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Port Delays…What causes them?

Mar 11, 2015

Shipment delays caused by the state of the ports can be frustrating. If you are wondering what causes these delays you are not alone. The first answer that comes to mind is contract negotiations and the related labor dispute. Unfortunately that is only part of the picture. The rest of the causes are even more complicated than that and may not be resolved for a while.

Port congestion (738x453).jpg

So what exactly are the causes of the port delays that hold up your shipments for weeks at a time? The following are included:

  • Contract negotiations/Labor dispute — A tentative agreement has been reached in the labor dispute on the west coast. The negotiations that went on for close to nine months created a substantial backup of ships waiting to come to the ports and unload. This was partly caused by issues between the union workers and the employers. Some claimed that the dock workers were working slower than normal. Some claimed that the employers hadn’t trained enough crane operators to move shipping containers so they could be taken out of the port. Fortunately work is now back to normal and should remain steady assuming that the agreement is approved by all union members and individual employers.
  • Truck trailer (chassis) shortage – Shipping companies used to own and maintain the trailer chassis. They sold them to leasing companies and now truckers need to get the trailer from the correct leasing company before picking up a given container. One cause of the shortage, in general, is that the chassis are being taken out of service because they are in disrepair.
  • Increased use of mammoth container vessels – The ships that are used to transport containers today often carry more than 14,000 containers where a ship that carried 8,000 to 10,000 of the same steel boxes was considered a large ship just 2 years ago.
  • Aging port terminals – These port terminals were sized, in some cases, decades ago for ships a quarter or a third of the size of those used today. With so many more containers coming in at once the ports and dockworkers are challenged to find a place to put it all. Containers that once were stacked three high now get stacked five or six high. That means the container boxes on the bottom and middle of the stack are more difficult and slow to extract when the owner sends a truck for them.
  • Cargo from multiple shipping lines on one ship – Making matters worse, the larger ships now carry cargo from multiple shipping lines, and the containers often aren’t even sorted in a way that they can be swiftly moved out of port.
  • A shortage of truck drivers -- Delays in retrieving containers are part of the reason port truckers who once were able to drive three loads per day to local warehouses are getting just one load a day or none. It’s not unusual for a trucker to wait eight to ten hours to retrieve a container from the ports. Since they only get paid for the loads they haul their incomes have shrunk in the last year or so. As a result many have to work other jobs to get by. Since it is not as profitable to drive trucks some have simply changed careers entirely. This also makes it more difficult for trucking companies to attract new drivers.
  • A shortage of rail car capacity to haul cargo away from the docks.

 

Although this paints a somewhat bleak picture there are solutions that are being created and implemented. In my next post solutions will be discussed.

 

For assistance with shipments through ports and to understand your options contact your American Group representative or simply call 866-553-6608.