Halloween is going to be an extra scary day for the logistics world. A total of 60,000 containers have been marked as beyond the dwell time and need to be moved out of the ports of Los Angeles and Long Beach by the carriers or the penalties will start racking up. A total of 33,000 containers need to be rolled out of the Port of Los Angeles and 27,000 loaded containers for the Port of Long Beach — a whopping $2,633,940,000 value in trade.
Carriers were put on notice this week when the ports announced that, starting next Monday, a daily surcharge of $100 per container will be levied. Did this light a fire and a surge of containers being moved? No.
The pace of trade moving out of the ports could be characterized as more of a pregnant pause than a surge. Live webcams of the Port of Los Angeles terminals show more images of empty lanes than robust activity.
Turn times at both terminals tracked by the Harbor Trucking Association and GeoStamp also paint the snail pace of trade both before and after the announcement.
“We are having an emergency harbor meeting Friday morning to vote on this,” explained Port of Los Angeles Executive Director Gene Seroka. “I need to see progress on the movement of loaded containers. We need to show America we are doing whatever we can to get trade moving.”
Noel Hacegaba, COO of the Port of Long Beach, emphasized this container push would be significant in alleviating the congestion plaguing productivity.
“This is roughly 40% of all containers sitting on the terminals today,” he said. “Pulling all of these containers by Sunday will take an unprecedented coordinated effort but it must be done.”
RELATED: Ocean carriers will pass on fines for lingering containers to importers
Importers have told American Shipper they are afraid they will be on the hook for the fees. Some have already received letters notifying them of the additional charges.
“The carriers have always passed on fees and surcharges,” said one importer who asked for anonymity out of fear of retaliation. “Why would the Biden administration, which is behind this penalty, think the carriers would not pass it over? The Federal Maritime Commission is already looking into the excessive demurrage costs we are paying! Carriers are making record profits.”
Maersk sent a letter to customers on Wednesday detailing the penalties.
When asked if the penalties would be passed over to customers, Maersk responded it was a work in progress since it has clients that have clauses in their contracts that stipulate no new additional charges.
“This penalty was not intended to be a passed-on cost,” explained Mario Cordero, Port of Long Beach executive director, at a port update press conference.
Hacegaba added, “We are using every tool at our disposal to move containers.”
The National Retail Federation and the American Apparel and Footwear Association tell American Shipper if these charges are passed on, it will only add to the mounting inflationary logistic charges importers have been paying.
Hacegaba stressed, “We need the entire supply chain to step up.”
Craig
Another big problem is the amount of worthless junk people keep buying,that are not necessities…. because of influence…When people wake up and stop buying so much crap… Buy American made,(…. That will not get stuck on a ship) pay your bills,feed your family..and prepare for the future!…
Chris FitzGibbon
I think the real problem is U.S. Customs. They can’t clear the freight fast enough and it jams up the whole process.
Shagi
We wouldn’t have this issue if California didn’t make so many laws that hurt the trucking industry.
Rod
The people who work at the ports called ‘longshoreman’ to do their job efficiently, 90 % of the workers just ARE MILKING THE COW it takes 3 to 6 hours to get a load out of the ports
Reginald Williams
That’s a lie and I don’t care who agrees or disagree I’m a longshoreman for 41 plus years here at port Everglades we work our ass off,you guys come into the port like you own it,some even trying to skip the other and yes if you disrespected one of us we will make your ass wait but for the most part we are hard working people.and we know our jobs.
Jessica
why not interview the port truck dispatcher we’ll tell you what’s one of the MAJOR problems at the port .
Container Chassis is one of the problems :
-There are NO chassis at the ports
-Getting to the port at 5am to be one of the first to get in hoping there are chassis
-1 to 4 hours waiting for a chassis
-Long line to get a chassis but there’s no control some drivers run around the port looking , asking other drivers if there dropping it even trying to steal one from there shop
-Sometimes the port will kick you out or not let you in because there are no chassis
-There are some brands of chassis we can NOT use ( ZIM , TRAC , WCCP and more )
-Port don’t have room for empties coming in so we can not do a double transaction ( empty and load out )
-pier S is helping out by dropping empties there but it’s not enough
-Renting and Leasing companies don’t have chassis to rent out
-There’s no shortage of drivers there’s shortage of equipment to take out loads
Sales rep
Jessica, do you think the ELD’s and changes to the hours of service rules, the AB 5 law, and CARB 21 rules are also a factor? It seems to me every time the government tries to fix something they make it worse. I know that the shortage of equipment (good road worthy equipment) has been a problem for the last 35 years I have been in the industry, but I really never worked the harbor because the drivers were always treated so poorly.
Daniel
Thanks CARB law has a huge effect. Allot of us owners will not go into Cali because of this law. There might be more chassis in other states but you do not have enough CARB trucks to take them back. Also the unions at the ports need to help by working more and harder Tom help reduce wait times at the ports.
Ops Manager
Looks like Buttigieg is back from Paternity leave.
Port user
Let’s go Brandon!!
Kurt Ross
When leadership has no clue what’s going on you get this!
Jessica
There is no way. Where are they going to get the chassis to move them?