The Port of Long Beach reported its second-busiest October on record last month as it works to clear a backlog of containers that has limited capacity at terminals and hampered the flow of imports, the port said Thursday.
Volumes were strong enough to mark the port’s second-busiest October on record behind October 2020. Stevedores and terminal operators moved 789,716 TEUs last month, down 2.1% from last year.
Imports in October were down 4.3% to 385,000 TEUs, while exports were up 6.6% to 122,214 TEUs. Empty containers moving through the port, which have been a major contributor to the backlogs and highlight the significant trade imbalance, were down 2.4% to 282,502 TEUs.
“All sectors of the supply chain have reached capacity and it’s time for all of us to step up and get these goods delivered,” said Port of Long Beach CEO Mario Cordero. “In Long Beach, we are trying to add capacity by finding vacant land to store containers, extending terminal operating hours and implementing a fee that will incentivize ocean carriers to get their containers out of the Port as soon as possible.”
The fee Cordero refers to is the expanded “dwell rate” that the ports of Long Beach and Los Angeles are implementing to incentivize the flow of cargo containers moving through the two San Pedro Bay ports. The new policy imposes a daily fee on ocean carriers for the dwell time of import containers at the marine terminals, which starts at $100 per day and increases in increments of $100 for each day beyond the allowed dwell time (9 days or more for truckloads and six or more for rail). Ocean carriers have until November 15 to clear imported containers, which have already been unloaded from their vessels, before the fees are applied.
As of Nov. 10, the Port of Long Beach reported a 20% decline in loaded import containers that have remained at the port’s terminals beyond their respective time limits. Figures released by the port, however, show that there are still more than 21,000 import containers currently facing charges of at least $100, if not exponentially more considering the figures released by the port only show the total number of containers beyond the allowable dwell time limit, but not the amount of time spent. At the current level, ocean carriers would face a minimum charge of $2.1 million (based on 21,000 containers at $100 each, the minimum charge), costs that will ultimately be passed on to the shipper and, in turn, the consumer.
Next door, at the Port of Los Angeles, data released by the port shows that more than 30,000 import containers have been “detained” for 9 days or more, each facing a minimum charge of $100. Among them are more than 24,000 containers that have been held 13 days or more, each facing a minimum fee of $1,500 each, or $36,000,000 (assuming they are all truckloads that have been held 5 or more days beyond the 8 days allowed).
As has been reported for weeks, the Port of Long Beach also continues to work with marine terminals and supply chain partners to extend hours as part of a framework for 24-hour-a-day operations.
“We are working around the clock at the Port,” said Long Beach Port Commission President Steven Neal. “We’re doing everything we can with the help of the supply chain to get goods off the ships and onto store shelves in time for the holidays.”
Despite negative year-over-year growth in October, year-to-date volumes through the Port of Long Beach are up significantly. Through the first 10 months of the year, the port has reported handling 7,884,565 TEUs, up 21% over the same period in 2020. At the current pace, the Port of Long Beach is on track to move more than 9 million TEUs by the end of this year, surpassing the current record of 8.1 million TEUs reached in 2020.
“Consumer spending lagged slightly in early fall, but remains above pre-pandemic levels. Employment is recovering faster than in the periods following the dot-com bust and the Great Recession, and a full employment recovery is projected by mid-2022,” the port said in its monthly update.
The Marine Exchange of Southern California, which manages vessel traffic services for the San Pedro Bay port area, shows that the number of container ships at the ports of Los Angeles and Long Beach reached a record 108 vessels in October, including a record 77 at anchor or loitering in waiting areas.