Worldwide Congestion

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As cargo volumes have rebounded from the recession, some have expressed concern that congestion is growing at the Ports of Los Angeles and Long Beach. As we move to evaluate and address these concerns, it is important to recognize the situation here is just one facet in a global readjustment. Consider these headlines from the past two weeks alone:

Penang Port Needs a Month to Solve Woes (Malaysia Star, July 28, 2010)
Retailers Pay More to Get Cargo (No Guarantee) (New York Times, July 26, 2010)
Haiti’s Port System Chokes Supply Lines and Commerce (Tampabay.com, July 24, 2010)
Nigeria: Reps, Stakeholders Meet on Apapa Port Congestion (AllAfrica.com, July 23, 2010)
Indian Port Congestion Causes Severe Delays (Journal of Commerce, July 23, 2010)
Trade at Risk as Urban Sprawl Hits Ports (The Australian, July 22, 2010)
Congestion Returns to European Ports (Journal of Commerce, July 20, 2010)
Port Congestion Threatens Brazilian Sugar Shipments (AgraNet, July 19, 2010)

Cargo owners, shipping lines, terminal operators, trucking companies – pretty much everyone in the goods movement industry – ramped down when the recession hit. Now that we’re seeing import and export demand start to improve, everyone is trying to ramp back up as quickly as possible. While some ports are facing congestion issues as a result of bad weather, lack of space or political holdups, the fact is that we’re all doing our best to move cargo as quickly as possible.

The terminal operators in Los Angeles and Long Beach are no exception. Last year, terminal operators had to take measures to manage costs – as has everyone in this economic climate. Last year we eliminated one OffPeak gate. This was a difficult decision but it was necessary and we made it knowing that when cargo volumes recover, we could and would add back that additional gate.

Programs like PierPass cannot be switched on and off as volume dictates, but we can be flexible. There is a substantial investment in establishing such a program, and it’s important that we are committed to maintaining the program as long as it provides value to the trade.

The return of cargo volumes and maximizing port capacity are issues the industry is facing in all regions of the world, not just the San Pedro Bay ports. I look forward to seeing how other ports deal with issues of congestion and turn times and what we can learn from them.