09/29/2020

Southern California Port Congestion Worsens; Experts Weigh in on Addressing the Gridlocked Ports and Chassis Shortage

Aaron Brown

Peak season has arrived and as the number of imports increases, the Los Angeles / Long Beach Port Complex continues to experience the worst congestion it’s seen in years. The biggest challenges presented to shippers in Southern California are the shortage of import pickup appointments, empty container return appointments, and chassis. These factors combined result in longer dwell time for containers on-dock and off-dock, and further increasing supply chain congestion. Drayage providers are experiencing a degradation in productivity, while shippers are experiencing costly demurrage and per diem. The port environment right now is intensifying the demand for drayage capacity support, which is requiring peak season surcharges in many cases and driving up spot pricing.

Mitigating the Impact for Customers

NFI Cal Cartage continues to work diligently with customers in combating challenges that have arisen as a result of Southern California port congestion. While pool chassis providers have exhausted their inventories, NFI Cal Cartage has made significant investments in our private chassis fleet. The company has also invested in additional yard parking capacity, where available, and will continue to expand these assets as we continue to move through peak season. In addition to increasing its pool of chassis and yard parking capacity, NFI Cal Cartage is also increasing truck capacity through aggressive recruiting with productivity incentives.

Identifying Industry Solutions

Industry stakeholders are actively working together to collaborate and identify solutions for congestion at the ports and the delays at distribution centers that follow as a result. A few terminals have made concessions to allow empty containers to return when there is an existing import appointment to support more dual transactions, however, all 11 marine terminals must make these same concessions in order to help improve the current state. Rest assured that NFI Cal Cartage leadership is pushing for continuous improvement in the port complex and will always advocate on our client’s behalf to drive productivity initiatives.

NFI Cal Cartage is encouraged by The Port of Los Angeles’ recent announcement of the release of “The Signal,” a new data tool that enables the use of forward-looking information to better plan and prepare for inbound cargo with the goal of reducing congestion at the ports. Updated on a weekly basis, the data-driven technology offers supply chain stakeholders a dashboard view of how many shipments will be arriving in Los Angeles over the next three weeks. The data is broken down by container type and includes details on the mode of transportation, whether rail or truck, once it arrives in Los Angeles.

NFI Cal Cartage continues to work closely with customers and terminals on identifying the best path in navigating the current challenges. We view our role as critical in helping shippers remain educated about the Southern California port operations, and make a point to provide front-line visibility for all supply chain stakeholders. To stay up-to-date on the state of the Los Angeles and Long Beach Port Complex and other industry news, subscribe to NFI Cal Cartage’s monthly port drayage news emails here.