With global shipping demand surging at the same time that Asian ports are seeing a huge backlog in exports and U.S. ports are jammed from extra cargo, it’s likely that one of America’s largest ports will continue to face serious congestion through the 2nd quarter or beyond.
The Ports of Los Angeles and Long Beach are critical to U.S. port infrastructure as a main hub for U.S.-Pacific trade and Asian market exports. However, throughout much of the COVID-19 pandemic, as Chinese manufacturing ramped back up after being almost entirely shutdown at the start of the pandemic, this critical port has seen some of the heaviest congestion from pent-up demand and other developments.
According to JOC.com, the situation is not getting any better on the U.S. West Coast, as delays continue.
The overall situation is being affected by continuing higher-than-usual cargo volume. In 2021, the volume of cargo imported has been as high as 40% percent more than two years ago, a monster increase that is fueling much of the LA-Long Beach port congestion. At the same time, exports are expected to increase, which will further complicate matters.
PIERS estimates Asian imports at the Ports of Los Angeles and Long Beach to be as high as 800,000 TEUs monthly throughout much of 2020 and into this year. Although the overall congestion at the ports is not worsening, it’s not getting better yet, either.
Only time will tell how fast the situation improves.
With the COVID-19 pandemic beginning to wane with global vaccinations increasing, economic activity will likely continue to increase. This will mean more consumer spending – and a result – more imports for U.S. West Coast ports to handle and process. It is likely that the surge will not come to an end for some time. After initially believing the surge would ease following the Chinese New Year holiday, that did not come to pass, complicating the outlook.
As more and more companies reopen and workers are vaccinated and return to work, increased economic activity will likely follow. This may help improve the challenges faced at Los Angeles-Long Beach by increasing the amount of workers there to process the backlog of cargo.
At MTS Logistics, we will keep you informed on all developments on port congestion and other shipping issues.
