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October Port of Long Beach container volumes slump as congestion mounts

  • Author
  • Greg Holt
  • Editor
  • Valarie Jackson
  • Commodity
  • Shipping

Container throughput at the Port of Long Beach fell on a year on year basis for the second consecutive month in October as severe congestion resulted in a new record of ships waiting to berth at the port.

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The Port of Long Beach handled 789,716 twenty-foot equivalent units in October, down 2.1% from the same month last year but still the second-busiest October on record, the port said on Nov. 11. Loaded imports in October fell by 4.3% year on year while loaded exports rose by 6.6% over the same period.

"Every sector of the supply chain has reached capacity and it is time for all of us to step up and get these goods delivered," said Port of Long Beach Executive Director Mario Cordero. "In Long Beach, we are trying to add capacity by searching for vacant land to store containers, expanding the hours of operation at terminals, and implementing a fee that will incentivize ocean carriers to pull their containers out of the port as soon as possible."

Long Beach and the neighboring Port of Los Angeles began assessing a Congestion Dwell Fee from Nov. 1 of $100/day per container for cargoes that remain on a terminal for more than eight days. The fees will also increase by $100/d, such that the cumulative charge will be $300/container on day 10 and $1,500 on day 13.

The two adjacent Southern California ports allowed a two-week grace period until Nov. 15 to give shippers and carriers a chance to remove their cargoes, which has already resulted in a 20% decline in loaded import containers dwelling beyond their respective limits, the Port of Long Beach said.

In an advisory to customers Nov. 11, Danish shipping firm A.P. Moller-Maersk said the dwell fees charged to carriers would be passed along to shippers as an Emergency Government Port Storage Charge. The lack of available truck chassis to remove the container was not an exemption, the company said.

But Maersk said it is also in the process of securing additional land outside the marine terminals for storage of containers that can not yet be transported, which would avoid the exponentially increasing dwell fees but would still be subject to demurrage charges.

"As there is only a finite amount of capacity at these holding yards, movement will be subject to availability," Maersk said.

The queue of ships at anchor waiting to berth at the dual ports of Los Angeles and Long Beach or drifting nearby in the San Pedro Bay grew to a new record of 81 ships Nov. 9, the first time the queue topped 80 vessels, according to the Marine Exchange of Southern California.

There were 77 ships in the queue Nov. 11, according to cFlow, Platts trade flow software. Platts Container Rate 13 — North Asia to West Coast North America — was assessed at $8,500/FEU Nov. 11, a 127% increase from the same date a year ago.