How Empty Cans Are Exacerbating Stress on US Supply Chains

A chronic shortage of truck drivers is crippling America’s supply chains, making it difficult for businesses to secure the products they need. But when Matt Schrap visited a truck yard near two California seaports, Los Angeles and Long Beach recently, he found 20 trucks idle.

Footage points to another factor in the country’s delivery problem: empty shipping containers. As they sit at ports waiting to be returned to exporters, many are taking up space on chassis – the specialized trailers that drivers need to receive the full range of containers arriving from Asia.

“It really adds strength to the structures,” said Schrap, head of the Association of Port Transporters. “Because we couldn’t pick up these chassis, we actually sent the people home.”

Empty containers have become a priority for port operators, shipping lines and the Biden administration as they work to fix the supply chain. lengthen by increased consumer demand.

Gene Seroka, chief executive officer of the Port of Los Angeles, said that this week, 65,000 empty containers have arrived at their port, up from 55,000 a few weeks ago. Data from the three major chassis system operators shows that 90% of all chassis in ports are currently in use, up from 75% in January.

At the same time, the number of container ships moored outside the ports of Los Angeles and Long Beach, lined up for unloading, hit a new record of 86 this week.

The situation arose earlier this year, when containers were stranded in the central part of the country because some truckers were reluctant to carry empty containers back to the coast. According to supply chain experts, it is possible to make more money with full shipping.

In response, shipping conglomerates began keeping containers near docks, exacerbating pile-ups around ports, industry executives said.

Caitlin Murphy, chief executive officer of Global Gateway Logistics, a Missouri-based freight forwarding company, said she’s been having trouble since May moving goods inland by train from Los Angeles and Long Beach.

“Normally, loaded containers should be moved by rail to inland points; they don’t do that anymore,” she said, because the shipping groups that own or rent the boxes “want those containers available to go back to Asia”.

She urged the Biden administration to focus more on the smooth running of rail service, rather than focusing largely on seaports. “The severing of the tracks has blocked the supply chain,” she said.

Keith Winter, chief executive officer of Crane Worldwide Logistics, another freight forwarding company, echoed her concerns, saying ocean carriers have become more cautious about providing room for shipping. goods by rail, limiting the usual flow of containers to inland hubs.

Michael Farlekas, chief executive officer of E2open, the company that makes ocean freight booking software, said the shortage of containers in the US interior has affected exporters, who often stack empty boxes. to the international market.

More than 80% of containers exported from the Port of Los Angeles in September were empty, New York Times report recently, up from about 2/3 in September 2020 and September 2019.

Lisa Ellram, a professor of supply chain management at the University of Miami, said the US used to have more uses for “empty” containers, until the export of recyclable materials to China. stopped in 2018. She added: “This has helped the flow back to China, because the US imports more than it exports.

But “chaotic” at the ports – where there are tens of thousands of importers, thousands of truck drivers, nearly 20 different people terminal operator and some centralized controls – are part of the problem, she added.

Southern California port operators have been trying to prevent rallying areas where containers have piled up, announcing in late October that they would impose a surcharge on containers left too long on their premises, with fine up to 100 USD/container a day.

Although the surcharges won’t take effect until Monday, Seroka said this week, the number of containers subject to it has dropped by about 29% since then.

Ocean carriers, he added, have arranged for six “sweepers” to pick up about 17,500 20-foot-equivalent empty containers, and two more are on their way. Pete Buttigieg, Biden’s transportation secretary, praised their arrival on Twitter, but Schrap and others say more will be needed to clear the backlog.

Schrap says the biggest challenge for truckers is a more bureaucratic one: without an appointment to return an empty container, drivers can’t be idle to pick up a full container. But berth operators inside the port complex will not accept empty containers without knowing that a vessel will arrive to unload them.

The Port of Los Angeles is working to provide incentives for truckers to carry an empty container every time they pick up a new load, Ellram said. “They have to make it worth their time to bear the extra delay,” she said.

If it’s not fixed quickly, Schrap worries that motorists who make a living transporting goods in and out of ports will find other work. “It’s ridiculous,” he warned: “If they don’t have a job here, they’re in high demand. What’s stopping them from going and looking for another driving job? “

Source link


News7h: Update the world's latest breaking news online of the day, breaking news, politics, society today, international mainstream news .Updated news 24/7: Entertainment, the World everyday world. Hot news, images, video clips that are updated quickly and reliably

Related Articles

Back to top button