In 2021 and the start of 2022, the disruptions from the pandemic showed their impact on world supply chains. Product shortages, port congestion, and ocean container shortages are inextricably linked, creating a vicious circle of obstacles to a smooth and efficient experience.
On top of that, land and air transport are facing their own issues, including truck driver shortage and a poor labor market, forcing organizations to take innovative approaches to supply chain delays and disruptions.
Understanding the Port Congestion Problem
The world is amidst an ongoing crisis as the container shortage continues. An increasing number of vessels trying to dock and unlock has created a bottleneck in the global supply chain and a trickle-down effect to the end consumer.
Solutions come from an in-depth understanding of the problem. Port congestion isn’t caused by one specific issue. Rather, several delays of the supply chain are all hitting at once, leading to incredible port delays at major ports.
With numerous factors contributing to the problem, it doesn’t have one singular, streamlined solution.
The biggest challenge is related to literal space:
- The imports coming into the US have increased, creating more intake at ports.
- Empty shipping containers are taking up valuable space at ports, giving full containers nowhere to go and offload.
- With no way to offload the goods, the cargo ships are stuck at the ports.
- Incoming cargo ships loaded with goods are stranded outside of the ports, waiting to get in.
- Cargo ships with full containers can’t offload because there’s no space for the empty containers.
- With all these ships in limbo, the port workers are sent home due to lack of work. Even if they could create space to offload, there’s too much of a backlog to accomplish it quickly.
All of these problems are occurring in ports all over the world. Few ports are immune to the backups, giving shippers limited options for where to go or how to keep the supply chain moving.
Solutions for Port Congestion and Ocean Container Shortage
With so many challenges and a vicious circle of delays and congestion, there’s no simple solution to the port congestion crisis. Even with creative solutions, it could take a few years before things return to normal.
Still, solutions can lessen the pressure and minimize the delays and impact. These supply chain issues are unprecedented, so they may require innovative solutions to correct them.
Los Angeles and Long Beach are among the most congested in the country and far above their maximum capacity. Cargo ships are anchored off the coast, waiting to come in.
One of the solutions that major retailers turned to during the holiday season were private charter ships, which were sent to alternative ports.
This may be challenging for some businesses on their own, but with a third-party logistics partner, it’s an option for keeping supplies moving.
Here are some alternative ports on the West Coast:
- Seattle, Washington
- Tacoma, Washington
- Portland, Oregon
- Oakland, California
- San Francisco, California
- San Diego, California
- Vancouver, Canada
The East Coast is dealing with its own congestion issues, particularly in New York, New Jersey, and Miami, Florida. Here are some alternative ports on the coast:
- Savannah, Georgia
- Charleston, South Carolina
- Boston, Massachusetts
- Philadelphia, Pennsylvania
- Baltimore, Maryland
- Norfolk, Virginia
- Jacksonville, Florida
- Palm Beach, Florida
- Port Everglades, Florida
- Wilmington, Delaware
- Wilmington, North Carolina
The Gulf of Mexico also has American ports that can be used, though they may require transloading services:
- New Orleans, Louisiana
- Houston, Texas
- Mobile, Alabama
- Gulfport, Mississippi
Remember, these ports are alternatives for a reason – they may not be equipped to handle large cargo ships. They may be able to offer services for smaller ships, however, and relieve some of the congestion and delays.
In the face of delays, many logistics companies are more willing to use these ports to break up shipments and get goods moving, even if it’s not a one-stop solution to the problem. And with a third-party logistics partner, you have resources and experience at your disposal to find the best solution for port congestion and delays.
The port congestion isn’t just a disruption – it’s frustrating. Full containers with goods are sitting on cargo ships, waiting to be unloaded and sent to their final destinations throughout the country. If everything is stuck at the same port, it can be a huge hit to a business.
One of the best solutions to this problem moving forward is staggering the shipments across different vessels and alternative ports. This way, if one port is experiencing delays, your entire stock isn’t stuck in limbo. You can get some goods into the port, processed, and on its way.
Partnering with a third-party logistics provider that offers customs brokerage services can help with this process. Their entire role is navigating the challenges and obstacles at ports, and with the current delays, that can mean all the difference with getting your cargo moving.
Knowing what obstacles may come up is tantamount to predicting the future, but businesses need to do it all the time. As supply chain disruptions continue and change on a dime, businesses need to be agile and adapt.
To combat delays, businesses should use some forecasting and add lead time when ordering materials or products that are prone to delays. This also applies to booking freight capacity – it’s best to give your logistics partner more lead time to secure your transport.
Remember, logistics companies do this every day, so they can help you with forecasting and plan for delays. Non-perishable items should have as much lead time as possible, and perishable items should have adequate planning to work around delays.
Freight is more fluid and volatile than ever. Have a contingency plan in place that factors in disruptions, rising rates, port delays, and other obstacles to minimize the impact.
You may need to get creative. Perhaps you’re used to ocean freight, but your customers are complaining about delays and long lead times. You can supplement your services with air freight to ensure those clients have their needs met.
Technology is vital to addressing ongoing supply chain issues. Supply chain visibility platforms, electronic logging devices, and control towers allow for better end-to-end supply chain tracking. These technologies aren’t new, but they’ve proven essential during the disruptions of the pandemic and beyond.
Unfortunately, not all logistics providers are on board with supply chain technology. If you don’t have access to a supply chain visibility platform to track your freight’s movement across the supply chain, consider switching to a different partner or investing in your own technology solutions.
The port congestion and container shortage is constantly changing and evolving. Keeping up with the trends and conditions can help you determine the most congested ports and stay aware of new developments and challenges.
Industry publications, news, and other resources can give you vital insights into what’s happening in the supply chain on the global, national, and local levels, giving you valuable tools to prepare yourself and make smart decisions.
We’ve touched on all the benefits of having a third-party logistics partner as the world deals with ongoing port congestion and delays. Regardless of the conditions of the global supply chain, a resourceful, reliable logistics partner is valuable for navigating a volatile market and developing contingency plans to address those disruptions.
Looking to the Future
While conditions may seem overwhelming, the future’s looking brighter. In February, 2022, the Newsom Administration announced that six California sites have been identified and leases have been signed to allow shipping containers to be stored on state property. This is an effort to alleviate congestion at California ports – some of the hardest hit in the country.
The new storage solution is a result of Executive Order N-19-21, which is designed to make national supply chains (and California’s, specifically) more resilient.
At this time, the national warehouse marketplace, Chunker, has leased six sites from the Department of General Services for one year. The option is there for a second year if the supply chain issues continue.
The warehouse marketplace will coordinate between the logistics companies, cargo owners, and California ports to move containers and free space. Hopefully, this will allow ships to offload and anchored ships to come in, ending some of the months-long limbo.
Other actions include doubling the capacity to conduct commercial driving tests to address the national shortage of industry workers, issuing temporary permits to allow trucks to carry increased loads on state and interstate routes between the ports, and securing a pop-up site for storing products and getting them in containers.
The port congestion and ocean container shortages are expected to continue in the near future – and labor shortages even longer – so there’s no better time to include some innovation in your processes. Organizations that take a creative approach to supply chain challenges will not only weather the current conditions more effectively but will be ready for whatever challenges come up down the line.
David L. Buss
David is CEO of DB Schenker USA, a 150 year old leading global freight forwarder and 3PL provider. David Buss is responsible for all P&L aspects in the United States, which is made up of over 7,000 employees located throughout 39 forwarding locations and 55 logistics centers.
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