Truck shipping

Here is the truth behind the commitment of port operations 24/7

When you pull the frills off President Biden’s supply chain announcement, he’s essentially a political pawn to push the infrastructure bill forward. The sad truth is that congestion won’t be eased anytime soon, and it sure won’t be better in the next 90 days. Why?

It’s common sense and math.

You cannot blame private sector companies for the future disappointment of this plan. Trade requires people and coordination between all actors in the supply chain. Ports and all stakeholders within those ports need to be on the same page when it comes to 24/7 operation.

There are many holes in this ad.

First, 3,500 additional containers moved in a week, that’s 200 containers per day. During the month of August, the ports of San Pedro Bay moved 1,241,896 TEUs. This 3500 projection does not move the needle at all. This only represents 14,000 containers, which is only 1% of the total TEUs. This plan is called a “sprint”.

Biden’s announcement of the 24/7 ports is not accurate. Only one terminal out of the 12 in San Pedro operates 24 hours a day – Total Terminals International (TTI) at the Port of Long Beach – and both of these times are only valid Monday through Thursday, making this a 24 hour situation. / 24, 7/7, not 24/7.

An official at the Port of Long Beach said discussions are underway with other terminals. But so far, no other terminal has signed. In the pursuit of 24/7, you need everyone involved to be successful.

The 24/7 operation at the Port of Los Angeles isn’t even happening. When asked if the port was operating 24/7 on Thursday, the day after this announcement, the port’s press office responded in an email:

“No

The ports are therefore currently in the status quo with regard to expanded operations.

The reason for this lack of 24/7 is that every facet of the supply chain must participate equally. Truckers will not work 24/7 if they cannot retrieve containers from a closed warehouse. The flow of trade shifts when everyone in that flow is working. The question is, what can be done to change the behavior of actors in the supply chain to move to 24/7?

This frustration can be read in a press release from the Harbor Trucking Association, which said the Biden administration’s plan did not address the fundamental issues plaguing the supply chain.

The statement said, “While steamboat companies and their marine terminal partners have blamed the trucking industry for not using appointments during this crisis, the underlying causes have continued to erode. ‘worsen without control. The challenges faced by truckers doing business in ports stem from productivity and efficiency issues that are not alleviated by simply switching to 24/7 gate operations.

The HTA said thousands of empty containers are currently in the trucking stations above the chassis, preventing those chassis from moving an import container from the dock.

“So these appointments are not used. … It’s not a problem of reluctance to pick up goods, the whole supply chain wants that cargo moved. Rather, it is a tangle of changing constraints that hinder and discourage participation, ”the statement said.

Also in this plan, FedEx (NYSE: FDX), UPS (NYSE: UPS) and Walmart (NYSE: WMT) have been mentioned to help lighten the supply chain.

When asked for details, FedEx Global Media Relations responded, “FedEx Logistics President and CEO Dr. Udo Lange appreciated the opportunity to join other business leaders and to administration to share our expertise and discuss supply chain issues, but we have no further details to share. right now.”

Walmart spokesperson Ashley Nolan said: “We will increase throughput by up to 50% during the added night hours at the port.”

At the time of posting, UPS has not responded to comments.

In the sea of ​​faces of the attendees at this press event, a critical piece of the supply chain was missing: shipping carriers and port terminals.

When asked the office of Transportation Secretary Pete Buttigieg why there was no attendance, the response was vague: “The administration has and will continue to have a regular dialogue with ocean carriers and operators. terminals.

And yet at least one of those carriers has not been contacted – Hapag-Lloyd, one of the largest shipping companies in the world.

“We have not been approached,” confirmed a spokesperson for the company. “The ships are already operating 24/7 whenever possible. The challenge is to get the containers out of the terminal by truck and train as the warehouses cannot / cannot take weekend deliveries. It is a lot about the inability of shippers to take delivery of their goods and infrastructure bottlenecks in the United States.

Carriers and terminal operators are the centerpiece of this puzzle. The terminals are the key segment of the supply chain that not only schedules the pickup and drop-off of containers from the trucks, but they also require the manpower to unload the ships.

So if it’s a 90-day sprint, the US supply chain needs more muscle and a huge dose of adrenaline.
Source: FreightWaves


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