LA/Long Beach delay port congestion fees again

Date: Tuesday, December 7, 2021
Source: Freightwaves

Port officials in Los Angeles and Long Beach have delayed imposing controversial congestion fees for a fourth consecutive week, increasing the likelihood that the fees will never be assessed.

The port authorities said the excess storage surcharge has been postponed until Dec. 13.

The fees have had their intended effect of getting users to clear long-stored containers from terminals, according to port officials. Containers that dwell more than nine days for local truck drayage and more than six days for rail moves are liable for a $100 per day surcharge, increasing by $100 per day. Overstays of those durations previously accounted for about 40% of all containers on the terminals.

The surcharges, approved by the respective port boards in late October, were originally scheduled to go into effect on Nov. 15, and be paid by ocean carriers.

Ocean carriers have little control over the discharge of most cargo they deliver, leading to criticism that carriers were improperly targeted and concerns that carriers would try to pass the fees on to importers.

The  sister ports said they have seen a combined decline of 37% in long-dwelling cargo on the docks. At the Port of Long Beach, excess container storage is down 25% using the baseline of Oct. 28 and down 34% since Nov. 1, Noel Hacegaba, the deputy executive director said during a special board meeting on Monday. The port authorities will reassess fee implementation after another week of monitoring data.

Progress has plateaued, however, since an early reduction in the number of long-staying containers, mostly due to ocean carriers bringing in extra vessels to load out empty containers. Officials say the threat of the fees has changed industry behavior of using the ports as overflow storage, reducing the need to go forward with implementation for the time being.

[Read from the original source.]