How’s the container ship backlog at Southern California’s ports?
How’s the container ship backlog at Southern California’s ports?
A year ago, as part of a series called “Temporarily Unavailable” about how stuff moves — or doesn’t move— around the world, “Marketplace” host Kai Ryssdal visited the Marine Exchange of Southern California.
“It’s basically air traffic control” for ships at Southern California’s ports, said Kip Louttit, the executive director.
That day last September, there were 66 container ships crowded outside the ports of Los Angeles and Long Beach — America’s busiest port complex — in addition to a couple of dozen unloading or transitioning in and out of berths.
“In a normal world, mathematically, there are supposed to be zero or one container ships at anchor,” Louttit said.
That backlog reached 109 container ships in January of last year, but more recently has dropped below 10. Meanwhile, the cost of shipping a container from China to the United States has fallen below $4,000, compared to last year’s high of around $20,000, according to data from Freightos.
To find out what’s changed (and what hasn’t), Ryssdal returned to the Marine Exchange of Southern California to speak with Louttit and other staff members.
“September of last year, just before we spoke with you, we started the discussion of the numbers increasing to a point where it was becoming unrealistic to manage traffic,” said Pat Baranic, the Marine Exchange’s general manager.
The solution they came up with in collaboration with industry stakeholders was basically holding a ship’s place in line based on the average time it takes to reach port waters while allowing ships to spread out anywhere in the Pacific Ocean while waiting.
“What we saw last winter was many were loitering down off Mexico because the weather is better down there,” Louttit said.
After implementing the new queuing system on Nov. 16, the number of vessels within 25 miles of Los Angeles and Long Beach plummeted, even as the backlog of ships waiting for a berth increased.
“In terms of what is inside 25 miles, from a safety standpoint and from the standpoint of air quality, container ships have basically returned to normal,” Louttit said. “And the remainder of the nine in the backup — outside our safety and air quality area — [are] 50 to 150 miles offshore.”
The remaining backlog of eight container ships still exceeds the zero to one that were typically waiting in pre-COVID times.
“There still are issues,” Louttit said. “But it’s much better.”
One reason for the decreasing backlog is slowing U.S. import volumes. Amid high inflation and rising interest rates, the National Retail Federation predicts imports will continue to fall over the next few months.
Onshore, container dwell times have decreased as well, suggesting that cargo is now moving more freely onto trucks and trains.
But even as Southern California’s backlog decreases, congestion has increased at other U.S. ports. The ports of New York and New Jersey, for example, just reported their busiest August ever.
“So, you know, while we say we're down to nine [container ships in the backlog],” Baranic said, “if they start to redirect those vessels back on their normal routes, is that number gonna go back up? How many are going elsewhere? We don't have that direct information.”
Click the audio player above to hear Ryssdal’s conversation with Louttit and Baranic.
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