Ports in the Western Coast of the United States are seeing an upward trend in the increase of congestion once again, Port of San Pedro and Los Angeles Port leading from the front.
The number of ships, that are currently anchored at San Pedro and yet to enter the ports of Long Beach and Los Angeles, has started to increase at an alarming rate.
As per the mid-July data from the local marine exchange, more than twenty vessels were at anchor, awaiting berth space, reflecting the rise in imports from China after a pause during June, when as few as ten container vessels were waiting in the bay. The interruption concurred with the shutdown of substantial portions of the export hub of Yantian port in South China, which caused disruption to global container shipping to a noticeable degree.
Recent results for June showed that the Port of Los Angeles handled 82 containerships carrying 876,430 Twenty-Foot Equivalent Units (TEU). It was the busiest June in the port’s long history – and a nearly 27% rise, compared to June 2020, when volumes were reduced due to the pandemic.
Shipping has come into the limelight, as supply chain disruptions are a common issue today. Carl Bentzel, a Commissioner at the Federal Maritime Commission, in the mainstream Washington Post, mentioned that he is extremely concerned now about the economic impact as a consequence of the current situation. This could be the first time the public sees the impact of maritime shipping disruption since World War II.
This comes at a time that lobbyists for cargo interests, in Washington, DC, are pushing the U.S. Congress to pay heed to the actions of carriers, including the expedited return of empty boxes to Asia, rather than offering them to the US exporters. The carriers, conversely, point to landside delays for the record throughputs, rather than anti-competitive practices.
Data from the Port of Los Angeles bears out the latter viewpoint. A mid-July report shows a six-day average time at berths for containerships, contrasted with mid-June times of typically four or five days (and sometimes as low as three).
The latest issue of The McCown Report, which details year-over-year container volumes, notes that, overall, the top US container ports saw the inbound box trade grow by 32.5%, in June, down from the previous month’s 52.2 % gain. McCown, who has four decades of management experience in the container sector, noted that most of the growth had occurred at ports in the US Gulf/US East Coast.
He further added: “The data and news reports indicate that shippers are electing to switch containers ultimately destined for eastern points to East Coast ports in an attempt to avoid congestion issues that have been most visible at West Coast ports.”
This movement away from the West Coast, to the Gulf / East Coast, closer to the majority of US consumers, is part of a longer-term trend that started in 2016 when the widened Panama Canal was opened. McCown remarks that direct rail to Eastern destinations on boxes offloaded at West Coast ports after arriving from Asian origins is faster than the all-water route to the East Coast.
He noted: “The issues regarding the congestion may have shippers reanalyze their routing preferences, as East Coast/ Gulf Coast were less impacted and some also have more room to expand.”
He also praises shippers’ examination of “the carbon emissions of their freight-related activities,” adding that, this too could lead to further switching to all water routes into East Coasts and the Gulf.