LA-LB ports face truck chassis shortage due to work shift cancellations
CONTAINER yards in southern California are becoming chock full of empties that have nowhere to go, raising the prospect of a shortage of chassis since beneficial cargo owners (BCOs) are struggling to return empty containers to terminals at the ports of Los Angeles and Long Beach
CONTAINER yards in southern California are becoming chock full of empties that have nowhere to go, raising the prospect of a shortage of chassis since beneficial cargo owners (BCOs) are struggling to return empty containers to terminals at the ports of Los Angeles and Long Beach.
This situation has arisen as operators at the twin port complex have been cancelling dozens of work shifts due to plunging cargo volumes, and shipping lines are blanking sailings, which are making it increasingly difficult for shippers and truckers to return empty containers, reported IHS Media.
The steep drop in US imports started with the prolonged closure of factories in China for the Lunar New Year holidays and accelerated due to supply chain disruptions caused by the spread of the coronavirus.
The backlog of empty containers at marine terminals, warehouses and trucker yards is escalating by the day, and chassis shortages could develop because the vast majority of idled empty containers are sitting on chassis, effectively taking that equipment out of service for days on end.
'It's a growing issue, and it will be a massive equipment issue if it continues,' Harbour Trucking Association CEO Weston LaBar said.
Most of the 12 container terminal operators in the Los Angeles-Long Beach port complex began to manage the return of empty containers last month in order to avoid yard congestion.
'If you fill up a terminal with empties, you don't have enough space to handle the containers that are coming in. That's the issue,' SSA Containers president Ed DeNike said.
Some terminals last month began notifying BCOs they would only issue appointments for the return of empty containers to truckers that were also taking delivery of full containers coming off of ships.
Several terminal operators said this action was taken because the blank sailings have significantly reduced the outbound vessel capacity needed to return the empties to Asia, and they simply do not have enough space to handle thousands of empty containers with nowhere to go.
Carriers have cancelled, or have announced intentions to cancel 111 transpacific sailings to North America from early February to early April, according to Sea-Intelligence Maritime Consulting.
According to a schedule of gate closures, individual terminals in Los Angeles-Long Beach recently cancelled 25 day or evening work shifts between Monday and Friday.
Import distribution centres that cannot return containers to the terminals after they are unloaded must store the empties, each of which is resting on a chassis, at their facilities. As those warehouses run out of space, they attempt to get their truckers to store the empties in their yards, but now the truckers say they're running out of space.
'The container yards are becoming chock full of empties. There's nowhere to put them,' Mr LaBar said.
The refusal of some terminals to accept empty returns, or the difficulty truckers encounter in getting terminals to post enough appointment slots for truckers, result in issues involving detention fees for the late return of equipment.
'Some carriers are not charging per diem, but others are saying you have to prove you can't get the empty back,' Mr LaBar said.