USA Gridlock – Sea Freight

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USA Gridlock – Sea Freight

The delays with ocean freight cargo in and out of the USA is continuing, there was slight improvement earlier in the month but it has again escalated to the extent that shelves in some USA retailers are becoming bare.

Essentially there are too many vessels holding too much cargo and the infrastructure required to manage these vessels is not sufficient. This includes the ports, trucks, rail and warehouses. The volume of cargo has exposed the inefficiencies in the supply chain with particular point of interest being that the West Coast ports have only just made changes to operate a 24/7 facility.

The impact on Australian importers is the on going delays with lead times being extended an additional 4 weeks as a result of all the issues, there are also some additional surcharges starting to be applied as a result of the ongoing port congestion.

The following points highlight the volume of the congestion;

  • At the moment +80 vessels waiting to unload at USA West Coast ports
  • These vessels are holding the equivalent of 513000 X 20’ containers
  • It is estimated there is in excess of USD22B worth of stock in these containers
  • The average anchor to berth wait is now out to 18 days

To further highlight the 4th bullet point, the average sailing time ex Shanghai to Long Beach is 18 days. These vessels are now having to wait an additional 18 days before unloading can commence.

What is being done?

The Biden administration is under immense pressure to provide the necessary relief to the supply chain gridlock, the administration has appointed Pete Buttigieg the US Secretary of Transport to lead the efforts to resolve it. Since his appointment the congestion has increased and many are questioning is he the right person to manage this significant task? Alarmingly industry experts are suggesting the bottlenecks could take up to 14 months to flush out. Plans have been put in place for the ports to operate 24/7 but this will require a corresponding change in work practices from all other landside operators including trucking companies and warehouses. These are not changes that can be implemented post haste and lead to the suggestions that it can be up to 14 months to unlock supply chain gridlock.

What can you do?

From the beginning of the pandemic and regardless of the trade lane we have been imploring our customers to share your purchase orders with us when they are raised, and not wait until you have a goods ready date to alert us of any pending shipments. With bookings taking up to 4 weeks, engaging Lynair at the earliest possible time is as important as ever.

The USA port congestion crisis has also further impacted delays across all trade lanes, with vessels suffering such delays on the USA West Coast it has a corresponding effect on the vessels next sailing. Shipping line scheduling is suffering as a result with vessels then either arriving significantly late to the next port of arrival or being re routed to alternate trade lanes, our next sea freight bulletin will be providing a detailed update on all other trade lanes.

Please contact us at info@lynair.com.au for assistance with your shipments.