by Lloyd's List

14 August (Lloyd's List) - CONTAINER dwell times in the port of Los Angeles are rising as the port contends with “blockbuster” cargo volumes setting all-time records.

The port handled a July record of 939,597 teu in the past month, with imports crossing the 500,000 teu mark for only the fourth time in the port’s history.

The increased volumes are beginning to stress the fluidity of container movements in and out of the port, although executive director Gene Seroka said the strain was manageable.

Dwell time for on-dock rail containers has moved up “too high” at over six days, whereas it should be between two and four days, Seroka said during a monthly press conference on Tuesday. About a third of Los Angeles’ cargo moves by rail.

There were also 7,900 rail containers designated for on-dock loading that are dwelling for nine days and longer at the terminals, which, according to Seroka, was about 1,000 too many.

“But again, these are mini-spikes, and I have seen this rail activity now for months move in that direction about every six- to eight- weeks and then work itself down,” he said.

Street dwell time for 40 ft chassis has also gone up, Seroka acknowledged. However, he concluded that he does not “see anything that is a cause for alarm”.

“We have been clipping out the past three months at really high productivity… And I think the previous or historical capacity of about 1m teu per month — we can go through that number. We are probably at 1.1m teu-1.2m teu just from what we have learned over the past several years,” he said.

“But we will keep watching this every day.”

Disruptions fuel summer cargo surge

“Simply put, an early peak season has helped boost volumes here at the port of Los Angeles,” Seroka explained.

Aside from a strong US economy, volumes have been buoyed by an influx of year-end holiday cargo that has been coming in earlier than usual due to Red Sea crisis and labour uncertainty on the US east and US Gulf coast, where a strike on October 1 is looking increasingly likely.

“Importers have told me that with issues in the Red Sea and ongoing east coast labour talks, they’re being extra cautious this year,” Seroka said.

“So those holiday products — think of toys, clothing, footwear and electronics — are arriving now to avoid risk later in the year. And these goods are coming at the same time as the more typical back to school, fall fashion, and holiday merchandise.”

Seroka was joined at the press conference by Paul Bingham, economist and data analyst at S&P Global Intelligence.

According to Bingham, “supply chain managers have been trying very hard this year to mitigate risk in advance by changing their operating practices”.

Other issues managers are contending with are potential rail and port strikes in Canada, and the new tariffs imposed by the Biden administration on Chinese goods.

“All of that has impacted the market performance we’ve seen this year, and the net result in terms of vulnerability for the east coast labour situation is to reduce the risk of disruption that would follow an actual strike,” Bingham said.

Volumes could taper off, but will remain strong

August volumes are expected at or above 850,000 teu. They could taper off from there, but should remain strong throughout the coming months, Seroka said.

According to Bingham, while it was “certainly possible” that volumes peaked in July, they will not crash afterwards.

“There is still going to be strong volumes through the remainder peak season through October,” he said.