Record Container Vessel Traffic Jam As Backlog Continues

If you look at Los Angeles (LA) and Long Beach (LB) — the largest container import gateway in America — you’d think that shipping congestion has reduced drastically. The number of vessels waiting there has dropped to 26 from 109 observed in January. But, the North American port congestion has reportedly re-entered the record territory. And the offshore traffic jam is as bad as it has ever been.

In January and February 2022, when North American congestion increased, there were below 150 container ships waiting off the coastlines. Two-thirds were in the LA/LB queue.

As reported on Thursday morning, there were 153, the majority of the ports of the East and Gulf coasts. The earlier West Coast pileup was highly publicized, centralized, and easier to track. Today’s ship queue is relatively more widely disbursed and catching less attention.

Ship queues bounce back.

Port congestion appeared like it was easing in May and toward June beginning. Ship queues fell back to numbers in double digits. 92 ships were waiting offshore as of June 10, followed by 25 off Savannah, 20 of LA/LB, 18 of New York (NY)/New Jersey (NJ), and 14 off Houston.

Then, things took a turn. The tally touched 125 on July 8, 136 on July 13, and 140 on July 19.

With the count touching 153, the North American container vessel queue has gone up by 66% in size over the past seven weeks.

As reported on Thursday morning, ship-position data shared by MarineTraffic and the latest queue lists for California ports reflected that 43 container vessels were waiting off Savannah; 15 off Oakland; 26 off LA/LB; 24 off Houston; 17 off Vancouver; 18 off NY/NJ; and ten ships off many other ports.

Of those, 59 ships – 38% of the total – were waiting off the West Coast, where queues climbed off Oakland and Vancouver. Reportedly, there were 94 vessels – 62% of the total of the ports of the East as well as the Gulf coast, with counts up in both Houston and Savannah.

Different terminals, different waiting time
VesselsValue, a UK-based data provider, observed significant differences in the wait times at the top 10 East Coast terminals, including huge differences between the terminals within the same port complex.

It showed four East Coast terminals with long wait times: the NY and Elizabeth APM terminals in the Port of NY/NJ and the Savannah and Garden City terminals based at the Port of Savannah.

In contrast, VesselsValue data highlighted relatively short wait times at the Port Newark and Maher terminals in NY/NJ; the Virginia International Gateway and Norfolk International terminals in Norfolk; the Packer Avenue terminal based in Philadelphia; and also South Carolina’s Wando Welch terminal.

The shift brought about by port labor fears?

It may be no coincidence that East and Gulf Coast congestion reportedly ramped up in June. That was also the month the new annual contracts were rolled out. It was also the last month before the West Coast labor contract with the ILWU longshoreman union ended.

Akhil Nair, the VP of carrier management at Seko Logistics, mentioned in a briefing held on July 20 that with early threats of labor constraints and potential ILWU strike on the West Coast, there was a shift during the contract season for consumers to look for conventional shippers of West Coast to request allocation also on the East Coast. This was a contractual hedge that they placed.

References: Freight Waves, Zero Hedge, Information Tourism