Off the Rails: Cargo Congestion Creep

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Unlike most years, 2021’s peak season started in June as retail giants Walmart and Amazon desperately try to restock inventory and avoid the trucking, rail, & ocean cargo congestion delays that plague the US west coast. Between rail embargos and empty containers getting preference overloaded export boxes, the new measures many carriers and companies are taking to recover from some of the most severe congestion are measures that experts expect will further complicate the delays they’re fighting. 

The latest delays are coming from UP’s Global IV rail embargo that started last night and will run for 7 days against containers from the west coast ports of Los Angeles, Long Beach, Oakland, and Tacoma. The embargo allows for previously scheduled containers to load but prevents new bookings from taking place for eastbound containers. BNSF also devised a new waiting lot (Lot W) in the midwest for containers to sit between deramping and truck loading. While the containers aren’t accruing storage fees, there won’t be any ability for pickups until they’re moved out of Lot W (anyone else thinks that stands for Wasteland?) and staged for pick up. 

An interesting anecdote to highlight the issues currently at odds in the logistics business – 700 ships were one week or more late calling west coast ports from Asia in the first five months of 2021. Compare that to the 1500 ships one or more week late from 2012 – 2020. It would be interesting to learn how many of those 1500 happened just during 2020 when the disruption started and swelled to epic proportions. 

The situation has become grave enough that the Biden administration signed an EO to investigate ocean and rail companies regarding “a pattern of consolidation that stifles competition”, but there’s little tooth in the order unless shippers step forward to sue the carriers for the delays. Consumers must start the push for punishment in order for the FMC to have authority to effect changes. 

It’s imperative that we at Coppersmith Global Logistics stay updated on the current supply chain disruptions to communicate to our clients. We’re working hard with our long-time carrier partners to keep our client’s cargo moving, but without advance notice and flexibility we’re seeing serious delays. With proper planning and notice, we’re still able to negotiate the best possible bookings and voyages for our clients, but the disruption won’t be over anytime soon. We hope to see rates improve by 2023 but we’re still ready to provide exceptional service during this congestion. Contact your Coppersmith representative today to talk about the solutions we have ready for your cargo.