The sustained surge of U.S. containerized imports from Asia, which began eight months ago, continues unabated and is anticipated to persist well into the spring, being further exacerbated by the pre-Lunar New Year cargo rush experienced at origin ports in Asia in recent weeks. The situation in Yantian port in South China is a prime example of the current challenging ocean market situation. Factories in South China are rushing to deliver goods before the holiday, and this coupled with the backflow effect of port congestion in European and American ports, has significantly and negatively affected the official operation time of vessels calling at Yantian. The detention period of full containers at the terminal has been extended from 3-5 days to nearly 10 days. Yantian terminal has reached the limit of stacking full containers. According to the latest information received from Yantian Port, there are nearly 300,000 TEUs of full containers sitting on the terminal, a record high. Yantian port management has stated that the serious congestion issue is expected to be alleviated over the next 2 weeks, but the current situation is yet another symptom of the pandemic’s impact on global supply chains.
At U.S. ports, Los Angeles/Long Beach continues to be hardest hit, experiencing consistent vessel backlogs and congestion. According to the Port of Los Angeles Signal Port Optimizer, imports volumes for week 7 were at 173,622 TEU, a 130% increase year over year and week 8 is projected at 139,401 TEU, a 224% increase year over year. There are currently 18 container vessels at anchor awaiting berth and the current time at anchor is 8.0 days. There are another 15 vessels due at anchor in the next 4 days. Terminal operators in Los Angeles/Long Beach have advised that container volumes will remain much stronger than in past years this spring, and that the ports will contend with congestion well into the second quarter.
In reaction to the prolonged congestion, the ocean carriers have reacted by launching some new services skirting LA/LB which will provide shippers with more options and allow the ports of LA/LB to manage through the current backlogs.
- CMA-CGM launched its Golden Gate Bridge service with a rotation of Yantian, Oakland, Seattle, Shanghai, and Yantian.
- Mediterranean Shipping Co. in December started its Chinook service with a rotation of Yantian, Shanghai, Busan, Vancouver, and Yantian.
- ZIM Integrated Shipping Services will launch a service beginning Feb 21, that will call in Southeast Asia, Los Angeles, Tacoma, and Vladivostok, Russia, before returning to Laem Chabang, Thailand.
- Wan Hai Lines in mid-March will double its current two trans-Pacific strings to four, which includes a new Pacific Northwest service from North Asia to Seattle and Oakland that will not call in Southern California.
One final piece of good news is that one of Noatum Logistics’ key core ocean carriers, CMA-CGM, is pending delivery of 100,000 new containers into their system between March – May. Things will not improve overnight, but this will help with the equipment shortages that have been experienced.
Noatum Logistics is working diligently on limiting these impacts for our customers. If you have any questions, please reach out to your Noatum Logistics representative.