Freight volumes on the Port of Oakland decreased 20% in October as ships divert south – CBS San Francisco
OAKLAND (CBS SF) – The Port of Oakland announced that freight volumes fell 20% in October as congestion problems elsewhere caused ships to bypass the Bay Area’s largest port.
The supply chain disruptions affect every aspect of life and business in America. With the ports of Southern California so congested, one might wonder why the Port of Oakland is begging for business? It turns out that Oakland is quiet because the ports in LA are so full.
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Port officials said containerized import volumes fell 14% last month from October 2020 levels, while exports fell 27%. The number of ships decreased by 43% compared to the previous year.
Officials said the declines were due to “crippling delays” in southern California ports, causing companies to divert ships to bypass Oakland and head directly to Asia.
Traffic jams in the Port of Los Angeles and the Port of Long Beach had created enormous backlogs. These two ports alone account for 40% of all shipping containers entering the USA
“Los Angeles is irreplaceable,” said Andrew Hwang, business development manager for the Port of Oakland. “The port of LA is individually the largest port in America. Long Beach harbor is the third largest. “
Hwang said because ships spend so much time in southern California, they don’t have time to sail north to the Bay Area before heading home.
“Because of the delays in Southern California, many shipping companies have chosen to bypass Oakland and head straight back to Asia,” he said.
In response to the bottlenecks, the White House announced last month that it had helped broker an agreement for 24/7 operations in the Port of Los Angeles.
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Meanwhile, the Port of Oakland said it is not currently experiencing the congestion of other U.S. seaports.
While shipping traffic declined in October, officials expected additional arrivals that month, which would be welcomed by exporters.
“Manufacturers shipping goods from Oakland have been hampered by the tight shipping space,” officials said.
“Your normal shipping routes are completely disrupted,” said John Lee, president of Oaklands SW Logistics. “What used to be a short jump to Japan, Korea, China is no longer. Now it’s a confusing three weeks, five weeks. “
Lee said his customers would either have to ship their products to LA for shipping – double or triple the price – or sell them here at home at a heavily discounted price. He said the capacity in the Port of Oakland is simply too small to compete with that in Southern California, who are six to nine times larger.
“It’s like driving a two-lane freeway versus a ten-lane freeway in LA,” said Lee. “There is simply not that much infrastructure here.”
But Hwang said that although fewer ships are arriving, they are carrying a lot more cargo. He said they are loading and unloading 50 percent more on each ship than they used to be. Oakland Port officials say business is slowly growing and they expect to see further improvements in the spring.
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However, Lee said he believes that while the port of Oakland remains in a bottleneck in Southern California, it will be viewed as a detour that shippers cannot afford, and that the exports produced here will have a hard time getting to market . Oakland discovers that in the complex web of the supply chain economy, size matters.