As an update to our advisory from last month, the situation at the ports and terminals of Los Angeles / Long Beach is deteriorating with continued throughput of record cargo volumes which is expected to continue for the foreseeable future. While this has been viewed as a positive sign the economy continues to recover from the downturn earlier this year as a result of the ongoing COVID-19 pandemic, it is now resulting in significant ongoing challenges that now impact all customers cargo flows. These challenges include;
- Vessel operations – Vessels are waiting off shore until berth space becomes available. We’re seeing reports of insufficient ILWU labor being available to work incoming vessels, which results in slower operations. Delays in arrival at berths and slower discharge/load operations is also starting to have a domino effect on schedule integrity to the point where some strings are seeing blank sailings from Asia.
- Terminals – congestion is now to a point where it’s causing vessel arrival & berthing to be delayed in order to ensure sufficient space is available to off-load and stage containers. The delayed arrival & berthing of vessels is also leading to changing Earliest Receiving Dates for export cargo, which impacts the ability of truckers to turn in export containers timely, since appointments have to be changed. It’s also leading to turn-times of between 4 - 10 hours per move!
- Terminal appointments – due to the record volumes, truckers are seeing earliest appointment times to pick-up import containers being available after cargo Last Free Day, which results in demurrage charges being incurred. Such charges are required to be paid to terminal operators / ocean carriers prior to release of the cargo.
- Chassis’ – the shortages are getting worse as dwell times are now exceeding 7+ days due to containers/chassis being held at import DC’s, many of which are at capacity or operating at a slower pace due to a reduction in the availability of labor. This in turn impacts the ability of truckers to collect import containers or pick-up empties for export loads.
- Truckers – the increased volumes and resulting terminal congestion, slower turn times inside terminals, chassis shortages and driver shortages are now resulting in higher rates being assessed by truckers of at least US$200.00 per container. Earliest availability of drivers for truckers is now averaging 3-4 weeks!
We continue to monitor the situation at the 13 terminals operating in the LA/LB port complex and work as pro-actively as possible with our extensive trucking vendor network to mitigate the impact of the ongoing situation has on you, our client. However, it should be understood that whenever additional charges are being incurred as a result of the current conditions, these are ultimately for account of the cargo and due in full.
Our teams will continue to monitor the situation and keep you updated as best possible. In the meantime, should you have any questions, or concerns, please don’t hesitate to contact you Kuehne+Nagel sales or customer service representatives.
