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Anchored container ships weigh down Port of LA’s volume

November TEU count was up 22% year-over-year but could have been higher

Although the sun is setting on 2020, volumes remain unusually strong at the Port of Los Angeles. (Photo: Jim Allen/FreightWaves)

November container volume at the Port of Los Angeles was up 22% year-over-year to more than 889,000 twenty-foot equivalent units (TEUs).

That number could have been closer to 990,000, according to Executive Director Gene Seroka. 

“It’s worth noting that there were 12 ships at anchor on November 30 awaiting berthing rights here in Los Angeles with an estimated 100,000 TEUs on board. Those vessels were delayed by about two days and thus shifted into our December data,” Seroka reported during a virtual press conference Tuesday.

Seroka said 88 container vessels called the Port of LA in November. There were nine “extra loaders,” added calls because of high demand in Asia, and there were no canceled sailings. 

“After 11 months of year-on-year cargo declines, we’ve now stitched together four consecutive months — August through November — of year-on-year growth. During this period, the monthly TEU average was almost 930,000 units, an indicator of the powerful import surge and its duration,” he said. 

Seroka said the pattern of heavy warehouse and distribution center inventory replenishment continued in November, and holiday orders still are moving across the docks, later than in years past. 

“It is unusual to see this kind of import volume so late in the year. As we all know, 2020 has been anything but normal,” he said.

The continuing surge is reflected in the 464,000 TEUs of imports moved at the Port of LA in November. That’s a 25% year-over-year increase, Seroka said. 

“Remarkably, the import push has erased the deficit from the first half of 2020,” he said. “Imports are now up about 1% compared to last year.”

Exports totaled more than 130,000 TEUs, “a disappointing 5.5% decrease compared to last November. Year to date, exports are down 13% and have dropped a woeful 23 out of the last 25 months, mainly on the heels of the continued and ongoing trade tensions with China and the strength of the U.S. dollar, making our goods expensive to sell in overseas markets,” Seroka said.

“Empty containers exceeded 294,000 TEUs for the month, a 34% increase compared to last year,” he continued. “Empties are still in high demand in Asia, and once again empty containers outstripped by two times the amount of loaded American exports that departed the Port of Los Angeles.” 

From Jan. 1 to Nov. 30, the Port of LA moved about 8.3 million TEUs, Seroka said. “That’s about 3% behind 2019. It’s a number that many would not have believed was possible to reach when we were down nearly 20% after the first five months of this year.” 

Using data from The Signal, the port expects to handle about 875,000 TEUs in December, a 17% year-over-year increase. The current full-year projection for 2020 is 9.2 million TEUs, a little over 1.5% lower than 2019.

“Considering the roller coaster that we’ve been on all year long, I’m pleased with how we’re finishing this challenging year of 2020,” Seroka said.

The new year also is expected to start strong. 

“Our first look at January volume indicates approximately 850,000 TEUs, which would be about 5% more than a very busy January 2020,” said Seroka, who pointed out retailers and economists are forecasting imports will remain strong through at least early spring. 

“We’ll see a little bit of a volume dip following Lunar New Year, which falls in mid-February, at a time when manufacturing traditionally slows in China. That means our throughput here at the Port of Los Angeles should be strong through at least the first week of March,” he said. 

Seroka said every part of the logistics supply chain at big ports around the world continues to be stretched. There were 15 container ships at berth at the Port of LA on Tuesday, but 23 more anchored in San Pedro Pay. Of those, 14 were bound for LA and nine for the Port of Long Beach. 

“Container dwell time on terminals remains at about five days — double what it was before the import surge during the summer. Street dwell time — waiting for warehouse or store space — is now at 6.3 days compared to 7.1 just last month, an improvement over October,” he said. 

“Anchorage remains a true concern for all of us. Many vessels are stopping first in a holding pattern before coming to berth,” Seroka continued. “In November, 50 of the 88 vessels coming to Los Angeles first went to anchor and averaged two and a half days there. So far in the month of December, about 80% of arriving vessels are going to anchor first. The wait time now is increased to four days.” 

He said the port will invest $8 million over the next 12 months in the Return Signal, geared toward rewarding faster truck turn times and dual transactions. 

Since The Signal and Return Signal were introduced in the fall, registrations for the Port Optimizer, which power them, have increased 60% and thus resulted in more visibility and fluidity of cargo, according to Seroka. “The Signal offers an aggregated three-week look at imports coming to Los Angeles. The Return Signal is for the trucking community to return empty containers, thus raising the odds of dual transactions, which are so important to our trucking community.”

He congratulated chassis pool operators and equipment providers on the opening of a yard at the port but said more needs to be done. “Any unused property is being reviewed for maneuverability and flexibility in an effort to relieve pressure on marine terminals. We have a blueprint to get chassis off the marine terminals to a neutral site near dock to open up an additional 50 to 80 acres of marine terminal space here in LA.”

Seroka reiterated that holiday-related work continues at the port despite the late date.

“It came to my attention that several toy manufacturers were having logistics issues, from manufacturing all the way down to the store shelves,” he said. “Some of these challenges were tied to operations right here at the port complex. I responded by personally reaching out to toy executives. As a result, we helped prioritize cargo. We’re also working with the toy manufacturers association and others to identify priority containers to get the gifts under the tree before Christmas.” 

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Click for more American Shipper/FreightWaves stories by Senior Editor Kim Link-Wills.

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Kim Link Wills

Senior Editor Kim Link-Wills has written about everything from agriculture as a reporter for Illinois Agri-News to zoology as editor of the Georgia Tech Alumni Magazine. Her work has garnered awards from the Council for the Advancement and Support of Education, the Georgia Institute of Technology and the Magazine Association of the Southeast. Prior to serving as managing editor of American Shipper, Kim spent more than four years with XPO Logistics.