The ports of Los Angeles and Long Beach for a second time have postponed collection of a new surcharge on long-dwelling containers, saying progress by ocean carriers and shippers has reduced the amount of aging containers on the docks by a third. Fees will not be assessed before Nov. 29, the port authorities said Monday.
The penalties of $100 per day on loaded import containers moving by truck that sit for nine or more days, and for rail-bound units sitting for six or more days, were originally set to go into effect on Nov. 15 as a way to untangle the mass of shipping units clogging the ports. The new tariffs, which escalate by $100 per day until container departure, are to be assessed on ocean carriers. Importers are upset that shipping companies are prepared to pass the cost onto them.
Citing a 26% reduction in container overstays, the port authorities last week delayed issuing the fees until Nov. 22. But more detailed statistics by the Port of Los Angeles showed containers dwelling in excess of 13 days had actually ticked up over the prior week.
Port officials had previously said the goal was to improve fluidity in the ports, where an all-time high of 86 container vessels a week ago were waiting offshore for a berth. Some shippers, they said, are using the ports as makeshift warehouses for less urgent cargo. The decision to delay the controversial storage fee was made following meetings with White House port envoy John Porcari and industry stakeholders.
Before the pandemic swelled import volumes by more than 20%, containers for local delivery typically remained on dock less than four days, while containers destined for trains dwelled less than two days.
During October, containers moving out of Los Angeles and Long Beach marine terminals by truck dwelled for 7.64 days, up from the previous record of 5.9 days the month before, according to data released Monday by the Pacific Merchant Shipping Association.
Containers leaving the terminals by rail continued to show significant improvement, with containers resting for 3.9 days compared to 5.5 days the month before.
The PMSA represents foreign vessel and marine terminal operators on the West Coast.
Nathan Strang, director of ocean trade lane management at logistics provider Flexport, said a terminal at the port complex started adding the congestion penalty to its invoice in the morning before removing it when the ports delayed the assessment. The changes didn’t delay truck transfers, but did create some holds on cargo and confusion. “If they want to push out a delay, they should announce on Friday afternoon, not Monday after we’ve dispatched” trucks, he said on Twitter.
The Southern California port complex handles 40% of all loaded imports to the U.S. and the congestion there has impacted supply chains across the country.
Click here for more American Shipper/FreightWaves stories by Eric Kulisch.
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