Tuesday, October 3, 2023
HomeHeadlinesLos Angeles/Long Beach ports delay dwelling fees


To our FREE newsletter
Get all the latest maritime news delivered straight to your inbox.

Los Angeles/Long Beach ports delay dwelling fees

The Ports of Los Angeles and Long Beach in Southern California delayed imposing escalating new fees for containerized cargoes that dwell too long in terminals to Nov. 22 from Nov. 15 despite a queue that has grown to a record of 87 ships waiting to berth at the dual ports.

As part of a 90-day policy led by the Biden-Harris Supply Chain Disruptions Task Force, the ports began assessing the dwell times of loaded import containers Nov. 1. Cargoes that exceed eight days in the container yard awaiting truck haulage or five days on-dock rail units will be assessed a Container Excess Dwell Fee of $100/day per container, increasing by increments of $100/d until the container leaves the terminal.

According to the Port of Los Angeles, there were 8,392 containers dwelling at the port for nine to 12 days as of Nov. 15, and 20,857 boxes that have been dwelling in terminals for 13 or more days. But aging cargoes at the Ports of Los Angeles and Long Beach have declined 26% since the new fees were announced Oct. 25, leading the two adjacent Southern California ports to extend the grace period for the new fees by another week to give shippers and carriers more time to remove their cargoes.

“We’re encouraged by the progress our supply chain partners have made in helping our terminals shed long-dwelling import containers. Clearly, everyone is working together to speed the movement of cargo and reduce the backlog of ships off the coast as quickly as possible,” said Port of Long Beach Executive Director Mario Cordero. “Postponing consideration of the fee provides more time while keeping the focus on the results we need.”

A loaded import container that remained in terminal yards since Nov. 1 and left after 3 am Nov. 15 would have been billed $2,800 in penalties, which all major carriers have announced would be passed on to shippers directly in surcharges, regardless of whether a truck chassis was available to remove the cargo or if the shipper’s contract contained a “no-new surcharge clause,” which would not apply to government-imposed fees.

“Our objective with this program is not to generate revenue,” Los Angeles Harbor Commission President Jaime Lee said in announcing the new policy Oct. 29. “Instead, we need our supply chain partners to make operational changes that will reduce dwell times, clear our terminals and make room for the ships waiting to enter our port.”

The queue of ships at anchor or drifting in the San Pedro Bay waiting to berth at Los Angeles/Long Beach terminals surpassed 80 ships for the first time Nov. 9 and set a new record of 87 ships Nov. 15, according to cFlow, Platts trade flow software. A previous surge in traffic to the ports rose to more than 40 ships in February before easing in the summer, while there was seldom any ship queue at all prior to the pandemic lockdown-fueled import boom that began in mid-2020.

When the ship queue was up to 73 Nov. 3, Port of Los Angeles Executive Director Gene Seroka said 50 of those vessels were new entrants to the trans-Pacific trade lanes in the sub-10,000 TEU capacity class and did not have advance bookings at Los Angeles/Long Beach terminals. These ships, some of which were chartered by major importers such as Home Depot and Walmart, were waiting weeks or months in some cases for space to open up at the terminals.

Other new entrants to the trans-Pacific eastbound market previously operated intra-Asia feeder or cabotage services and were attracted to the trans-Pacific trade by rates that ballooned to more than $15,000/FEU for North Asia to US West Coast shipments in August-September, although these premium rates have since eased to around $10,000-$12,000/FEU on the spot market.

The Biden administration in October called for the Ports of Los Angeles and Long Beach to operate on a 24/7 basis to reduce supply chain disruptions. The Port of Los Angeles said it has been working with stakeholders to move toward night operations, but the Port of Long Beach has since ended a pilot program of night gate hours that began in September because warehouses in the area were not also operating at night, which prevented trucks from unloading and returning their chassis to the port outside normal business hours.

But there were also signs that US import volumes were at least temporarily easing as most pre-holiday cargoes have shipped and many Chinese factories were operating at about 60-70% capacity due to power and labor shortages, which could take some pressure off Los Angeles/Long Beach throughput capacity. The Port of Los Angeles is forecasting import volumes in the week of Nov. 21-27 to drop 41.1% to 104,394 from 177,300 TEUs in the week of Nov. 14-20.

The Port of Tacoma’s Husky and Washington United terminals similarly announced in early November one-off long term dwell fees of $315 and $310, respectively, for loaded containers that sit in the terminals for more than 15 days, in addition to late fees of $230/d for cargoes that dwell more than four days.

Platts Container Rate 13 — an assessment of Freight All Kinds base rates from North Asia to West Coast North America — dropped by $150/FEU to $8,350/FEU Nov. 12, the lowest rate since Aug. 31 as export volumes from Asia slowed and more carrying capacity from China became available on the spot market.

Source: Platts

Related Posts


Finance & Economy
Shipping News

TOP Ships Announces Reverse Stock Split

TOP Ships announced that it has determined to effect a 1-for-12 reverse stock split of the Company’s issued common shares. The Company’s shareholders approved the...

Carnival Earnings Outlook Misses While Fuel Costs Near 15-Year High

Carnival Corp. posted a profit for the first time since 2020 but issued a fourth quarter earnings outlook that missed Wall Streets’ expectations as...

Sphinx Investment Corp Increases Stake in OceanPal

On September 28, 2023, an OceanPal SEC filing revealed that Sphinx Investment Corp. had raised its ownership in OceanPal, now holding a substantial stake...

Star Bulk Announces the Repurchase of 10 Million of Its Common Shares

Star Bulk announced that it entered into a Repurchase Agreement (with OCM XL Holdings, LP, a limited partnership incorporated in the Cayman Islands, pursuant...

Trafigura announces executive leadership changes

Trafigura Group Pte Ltd. has announced an evolution of its executive team to further strengthen leadership and focus across its global activities during a...

Baltic index snaps 4-day winning streak as capesize rates slip

The Baltic Exchange’s main sea freight index, tracking rates for ships carrying dry bulk...

Baltic index scales 11-month peak on strong capesize rates

The Baltic Exchange’s main sea freight index, which tracks rates for ships carrying dry...

Baltic index scales over 9-month high on capesize surge

The Baltic Exchange’s main sea freight index, which tracks rates for ships carrying dry...

Baltic index rises to over 4-month high on stronger capesize rates

The Baltic Exchange’s main sea freight index, which tracks rates for ships carrying dry...

Houston-Japan VLGC freight rates reach multi-year high

VLGC freight rates from Houston to Chiba, Japan, reached $245/mt Sept. 21 for the...

Ukraine: 5 More Cargo Ships Head For Black Sea Ports – report

Five more ships are on their way to Ukrainian sea ports using a new corridor opened to resume predominantly agricultural exports, an alternative arrangement...

Piraeus Port reports strong H1 2023 results

The Piraeus Port Authority SA, which operates Greece’s biggest and busiest port, reported a 48.8-percent increase in pre-tax earnings for H1 2023 – 49.4...

Greece names Thessaloniki port operator preferred bidder for Volos port

Greece’s privatisation agency has named the operator of Thessaloniki port as the preferred bidder for acquiring a 67% stake in the port of Volos,...

Drewry: Port Throughput Index Down 2.1% in July

The Global Container Port Throughput Index fell 2.1% MoM in July 2023, with the small rises recorded in Africa and Oceania having been insufficient...

Vopak: Agreement with Infracapital on sale of Rotterdam chemical terminals

Vopak announces that it has reached an agreement with Infracapital on the sale of its three chemical terminals in Rotterdam (Botlek, TTR and Chemiehaven)...