Director: cargo will continue to grow as solutions are sought
The supply chain issues that have given rise to a visible sea of congestion at the ports of Los Angeles and Long Beach should prompt both trade hubs to think ahead when it comes to infrastructure.
That was one of the points Long Beach port Executive Director Mario Cordero made during a harbor commission meeting Monday.
“Part of what we need to talk about going forward is lessons learned,” he said. “What are we going to do to get ready for 2025 or 2030 forecasts?”
The issue has drawn global attention in recent months, with the scope of the problem touching every corner of the supply chain — from ships arriving at port to the trucks and trains that carry the containers nationwide to the warehouses that store the goods — and has caused some experts to warn of holiday shortages.
Industry forecasts have for years predicted the problems that cargo surges could cause the supply chain.
A July 2015 Federal Maritime Commission report, for example, said, “Congestion at ports and other points in the nation’s intermodal system has become a serious risk factor to the relatively robust growth of the American economy and to its competitive position.”
What wasn’t foreseen was the scope of the problem and, of course, the unpredictable event that triggered it all: a global pandemic that shot e-commerce buying skyward. The National Retail Federation has forecast 2021 sales to come in at $4.44 trillion to $4.56 trillion, a 10.5% to 13.5% jump over 2020.
It’s all created, Cordero said, a perfect storm that has caught the attention of both Sacramento and Washington, D.C., prompting a July 15 roundtable on port congestion and supply chain resiliency led by U.S. Department of Transportation Secretary Pete Buttigieg and Federal Maritime Commission Chairman Daniel Maffei.
In August, the White House appointed John Porcari as port envoy to the Supply Chain Task Force.
The cargo surge is expected to continue until summer, but the congestion and backlog could be eliminated sooner, Cordero said in his presentation.
A long-term vision, Cordero said, will require both ports to work together. More reliance on rail will be needed in the future, he said, along with better planning for warehouse space.
Making use of inland spaces at the port will also make a difference, Cordero said, pointing to the STOR yard that the Port of Long Beach uses to stage and store empty containers and chassis.
The Port of Long Beach’s push to build and open last year the Gerald Desmond Replacement Bridge, along with this summer’s completion of the Long Beach Container Terminal, billed as the “greenest” shipping terminal in the nation, has given the port a major boost in ability to handle the growing cargo surge, Cordero said.
The port also has launched a 24-hour pilot operation at Pier T in hopes of getting more trucks to call during the so-called “hoot shift” (from 3-7 a.m.) to pick up cargo rather than adding to the busier peak times.
“Staff and I have had productive conversations” with cargo shippers to promote the 24/7 shift, he said, hoping that more trucks will be picking up cargo at 5 a.m. rather than 8 a.m. to head to inland warehouses.
It will all take time, he said.
“We can’t flip a switch,” Cordero said, “and expect everyone to move cargo at 5 in the morning.”