California congestion nears new high, East Coast gridlock worsens
Port congestion on both coasts is likely to cap second-half US import capacity
- Freightwaves.com GregMiller, Senior Editor
It’s only mid-August — the early days of peak shipping season — but the record for container ships anchored off California is already on the verge of being broken.
Port congestion is simultaneously building along the East Coast, with anchorage numbers off Georgia well into the double digits and, for the first time this year, a growing queue offshore of the Port of New York and New Jersey.
Southern California congestion soars
California congestion previously peaked in the first quarter. On Feb. 1, the Marine Exchange of Southern California reported an all-time-high 40 container ships at anchor in San Pedro Bay, awaiting berths in Los Angeles or Long Beach. The highest number of container ships in the entire port complex, including those at anchor and at berth — 67 — was set on Jan. 28.
On Friday, there were 125 ships of all types (including tankers and cruise ships) either at berth or anchor in Los Angeles/Long Beach. That’s a new record. The Q1 high was 113.
On Saturday, there were 68 ships of all types at anchor, yet another record. There were 66 container ships either at berth or waiting offshore, just one short of the all-time high. And there were 37 container ships waiting offshore, three short of the February peak.
All regular and emergency anchorages were full, forcing the overflow to drift in designated areas. As of Sunday, five container ships were drifting off Santa Catalina Island.
After surging in the first quarter, congestion was capped by vessel supply. The more ships stuck at anchor, the fewer available to pick up export cargo in Asia, forcing carriers to “blank” (cancel) sailings. That dynamic eventually curbed the number of ships at anchor on the West Coast, and simultaneously, U.S. import capacity.
New trans-Pacific services have been added since the first quarter, meaning the anchorage numbers are likely to go higher in the current cycle before hitting their ceiling.
In addition to new liner services, shipping consultant Jon Monroe noted that “extra loaders” (ships sailing one-off voyages not in a regular service) and charter vessels “may make matters worse.” Monroe warned: “Be prepared. Picking up containers in Southern California will hit a new level of difficulty.”
A key variable for the weeks ahead involves the COVID-induced terminal closure in Ningbo, China. As of Monday, the affected terminal had been closed for six days. When COVID curtailed throughput in Yantian, China, in June, it gave Los Angeles/Long Beach a brief reprieve from inbound volume, reducing congestion temporarily, then subsequently increasing congestion as delayed Yantian cargo belatedly arrived.
Ship positioning data from MarineTraffic showed nearly 40 container ships at anchor off Ningbo on Monday. According to S&P Global Platts, “Port issues in China threaten to limit carrying capacity in peak season.”
Anchorages also filling off East Coast
On the East Coast, congestion has largely centered on the port of Savannah, Georgia, this year, driven at various times by high volume, weather closures of the Savannah River, and dredging.
As of Monday, MarineTraffic ship-positioning data showed 17 ships at anchor off Tybee Island, awaiting berths in Savannah.
According to Hapag-Lloyd, “Ships are delayed four to five days awaiting berth assignment. Berth congestion is not going to get better in the foreseeable future, with a minimum of 10 ships at anchor.” Hapag-Lloyd said that import loads are not moving out of the Savannah terminal fast enough, due to a shortage of chassis, trucks and warehouse space.
Meanwhile, ship-positioning data showed nine ships stuck waiting offshore of terminals in New York and New Jersey on Monday.
Maersk reported that at terminals in Newark, New Jersey, “Several vessels have been delayed this week due to congestion.” It noted, “Chassis continued to be a limiting factor [and a] large volume of import cargo has been discharged, which will most likely exacerbate the chassis issue.”
According to Hapag-Lloyd, arrival delays in New York and New Jersey “are currently running upwards of two to three days. High utilization is expected to last at least for the next two weeks, with delays causing a cascade of inbound vessels looking for open berths.
“Labor availability, yard turn times and productivity are still being affected by summer vacations” as well as “weather issues within the last week including temperatures of 95-100 degrees” and “COVID cases among port workers,” said Hapag-Lloyd.