Forwarder sees no let-up, as volumes remain ‘continuously high and will continue to be high for the weeks to come’, with little opportunity to clear backlogs during CNY. Congestion at the ports of Los Angeles and Long Beach has reached critical levels and there appears to be no end in sight, with the situation further compounded in recent days by a serious outbreak of coronavirus among dockworkers at the US west coast gateways, a senior freight forwarding executive has warned.
US forwarder Flexport’s VP for Ocean Freight, Nerijus Poskus, told a webinar this week: “It’s quite tough out there at the ports. A few days ago, there were 112 ships waiting at Los Angeles and Long Beach and of this number 33 were waiting for a berth. Storm conditions recently have also added to the problems, affecting schedules.”
As to why the congestion is happening, he pointed to the surge in (import) volumes which were up by almost 50% in the second half of 2020 year over year.
“Last week, basically almost 300,000 TEU were waiting to be offloaded. That’s a lot of cargo. A second factor (in the congestion) is that you need staff and infrastructure to offload everything. The LA and Long Beach ports have a lot of coronavirus cases.
“Last week alone, there were something like 700 amongst 9,000 ILW staff – a very high percentage of COVID infections. So, the port can’t serve the ships fast enough which has led to waiting times increasing to 10-14 days, in some cases longer, depending on the terminals. So, port executives, union leaders and elected officials initiated a vaccine campaign for dockworkers, fearing that the terminals may even have to be shut down if conditions (with the COVID crisis) get worse.”
He continued: “Thirdly, typically at this time of the year, you’d have more blank sailings through Chinese New Year (meaning fewer vessels to be handled at the ports). Last year, there were 88 blank sailings. Two years ago, it was 65-67 blank sailings. This year, it is seven on Asia-Europe trade and five on the Transpacific.
“It’s not only that the volumes are high but that they are continuously high and they will continue to be high for the weeks to come – and the port will not have time to clear up the mess post-CNY.”
Poskus noted that there was much less congestion at the port of Rotterdam. “This is because the ships calling there, specifically on Asia-Europe routes, are much larger (than on the transpacific) and of 20,000 TEU (capacity) or so. Secondly, the port of Rotterdam is much more automated and the impact of coronavirus cases (on dockworkers) is not as great.
Commenting on the significance of increased waiting times for vessels at LA and Long Beach Lars Jensen, CEO of Sea Intelligence Consulting, noted: “This is the equivalent of pulling five full transpacific services permanently out of action. The impact is massive.”
Schedule recovery cancellations
As reported today in Lloyd’s Loading List, major global container lines are being forced to cancel significant numbers of east-west services due to exceptionally long delays to vessels caused by congestion in Asian and North American ports.
Reflecting the reality faced by box lines around the world, Hapag-Lloyd told customers this week that it was being forced to implement “a comprehensive schedule recovery plan to get vessels back in their intended positions”. The German line, the world’s fifth largest, said this “will result in some services not having a sailing for one to two weeks”, although the carrier stressed that this was in no way an indication that it was wanting to reduce capacity.
“It is important to emphasize that vessels will not be idling at any time and we will perform as many voyages as possible,” the line stressed. Although the disruptions are not exclusively caused by delays to Asia-US services, that trade was highlighted as the main cause.
“The Transpacific Trade is currently going through unprecedented times,” the line explained. “The vessels, port infrastructure and inland logistics supporting the cargo movements are stretched beyond their capacity and have been so for several months. As a result, ships are waiting in line significantly longer than normal both in Asian and North American ports, leading to vessels being days and in many cases weeks behind their normally scheduled dates of call.
“We have in past years been able to react to such situations by adding recovery vessels to cover these open positions to ensure that we continued to offer a weekly service; however, as our fleets are fully deployed and stretched beyond capacity, this is regretfully currently not an option.
Source: lloyd´s
