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Gridlock Threatens Record SoCal Cargo Ops

Cargo movement data tracked by Project44 shows surging congestion across all four major Southern California ports–Los Angeles, Long Beach, Hueneme and San Diego.

According to data collected by the supply chain visibility company as of Thursday, 41 vessels were anchored outside of the twin ports of Los Angeles and Long Beach waiting for berth space, while 33 were moored at both ports. Congestion at those and other ports had peaked in late spring before easing somewhat in early summer. Not since February’s peak of 40 vessels waiting at anchor has congestion been this severe.

However, the latest gridlock, according to Project44 data, indicates that regional ports are rallying, handling record volumes as shippers rush to get products to warehouses and store shelves in time for the holidays. Despite the backlog, the Port of Los Angeles is reporting record productivity this year, handling upwards of 11,000 container units per vessel.

In June, the Port of Los Angeles became the first port in the Western Hemisphere to process 10 million container units in a 12-month period, closing out fiscal year 2020-21 with nearly 10.9 million TEUs handled. In May 2021, the port processed more than 1 million TEUs–the busiest month in the port’s 114-year history and the first time a Western Hemisphere port has reached the 1 million milestone in one month.

Project44’s Insight Report said industry experts attribute the latest surge to proactive shippers bolstering their inventories in preparation for the holiday season. But processing the influx of containers across West Coast ports is running up against capacity issues facing North American rail and road carriers, as inland congestion sparks additional delays.

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Despite the record number of containers being processed at the Port of Los Angeles and Long Beach, the West Coast’s antiquated rail and road infrastructure is preventing the efficient removal of containers out of the port.

Los Angles port director Gene Seroka said the port is facing a daily 30 percent no-show rate for truck appointments. According to Project44 data, the average weekly dwell times at Los Angeles and Long Beach dropped by nearly three days last week indicating a strong rally to handle the backlog of container vessels.

Blank sailings to Long Beach connecting Chinese manufacturers to U.S. businesses are not showing significant changes, indicating that carriers are either confident of the port’s ability to process the box volume or that there are simply no other alternatives, Project44 suggested.

The report noted that even with port infrastructure and personnel meeting the cargo volume challenge, the capacity/volume mismatch between maritime ports and overland transport could worsen in the weeks and months ahead, setting the stage for another breaking point in supply chains.

The terminal closure at China’s Ningbo-Zhoushan port will also play a crucial role in the port congestion scenario, Project44 said. The May-June closure of the port did give Los Angeles-Long Beach a brief reprieve from the incoming volume, resulting in a temporary reduction in congestion. But then there was an increase in congestion as delayed cargo from Ningbo eventually started arriving.