As many container vessels continue to wait across Southern California and farther, waiting for berths at the ports of Los Angeles and Long Beach, digital freight forwarding platform Shifl, said there has been a consistent increase in transit time between Chinese-base ports and the West Coast ports.
Meanwhile, it said that the port of New York is performing better in terms of the transit times — which is measured from the time a container departs from the port of origin until it is discharged at the destination terminal — from major Chinese ports.
In a statement, it said according to its data, transit times have gone up steadily since the summer of 2021, with transit times in December across the ports of Los Angeles and Long Beach recording 45 days.
On average, transit times across the West Coast ports have risen by 96% since May 2021.
"This is 181% higher than a pre-pandemic transit average that stands at 16 days between major Chinese ports like Qingdao, Ningbo, Shanghai, and Yantian to the ports of Los Angeles and Long Beach," Shifl said.
Meanwhile, it noted that the port of New York has fared better in recent weeks, dropping its transit time from 44 days in the third week of November to 33 days by the second week of December.
"A consistent increase of incoming vessels could be one of the reasons for increased transit times. Large numbers of ships continue to pile up in the ports of Los Angeles and Long Beach with some ships slow steaming on their way to USA in order to reduce the time they spend at anchor close to the ports of Los Angeles and Long Beach, waiting for a berth," the digital freight forwarding platform said.
"California regulations now warrant vessels to wait far from the shore to mitigate near-shore pollution that has risen due to the queuing ships."
Shifl added that while transit times have kept climbing, landside port operations have seen a reversal, fortunately.
Shifl: Divert from Port of LA/Long Beach
Container dwell times have also been consistently falling since late October across the West Coast, which coincides with the announcement of additional tariffs on long-dwelling containers at the Los Angeles and Long Beach port terminals.
Since mid-October, it said the Port of Long Beach saw import container dwell times drop from 12 days to 5 days currently which is a 140% improvement, while the port of Los Angeles recorded a 125% improvement with import container dwell times dropping from 9 days to 4 days currently.
The port of New York, on the other hand, has "consistently managed" to keep container dwell times low, according to Shifl, with it never going beyond 6 days since May 2021, bringing it down to 3 days now, a 67% reduction in since mid-October.
"We need to stop the ripple effect of ships waiting endlessly at Los Angeles/Long Beach even if it means diverting some ships to other ports like New York/New Jersey which is currently recording a quicker transit than West Coast Ports, optimising the use of some terminals which are underutilised and operate only till 4 pm,” said Shabsie Levy, founder and CEO of Shifl.
"Regardless of how hard we work to improve performance in the ports, the continued influx of ships is going to overwhelm their capacity. This is a structural breakdown that more workers and longer hours won’t fix. The imbalance leads to new blank sailings, which the current uptick in pricing out of China shows," Levy added.
Impact of congestion on freight rates
Shifl noted that the high number of ships stuck off the coast of Southern California and further, is impacting freight rates which were starting to drop.
As per data tracked by Shifl, it said the freight rates are on the rise again and this is attributed to the increased demand for space out of China brought about by the lack of ships to load cargo on as the ships are still waiting in Los Angeles/Long Beach.
"Once all these ships return to Asia, we are hopeful that rates will come down again and we might have an opportunity to get out of the repeat ripple effect as we get into the traditionally quieter months post Chinese new year," Levy added.
