USA Congestion extends beyond the ports
The constant line of ships waiting outside of US ports has put excessive pressure on all landside operations related with moving inbound and export cargo from the vessels, to the yards, to railheads, and destination warehouses. Everything is exacerbated by supply shortages: from chassis, gensets, to labor at each point of a logistics move to a warehouse door.
This is also not just a US West Coast port problem, the street dwell time for chassis equipment in New York / New Jersey is currently at 15-17 days on average according to the Journal of Commerce. The Association of Bi-State Motor Carriers confirms that chassis availability is now the major pain point slowing down import collection at these ports.
With critical delays and shortages, it is extremely difficult to pull import cargo out of terminals before free time limits expire and return empties when terminals are at or over capacity. Likewise it is hard to collect empty units and chassis, load at facilities, and deliver loaded export cargo to the port within vessel receiving windows.
When free time expires, demurrage (charged by shipping line after free time window expires), terminal storage (charged by the terminal) and detention (charged when containers are not returned to terminals within the allotted free time) charges and penalties are all skyrocketing.
The US Federal Maritime Commission (FMC) is investigating carrier detention and demurrage practices as well as increasing reporting requirements for carriers to assess anti-competitive behavior. Not this will not focus on shipping rates or market level pricing. More information available at www.fmc.gov
For a snapshot of congestion by US port (vessel berthing and terminal yards) and intermodal conditions jump to the US Port & Intermodal update report here.
Europe to North America
There is strong demand on this shipping lane and vessels are overbooked. The backlogs will continue as there is no major increase of shipping capacity from carriers. Ocean rate increases take effect October 1st to all USA ports as previously announced here.
North America to Europe
There is availability for select cargo types moving from Atlantic and Gulf ports, but there is no capacity for the cargo demand from US West Coast and rates for those moves continue to increase. Transshipment services are adding additional delays for services that combine European and Latin American cargo.
Oceania / New Zealand
Service loops from Australia and New Zealand to the US West Coast continue to be disrupted by port delays both at origin and at destination. Sailings from New Zealand to the USA will skip Oakland every other vessel through the end of November. The fortnightly service from Adelaide to the Oakland has been reinstated but vessels stop at Papeete which restricts the loading capacity on these vessels.
Container supply is disrupted, especially for equipment for flexitanks. For moving smaller quantities, inquire for groupage container service with Hillebrand or consider airfreight options for urgent orders.
Note that the Maritime Union of Australia (MUA) representing Australian dockworkers has announced a new series of strike action and slowdowns against Patrick Terminals (which operates terminals in Melbourne, Sydney and Fremantle). The terminal operator handles about 40 percent of Australia’s container throughput and has already been impacted by labor outbreaks and staff mandatory quarantines. We will continue to update as this situation develops.
San Antonio port terminals have also experienced higher than usual closures from severe weather this season (high winds and surf conditions). Vessels have omitted port calls if they cannot berth and when vessels can operate the loading capacity is restricted. This is especially disruptive to vessel schedules for cargo destined to US East Coast / Gulf ports because the vessels also have to wait for Panama Canal crossing scheduled slots as well.
Freight moving from Argentina to Chilean ports have additional seasonal delays from winter closures on the cross-Andes corridor, so prepare for even longer transit times.
Equipment is in short supply in particular in the Cape Town region where there was a spike in demand for fruit exports ahead of new EU legislation going into effect mid October. Ocean services are still delayed an average of 4-5 days as vessels have omitted Cape Town and Durban port calls to improve schedule reliability. There is still a backlog at container terminals and the supply chain from earlier port terminal shutdowns.
Asia / Transpacific – Golden Week Blank Sailings October 1-7
In addition to the longstanding port and landside congestion at US West Coast, congestion is building at major Chinese ports with over 100 container ships queuing up outside of Shanghai and Ningbo ports. Typhoon Chanthu closures earlier this month also contributed to the backlog along with the export rush before Golden Week. Ocean carriers have confirmed skipped sailings for this week and next week.
For more information on pending or planned shipments, please reach out to your Hillebrand representative to discuss the best possible arrangements for transport, warehousing, insurance, and customs compliance needs.