Worsening LA-LB port congestion delays recovery until March
CONGESTION at the Los Angeles-Long Beach port complex is worsening, having bled into intermodal rail operations and drayage to regional warehouses, pushing back expectations for relief to no sooner than March
CONGESTION at the Los Angeles-Long Beach port complex is worsening, having bled into intermodal rail operations and drayage to regional warehouses, pushing back expectations for relief to no sooner than March.
'We still remain in peak situation. We are expecting relief around the third week of February,' said Gene Seroka, executive director of the Port of Los Angeles. December was a big month for the ports, with imports increasing 21.6 per cent in Los Angeles and 7.9 per cent in Long Beach, according to port statistics.
Rather than dissipating with the onset of the Lunar New Year as anticipated, port sources are now projecting congestion will remain for about two more weeks. Truckers, who are finding it increasingly difficult to secure appointments at the marine terminals and deliver inbound containers to severely impacted import distribution centers, are suffering collateral damage because of mounting storage charges.
The largest US port complex, which handles close to 40 per cent of US imports, has struggled with congestion problems since last autumn due to a busy peak season for holiday merchandise, followed immediately by front-loading of imports as retailers and manufacturers attempted to get ahead of threatened 25 per cent tariffs on more than US$200 billion of imports from China.
The more than 1.5 billion square feet of industrial real estate space in Southern California was oversubscribed because retailers delayed in shipping their spring merchandise to the eastern half of the country, causing inbound containers to back up at the ports. Making matters worse, an unusually large number of inbound containers and empties have been stored on chassis throughout the region, resulting in a chassis shortage.
When container and chassis dwell times began to drop last month, the ports and terminals predicted congestion would dissipate in February and the harbour would return to fluidity later in the month. Now, the predictions do not look as rosy, reports IHS Media.
'From what I've heard, everyone thought it would be over sooner than this. It's still pretty bad,' said Michael Klage, solutions director at TOC Logistics International. Even in some cases where containers have been cleared, truckers cannot take delivery of the inbound loads because they can't secure enough chassis, he said.
Chassis shortages and dislocations are contributing to the congestion at the marine terminals and warehouses. Hundreds of chassis are sitting under loaded import containers that can't be unloaded at the warehouses. Hundreds more are stuck at trucker yards and warehouses with empty containers that marine terminals are refusing to accept because there is no space at the terminals for the empties.
Currently there are about 26,000 chassis at the 12 container terminals and four intermodal rail yards in Southern California, the same as for the past six weeks. Chassis street dwell time is also unchanged at about five days.
The backlog of containers at the marine terminals because imports can't be drayed to distribution warehouses in a timely manner is now being compounded by service issues at the western railroads, BNSF and Union Pacific. The railroads are not departing trains on schedule, especially to secondary locations outside of the major hubs such as Chicago and Dallas Fort-Worth, so intermodal containers that should be moved from the marine terminals within 24 hours are sitting there for days.
The congested terminals are playing havoc with truckers' ability to make sufficient round trips because drivers spend too much time in long lines. Average turn times in the port complex from October through December spiked to 90 minutes from less than 80 minutes for most of the year, according to the Harbour Trucking Association.
However, Fred Johring, president of Golden State Logistics, said it is the exceptions that are causing the greatest problems with turn times. 'We have quite a few that are well over two hours,' he said. 'In the last 30 days, 9 per cent of our visits were over three hours, 4 per cent were over four hours, and 2 per cent over five hours.'