The ports of Los Angeles and Long Beach have been overburdened with a deluge of container imports over the last few months. As a result, cargo heading into and out of the ports has slowed to a relative crawl, as the ports deal with record-breaking volume alongside a reduction in staff related to the COVID-19 pandemic.
This slowdown resulting from high levels of imports has created congestion at terminals and in surrounding areas.
The charts below show the impact of record imports and congestion at the Southern California port facilities.
Imports surge to historic highs
High import levels are driving the congestion. Loaded imports were up more than 23% YoY for The Port of Los Angeles in December and nearly 26% YoY at the Port of Long Beach.
"The spike in imports is unprecedented in scale, breaking new records on a monthly basis," Port of Los Angeles Executive Director Gene Seroka told the Los Angeles Board of Harbor Commissioners this month.
The high import levels are a result of increased consumer spending and retailers working to restock their inventory. Spending has shifted away from services, such as movies and restaurants to physical goods, generating record-breaking import levels at the nation's water gateways.
The import levels are well above the pre-tariff import levels seen in early 2019, as importers tried to beat an increase in fees, which also resulted in congestion and equipment shortages.
The latest forecast from the Port of Los Angeles shows the heavy stream of containers continuing through February, and Seroka said the backlog created at the port could continue into the summer, as a result.
This is in line with a forecast from the National Retail Federation, which expects record-breaking import levels through the first six months of 2021.
Maersk also expects the import frenzy to continue. "It's really extraordinary," CEO Søren Skou said last week of the demand for U.S. imports.
Some West Coast terminals see uptick in turn time
As the imports are unloaded from container ships and brought onto land, more issues start to arise. Terminals' and facilities' stacks fill, and truckers work to move containers out to their next destination.
Pier 400, operated by APM Terminals, is the largest terminal at the Port of Los Angeles and has seen its average turn time more than triple YoY (a 213% increase), according to figures from the Harbor Trucking Association.
Part of the turn time uptick is due to how full the port facilities are. At the Port of Los Angeles, the facility is considered full if containers occupy 80% of the space. As of last week, the space was 95% covered in containers.
"When a ship comes alongside to the terminal, it is taking longer to work, simply because you've only got that narrow prism view left to put the containers coming off that new ship," Seroka said.
Terminal dwell exceeds 5 days for more than one-fourth of shipments
As turn times increase and more imports flow into the ports, the containers are staying there longer. In December, 26% of shipments had a dwell time for greater than five days, according to the Pacific Merchant Shipping Association.
"The containers themselves [are] witnessing dwell times that are at peak levels now, on terminal as well as on the street," Seroka said.
Seroka also said the labor shortage due to COVID-19 "is a concern in general, but it is not the driver to the situation."
More ships anchor, waiting their turn to berth
All of this slowdown has resulted in a long line of ships, anchored in the San Pedro Bay, waiting for a berthing spot.
In a webinar last week, Kevin Krause, the vice president of Ocean Services at Seko Logistics, noted that 30 or more container ships have been seen at anchor recently. And if each is hauling around 10,000 TEUs, that's "300,000 TEUs tied up, which are just not going anywhere while they're waiting for berth," Krause said.
The average time ships spent at anchor in December was 4.6 days and reached 7.3 days in January, Seroka said.
"The cost across the supply chain is very heavy, millions of dollars per vessel per day, when they sit not doing their business," he said.
Getting workers vaccinated is an important part of ensuring the port runs smoothly, as a lack of labor has partially hamstrung the facility, Seroka said.
"Any person that doesn't go to work on a given day or given shift is one less worker that we need right now," he said. "We've got more cargo than ever before on the inbound side."