Biden’s 24/7 plan to ease LA port congestion finds few takers

When last month US President Biden announced a deal that would see 24-hour operations at the Port of Los Angeles in an attempt to ease the container ship traffic jam outside the port, not a few observers thought that the move was more of a high-profile response to alleged rising consumer prices rather than an effective policy.

And so it has proved. Los Angeles port executive director Gene Seroka said the harbour had a 24/7 capability, but that a shortage of truck drivers and night-time warehouse workers posed problems when it came to establishing a round-the-clock schedule

“It’s an effort to try to get this entire orchestra of supply chain players to get on the same calendar,” he said.

Seroka also noted that, among thousands of importers, “we’ve had very few takers to date.”

A more effective move appears to have been the threat from the ports of Los Angeles and Long Beach to impose fines on containers that “dwelt” too long in the port. Seroka said the port had witnessed a 25% drop in the number of import containers on the docks since October 24th (when the plan to introduce the fines was announced), from 95,000 to 71,000. During the same time, cargo sitting nine days or longer dropped by 29%. This fall has meant that the date of the actual implementation of the fines has been put back several times.

Meanwhile, in an effort to improve the fluidity of POLA and Long Beach, France-based CMA CGM Group will implement an Early Container Pickup Incentive Programme at the two ports. It became effective December 1st and will continue for 90 days. CMA CGM said that the incentive would be provided to the importers that pick up their containers via merchant haulage from all the terminals in Los Angeles and Long Beach in the first eight days, with the intent that they will use it to offset costs incurred by tensions on their supply chains.

The incentive will be:

  • $100 per container for daytime pickup from Monday to Friday;
  • $200 per container at night and on weekends.

CMA CGM said that its commitment could exceed $22m over 90 days.

The company also said that it would support financially the Fenix Marine Services terminal in expanding its hours of operation so that containers could be picked up day and night, seven days a week.

Ed Aldridge, president of CMA CGM and APL North America, said that “the CMA CGM Group is committed to doing everything we can to assist in improving overall supply chain velocity in southern California. By incentivizing the movement of containers off the terminals and ensuring pickups can be made on nights and weekends at FMS, we will decrease truck turn times and expedite the flow of goods into the United States. This is just one more way we are working with our port partners and the Biden-Harris Supply Chain Task Force to ensure shelves are full and Americans have access to the vital items they need on a daily basis.”