LA & LB: Anchored 25 | Terminal 28
Oakland: Anchored 6 | Terminal 8 | Coastal 7
NWSA: Anchored 10 | Terminal n/a | Coastal 2
Vessel Congestion Update
This week, the San Pedro Bay has seen an increased number of Container Vessels waiting in anchorage. As of Monday, 20 container ships alone were in anchorage. Why has the port complex returned to double digits after reducing anchorage numbers to single digits? The port of Yantian and other ports in Guangdong Province in Southern China have been catching up as they worked to relieve the congestion that was created by the COVID-19 outbreak. Yantian is now ramping back up to normal export levels. Local port officials indicate the lull/break for the ports of LA and LB is over, as they have been working in a catch-up mode while the Southern Chinese ports had reduced production. Cargo volume is anticipated to continue with the traditional July-August peak season congestion expected into 2022.
The Marine Exchange of Southern California reported anchorage and terminal number of container vessels rose to 49 this week. The increase of container vessels is expected to continue, according to Marine Traffic, who stated, “a caravan of at least 3 dozen container ships is currently en route from China to the US.” Bookings to the U.S. from China remain high for mid-July and port officials forecast a high volume of import cargo for August 2021.
Currently, reports suggest that retail inventory-to-sales ratios remain at a near all-time low (excluding vehicles and auto parts). Consumer spending is anticipated to continue as demands for school supplies and back-to-school wearing apparel increase. A slight offset is ongoing, as consumers have switched spending to the restaurant and service industries. Gene Seroka, LA Port Executive Director, indicated during a Propeller Club of LA presentation held this month: “July and August look super-strong and all signs point to a busy second half of 2021, as the traditional peak season will ramp up indicating a strong July and August.”
Ship Traffic Congestion in Vietnam:
Southern Vietnam was placed in lockdown as of Sunday, July 18, 2021. Ships have backed up as COVID-19 has hit, creating havoc on Asian supply chains and most terminals are severely congested. Off the coast of Vung Tau (an important feeder and transshipment hub) many ships are at anchor waiting for berth space. In recent weeks, factories have been forced to close due to the lockdown.
TMF (Pierpass Fee) at Ports Of LA/LB To Increase On 8/1/21
The West Coast MTO Agreement (WCMTOA) announced that on August 1, 2021, the Traffic Mitigation Fee (TMF) also known as the Pier Pass Fee at the ports of Los Angeles and Long Beach will increase by 2.2%. The TMF helps offset the cost of operating extended gate hours. Labor costs are the largest single component of extended gate costs.
Rail Operators Restrict Import Rail Traffic – Ports of LA-LB
As of Sunday, July 18, 2021, and for the following two weeks, Burlington Northern Santa Fe Railway (BNSF) has reduced U.S. import rail traffic movement. Both ports of Los Angeles and Long Beach will be affected and it will impact the delivery of onboard or discharged cargo to Chicago. The cargo will be held at the marine terminals until the restriction is abated. As a result, any change of destination may prove difficult given the challenging circumstances of record import volumes into the U.S. which has extended the impact on the U.S. intermodal supply chain.
On the East Coast, if the intermodal supply chain does not improve, the temporary measure may spread to include cargo moving from New York to Chicago, Cleveland, and Indianapolis.
Please contact your Western Overseas representative if you have any questions.