Marine Exchange of Southern California
This video shows how the US's largest ports handle record backlogs.
Robert Khachatryan, Freight Right CEO, explains how ports arrange dozens of ships into "parking spaces."
As the holiday shopping season approaches, record shipping delays don't seem to be slowing down.
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If you haven't seen the massive cargo ships stacked up along Southern California's shores, it's hard to grasp the magnitude of the situation. Freight Right Global Logistics shows you how Long Beach and Los Angeles manage up to 500,000 shipping containers.
The cargo ships take on average 10 days to unload at the two largest ports in the US. The glut of cargo ships might seem chaotic to the untrained eye. However, Freight Right CEO Robert Khachatryan explains that the cargo ships are laid out in a specific pattern to ensure the shipping lanes are clear for both incoming and outgoing vessels. It also prevents the huge ships from colliding into each other.
The dashboards of the Marine Exchange of Southern California and the shipping companies allow for remote tracking of the ship's coordinates.
Marine Traffic of Southern California Dashboard Marine Traffic of Southern California
Every vessel, regardless of whether it is moored closer to the shore or drifting 20 miles from the shore, occupies a number of spots that are assigned to it based on GPS coordinates.
Khachatryan stated that the problem is not the shortage of shipping containers but the inability to handle the large number of ships inside the ports. Because they are so close, the ports can handle only 30 ships at once, a level that was not possible before COVID-19 shut downs.
Khachatryan stated in the video that the port can handle all containers given its infrastructure capacity. Therefore, adding vessels to the problem does not solve it. The solution is to move these containers out of port. Unfortunately, this is not happening fast enough.
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Shipping companies are losing more money every day as the ports experience a near-record backlog. Khachatryan stated that the 10 day wait to enter the port can often cause ships to miss about two trips between Asia and America. According to Khachatryan, many larger container ships that are waiting at the shore can lose between $500,000 and $600,000.
The video shows more than just the ships. It also includes many of the Port of Long Beach’s processes. This includes the automated parts of terminals where containers are lifted by huge cranes and then moved around the port.
Although the port handles over 40% of US imports and is the largest, several large companies have taken steps to avoid the backlog. The average shipping container price for 20-foot containers has risen to record levels of over $20,000.
These ports are being avoided by large companies. Coca-Cola chartered three bulk shipping vessels that are used for material like coal and grain to charter goods to its plants. The company made this unusual move citing a shortage of cargo space and shipping containers as well as the desire to avoid congestion in ports.
Costco, Target and Walmart rented their own container ships to reevaluate traditional methods and avoid delays in product shipment and empty shelves ahead of the holiday shopping season.
As consumer demand continues to put pressure on an already congested global supply chain, several other US ports are reporting backlogs.
Business Insider has the original article.
