The Biden administration is “not waiting one minute to address supply chain disruptions,” U.S. Secretary of Transportation Pete Buttigieg said Tuesday during his visits to the Port of Long Beach.
Joining local and state officials like Los Angeles Mayor Eric Garcetti and California Congressman Ted Lieu, along with port executive directors Gene Seroka and Mario Cordero from the L.A. and Long Beach gateways, Buttigieg credited the collective’s efforts in recent months for improving the congestion that has clogged up container imports. Talks will continue and resources will continue to flow to the ports, with imminent federal funding from President Biden’s $1.2 trillion infrastructure bill, he said.
“One of the reasons why Christmas was not canceled is that ports like L.A. and Long Beach moved record levels of goods, allowing an all-time record high in terms of retail sales this holiday season,” Buttigieg said. “Considering the pressures that this country and these communities have been under, that is an extraordinary achievement.”
The San Pedro Bay complex topped its all time record for container processing by 14 percent in 2021, he added. In spite of the spike in cargo, he noted that American shoppers received 99 percent of their packages on time or with minimal delays throughout November and December.
The significance of the ports’ achievement is about more than “presents under the tree,” Buttigieg said. The rapidly spreading Omicron variant escalated the need for medical goods and fueling a surge in shipments of PPE from foreign producers. While the ports anticipated a slowing of shipments following the end-of-year deluge, the evolving public health challenge will continue to strain operations, Buttigieg said. “As long as the pandemic persists… we are going to see impacts on shipping times and shipping costs.”
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“There’s no question that when you have a scarcity of access to shipping, you’re going to see upward pressure on prices, and that’s going to be part of our challenge when it comes to inflation,” he added. The Biden administration is committed to addressing the issue through enforcement actions should “price gouging” on goods continue to impact consumers and American shippers. “A lot of this is market forces,” he said, adding that “nobody wants the federal government to own and operate warehouses or grocery stores or shipping companies.”
“But we do have a responsibility to make sure that the physical infrastructure that those private-sector supply chains sit on is well maintained,” he added, “and that there is the right kind of coordination among the different players.”
Persistent hurdles are “not because the ports became less capable or because the workers delivered less output” in the face of Covid, Buttigieg said. “In fact, the reverse is true.” He cited efforts to improve the backlog, like opening up 24-hour-a-day operations and the contentious and oft-postponed dwell fee, that reduced the container pileup by nearly 50 percent.
Now, the port complex must make up for decades of delayed infrastructure investments, Buttigieg added. The Port of Long Beach was the primary recipient of funding from the U.S. Department of Transportation’s Maritime Administration (MARAD) in late December, to the tune of $52 million for its Pier B rail project. The centerpiece of the port’s $1 billion rail capital improvement program, Pier B construction will allow for the greater transport of cargo by train, alleviating backlogs caused by terminal truck traffic.
Buttigieg is eager to put “$17 billion” to work on the ports.
“Nothing about this will be easy,” he said. “But a lot of this is about physical infrastructure, and that is going to get a lot better, thanks to the funds from the president’s infrastructure law and the support of the leaders that you see around me.”