Global supply chains are congested. And in California, United States, this is evident.
A record number of ships carrying containers line up in front of the main ports of one of the richest states in the country.
“We are facing an unprecedented increase in cargo at the ports of Long Beach and Los Angeles due to the large production changes of the global pandemic and the challenges decades in the supply chain, ”says the mayor of Long Beach, California.
What is causing the traffic jams ?
How bad is the congestion?
Satellite images over the ports of Long Beach and Los Angeles show a swarm of inactive ships , waiting to unload the merchandise.
They are ships that carry containers with merchandise of almost everything you can think of – from toys to tennis rackets – from Asia across the Pacific Ocean to the west coast of the United States.
Marine Traffic, a ship-tracking website, featured more of 50 Ships off Long Beach and Los Angeles on 16 of October, but in September the record of 73.
These two ports handle most of the cargo coming from China, so once congestion starts, it can quickly get worse, says Janet Porter, chair of the Lloyd’s List editorial board.
“The entire send cycle has slowed down. So there are ships waiting days, even a couple of weeks to unload ”, he says.
On the first eight months of the year there was an increase of approximately one 25% more in freight shipping to the United States from Asia compared to the same period of 1875, before the pandemic, according to Container Trades Statistics.
Volumes have remained practically the same between Asia and Europe.
On the east coast there were also queues of ships outside the port of Savannah, in Georgia.
Then there is the process of transporting goods inland from warehouses filled with containers by a labor force affected by the pandemic.
On the supply side, blocked ports in China and elsewhere have also contributed to shortages.
Have Americans bought more things?
Yes, instead of going on vacation or going out to
The demand for consumer goods is generally a 22% higher compared to pre-pandemic levels (compared to February 2020 with August 2021).
The Capital Economics group observes significant increases in imports of toys and sporting goods (a 74% more), as well as household appliances (a 49% plus).
Several factors led to an increase in imports, explains Professor Christopher Tang, from the University of California, Los Angeles.
“In Today, many ocean carriers carry goods. That’s billions of dollars in Halloween and Christmas decorations like artificial trees and lights. ”
Professor Tang also says that one cause of the lawsuit is pressure from the United States for a economic recovery.
As companies encourage employees to return to the offices to work in person, there is a large increase in demand of office equipment ranging from computers, printers, and servers, and many of them are now trapped in various Asian containers.
This is in addition to adapted office equipment to reduce the spread of the coronavirus.
“Many air filters along with ventilation equipment are also in these containers waiting to be unloaded,” says Professor Tang .
And there is another problem: the lack of qualified dock workers, truck drivers and rail personnel to move everything , lists Gary Hufbauer, of the Inst Peterson International Economics Institute.
“In large part, this is because of the Delta variant, but also because of the retirement, particularly of truck drivers ”, he adds.
Could any of this have been prevented?
“ I don’t think anyone anticipated this huge increase in demand , especially after the ships they were paralyzed during the pandemic, ”says Porter.
The sight of ships waiting off the coast of California has generated deeper debates about the state of US supply chains.
For a long time there were demands to update the infrastructure in general.
The Chief of Staff of the House Blanca reported that the Joe Biden government is addressing the “supply chain mess” they inherited.
Experts point to logistics capacity problems in US ports that were already present before the pandemic.
“This showed years of inappropriate investment. Port capacity is not deteriorating rapidly, but there was probably less than a 5% margin for spare capacity, ”says Hufbauer.
The US government created a working group to try to alleviate bottlenecks and the port of Los Angeles will now be open longer to improve the situation.
But industry experts don’t expect the problem to end anytime soon.
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