Only 8 ships waiting off Southern California — but 41 off Savannah

Date: Wednesday, August 31, 2022
Source: American Shipper

And then there were eight. That’s the number of container ships waiting for berths at the ports of Los Angeles and Long Beach on Monday, the lowest tally since the early stages of consumers’ COVID-era buying spree. The epic container ship traffic jam that was once a highly visible symbol of the supply chain crisis has now almost vanished.

It’s a different story for North America as a whole, however. The number of container vessels waiting offshore of all ports has remained roughly steady at an extremely elevated level throughout this month, at around 130 ships.

LA/LB: Relief offshore, still strained onshore

“The last day we had eight container ships [waiting off Los Angeles/Long Beach] was Nov. 15, 2020, in the early days of the backup,” said Kip Louttit, executive director of the Marine Exchange of Southern California.

The norm before the pandemic was for no ships, or at most one, to be waiting. The queue first began to climb in October 2020.

chart of container ships off Los Angeles Long Beach
(Chart: American Shipper based on data from Marine Exchange of Southern California)

The number of ships off Los Angeles and Long Beach hit an all-time high of 109 on Jan. 9. At this time last year, there were 48 container vessels waiting offshore, almost six times more than there are now.

chart of container ships off ports of Los Angles and Long Beach
(Chart: American Shipper based on data from Marine Exchange of Southern California)

Although conditions off the shores of Southern California are approaching pre-COVID normality, conditions at the terminals are not. Landside conditions are improved versus the peak, but the numbers are still unusually high.

As of Monday, there were 50,176 empty containers at the Port of Los Angeles. That’s well below a short-lived spike to 90,397 in late November, but it’s same number of empties as in late February.

There were 66,467 loaded import containers at the port’s terminals, down from June and late October 2021 but still on par with levels in late November. Of the total, 31,150 were waiting to load on railcars. Normally, there would be around 9,000. There were 20,710 rail-bound containers that had been waiting nine or more days. Normally, none would dwell that long.

At the Port of Long Beach, there were still 14,877 containers dwelling nine days or more as of Monday. That’s well below highs seen in July and October 2021 but still above levels recorded in the first quarter.

Persistent shift to East and Gulf coasts

The unwinding of the queue in Los Angeles/Long Beach appears partly driven by easing import demand and partly by a shift in volumes to East and Gulf coast ports. That shift is believed to be driven by shipper concerns over peak season congestion in Southern California and the expiring West Coast port labor contract.

“Some of them are looking foolish for having hit the panic button too early,” a freight forwarder told Platts this week.

As a result of the coastal shift, shippers are paying higher rates for transport that’s taking longer than scheduled due to port queues.

The Freightos Baltic Daily Index for China-West Coast spot cargo has fallen 29% over the past two months. The China-East Coast spot index has dropped only 10%.

chart of container ship spot rates
Blue line: change in China-West Coast spot rates over past two months; green line: change in China-East Coast spot rates (Chart: FreightWaves SONAR)

American Shipper periodically surveys the number of container vessels waiting off all North American ports, using ship-position data from MarineTraffic and official queue lists from California ports.

When the Los Angeles/Long Beach queue peaked in January, the North American total was around 150. As waiting ships in Southern California declined, the North American total fell to around 90 in June.

But when volumes moved away from the West Coast, queues started to grow on the East and Gulf coasts. That pushed the North American total back up past 130 in mid-July. The total peaked at just over 150 ships later that month. In August, the total has pulled back to around 130 and stayed fairly steady.

As of Tuesday morning, there were still 130 vessels waiting: 41 off Savannah; 24 off Houston; 19 off New York/New Jersey; 14 off Vancouver, British Columbia; 13 off Oakland, California; eight off Los Angeles/Long Beach; seven off Virginia; and four off other ports. West Coast ports accounted for only 27% of the total.

Container ships waiting off Savannah (left) and Houston (right) on Tuesday morning (Maps: MarineTraffic)

[Read from the original source.]