US port traffic jam brings Christmas ahead for importers

About a quarter of a trillion dollars in cargo will have passed through the Port of Los Angeles by the end of December 2021.

LOS ANGELES: Christmas arrived early – June, to be precise – in the Port of Los Angeles, as U.S. importers scrambled to get ahead of a traffic jam caused by a pandemic that has scolded global shipping.

The port, North America’s busiest container terminal, began 24-hour operations on Thursday after the White House intervened to help ease bottlenecks that are choking trade and driving up costs. price.

Yet dozens of ships carrying hundreds of thousands of containers remained anchored outside the port, waiting for a berth on crowded docks. Many will wait more than 10 days.

“We’re busy,” Port of Los Angeles executive director Gene Seroka said Thursday.

“(Americans) don’t go to ball games, we don’t go to the movies or the opera; we buy products. Whether we go to our big box retailers or buy online, these products need to replenish. “

Economies largely closed for chunks of last year by governments trying to contain the coronavirus are reopening, and demand is booming – but supply is struggling to keep up.

Globalization has weakened supply chains that stretch from resource extraction in places like Australia, to production in Asian manufacturing centers, to Western buyers.

Between each stage, the goods are loaded into box containers and transported on ships, trains and trucks through ports and stations.

If one of these steps fails, the whole chain can stop.

During the pandemic, almost all of them did.

And even if things start to return to normal in the United States, the effects are still being felt.

“Everything is late, all the ships are in the ocean,” truck driver Tony Nguyen told AFP.

“I’ve been driving for the port for almost 10 years, but this year it’s been terrible. I’ve never seen this before.”

Realizing the bottlenecks, US importers began their Christmas preparations early, stocking up on wreaths and toys while most Americans got ready for summer.

“The US importer… brought up a lot of the holiday inventory, earlier than we’ve seen in recent years,” Seroka told CNN earlier this month.

“Importers started importing holiday season goods in June, so two to two and a half months earlier than expected.”

On Tuesday, the International Monetary Fund warned that supply chain disruptions are driving price increases as it slashed its growth prospects in an increasingly uneven global recovery.

In the United States, consumer prices rose more than 5% in September.

Several factors explain the shortages of raw materials and finished products that currently afflict retailers.

These include factory outages in countries that have imposed closures due to Covid-19, unexpected spikes in demand for some products as behaviors changed during the pandemic, and a labor shortage. artwork.

But the backlog at US ports was a major contributing factor.

And nowhere is this more evident than the neighboring ports of Los Angeles and Long Beach – the main gateways to Asia, where thousands of multicolored shipping containers are stacked, processed and moved every day.

The Port of Los Angeles alone has handled over 7.3 million TEUs so far this year. One TEU is the industry standard measurement for freight and stands for twenty foot equivalent unit.

Each year, more than a quarter of a trillion dollars in goods pass through the port, a significant portion of the overall U.S. economy.

“What happens in Los Angeles and other West Coast ports reverberates across the country,” said Peter Friedmann, executive director of the Agriculture Transportation Coalition.

The World Bank estimates that 8.5% of global container transport is blocked in or around ports.

This congestion renews discussions on offshoring – bringing production home.

“Never again should our country and our economy be unable to manufacture essential products that we need because we do not have access to the materials we need,” US President Joe Biden said this week.

“We will never have to depend too much on a company or a country again.”

About Jun Quentin

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