There is no such thing as a massive ship jam in history! The connection exceeds 2,000 kilometers
The United States is undoubtedly facing an unprecedented shipping crisis. Recently, congestion at the Port of Los Angeles and Long Beach in Southern California, the busiest ports in the United States, has intensified. The latest data from the “Southern California Maritime Exchange” shows that as of last week, there were as many as 97 container ships waiting to enter the port outside the above two ports. It is unprecedented in history.
Some organizations estimate that if all the containers loaded on waiting ships were connected end to end, the total length would reach about 2,200 kilometers, which is equivalent to half the distance from the east coast to the west coast of the United States.
So, what are the impacts of congestion on this scale? How long will it probably last?
The Port of Los Angeles and the Port of Long Beach, located in Southern California, are gateway ports connecting shipping routes between Asia and the United States. Last year, the ports of Los Angeles and Long Beach handled a total of 8.8 million import containers, accounting for 40% of the total annual import containers in the United States.
However, due to factors such as the imbalance between supply and demand in the global shipping industry and weak port operating capabilities, congestion at Southern California ports continues and worsens. Currently, the two ports have a backlog of 97 cargo ships, twice that of the same period in August; the average entry time has been extended from 6.2 days in mid-August to the current 8.7 days.
Yan Ci, President of Maersk (China) Co., Ltd.: The tension in the maritime supply chain is not only reflected in the ports, but also related to land transportation. For example, there is insufficient rail capacity from the port to the inland and insufficient freight trucks.
Taken together, the global shipping and logistics market will remain tense at least until the end of this year.
Freight rates soared by more than 300%
The latest data from the “Drewry World Container Index” on the 23rd showed that from Shanghai to The freight for shipping a 40-foot standard container in Los Angeles is US$10,377, which is approximately RMB 67,000, an increase of 329% over the same period last year.
Industry insiders pointed out that the recent surge in “spot freight rates” does not reflect the overall picture of the global shipping industry. “Long-term contract freight rates”, which account for a larger proportion of orders in the shipping industry, fluctuate little and have less impact on the downstream supply chain.
Maersk’s latest quarterly report shows that the average freight rate for each 40-foot container on its east-west route in the second quarter of this year was US$3,148, a year-on-year increase of 67.5%. The freight level and increase were significantly lower than the spot freight rate. .
However, the surge in spot freight will still cause price increase pressure.
As the autumn and winter shopping seasons approach, a large number of merchants in the United States have begun to place orders and stock up in advance, putting further pressure on the freight routes from Asia to the United States. Due to rising freight costs, some U.S. retailers are planning to raise prices, which will increase the cost for U.S. consumers during the holidays at the end of this year.
The Port of Long Beach operates 24 hours a day, but the Port of Los Angeles refuses
With the encouragement of the Biden administration, the Port of Long Beach in the United States has decided to operate it from Monday to Thursday. It operates 24 hours a day (previously 16 hours a day). Mario Cordero, executive director of the Port of Long Beach, said he supports the plan for 24-hour operations because congestion is getting worse this year.
Cordero said in a statement that the Port of Long Beach is taking “bold and swift action to help the supply chain” and anticipates that it may eventually expand 24-hour operations to seven days a week.
“Given current cargo volumes, every link in the supply chain needs to maximize operating hours. The Port of Long Beach is moving toward an all-weather supply chain, and the goal of our pilot program is to keep the gates open all night while bringing warehouses and Trucking companies are operating overnight,” Hacegaba noted.
However, in stark contrast to the Port of Long Beach’s active response to the U.S. government’s call and its 24-hour operation, its The nearby Port of Los Angeles still has no specific plans to extend its opening hours, but has emphasized that it will focus on improving operational efficiency to cope with the surge in imports at the important trade gateway of the United States.
Gene Seroka, executive director of the Port of Los Angeles, said there are loopholes in the system that connects incoming and outgoing containers to trucks serving inland distribution points. Although dozens of container ships are currently waiting for berths at sea and port terminals handle record numbers of inbound containers, an average of 30% of cargo booking slots are still underused each day.
“If these loopholes are still not enough to be resolved, we will consider extending the working hours,” Seroka said, “but first I want to deal with the things that are not going well in our current work.”
p>
Seroka also added, “Ports can only truly extend operating hours if trucking, warehousing and other industries also move towards 24-hour operations. You can’t hire workers, open the port gates, and tell everyone You can open your business, but no one comes…”</p
