of Los Angeles and Long Beach was on the rise, signaling congestion. At 3.51 days in November, dwell time was at the highest level it has been in two years, up from 3.26 days in October and 2.89 percent in September. December figures are due out next week.
    PMSA said, “It is absolutely critical that containers continue flowing out of terminals in less than three days,” but in November, 13 percent of all containers were sitting at terminals for more than five days before getting picked up for delivery, as compared to 11 percent of containers exceeding a five-day dwell time in October and only 5 percent the month before.
    Jessica Alvarenga, manager of government affairs at PMSA, explained, “Terminals rely on containers getting picked up in a timely manner in order to handle more containers efficiently.”
   Dana Grbic, vice president of pool operations at Flexi-Van, said that the week of Jan. 7, chassis “pool of pools” to which Flexi Van, DCLI and Trac Intermodal all contribute equipment, had a street dwell of up to seven days. However, street dwell time had come down to five days last week. Dwell time for chassis on terminals also fell from five days the week of Jan. 7 to three days last week. The pool of pool posts weekly updates on the chassis supply situation in Los Angeles and Long Beach here.
    Grbic said street dwell rose about 32 percent between January 2018 and January of this year.
    Additionally, Grbic said with warehouses in Southern California being at capacity, chassis and containers are being “used as storage for cargo until space can be made available on store shelves for the merchandise and allow for more cargo to be unloaded from containers into warehouses.”
    After Chinese New Year, fewer ships are expected to arrive while factories are shut down, which Grbic said “should help reduce congestion. Then, typically we will head into slack season until approximately mid-April.”
    She also said “chassis dislocation,” in which truckers are required to return empty containers to terminals that are different from where they picked up an import load, continues to be an issue.
    MIQ Logistics said, “As terminals try to manage the increased volumes, they are having issues evacuating containers due to chassis issues. Congestion issues worsen as they start to face gridlock. Terminals are maxed out space-wise, and the normal flow of appointments is being interrupted as they simply have too much in certain areas of their yards to be able to work. Some terminals are refusing to accept empties from carriers while they try to dig out of the volumes they have on dock. Overwhelmed terminals are beyond capacity and moving containers to undeliverable areas until they have space.”
    Gene Seroka, executive director of the Port of Los Angeles, said the port plans to aggressively pursue empty container and chassis returns in advance of cargo arrivals prior to the new March 1 deadline for tariff negotiations.
    MIQ Logistics also noted that truckers are in high demand, adding, “Railcar supply is also challenged, forcing terminals to change many destinations from on dock to off dock. These changes mean that containers need to be trucked out of the port, placing more pressure on trucker and chassis supply.”

I think LNG is a transitional fuel. It’s not the fuel for the future.  However, it meets all the regulations that’s out there ... vessels need to operate under until 2050. It gets us through until we figure out what that next fuel is.

The Port of Oakland in May handled 85,964 TEUs of loaded imports and 78,070 TEUs of loaded exports, up 4.2% and 8.4% year-over-year, respectively.

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Heavy volumes increase congestion at major ports

Relief is expected when volumes dip after Lunar New Year, which begins Feb. 5.

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Heavy volumes increase congestion at major ports

Relief is expected when volumes dip after Lunar New Year, which begins Feb. 5.

Jan 21, 2019 on Dec 27, 2018AmericanShipper.com