Importers have noticed that the past four months have seen increasing amounts of congestion in Transpacific ocean freight. I want to emphasize to importers that we are seeing unprecedented congestion in ALL phases of the supply chain.

Origin

• Almost all origin points in Asia are now struggling with extreme equipment shortage (aka: lack of empty containers). Carriers are struggling to bring empty containers back from the United States to Asia to meet the demand for equipment.
• Demand for space is at an all time high. Despite the fact that carrier’s have increased capacity 20% year-on year, the steamship lines cannot keep up with the huge increase in demand. Containers are rolling over from one vessel to the next at extremely high frequency.
• We are noticing that a large percentage of vessels departures are delayed. We believe this is a result of the entire supply chain being bogged down. As vessels are delayed at the destination, their return to Asia is also being delayed.

Ocean Transit

• On the water transit time from Asia to the U.S. is also increasing rapidly. This is primarily due to port delays. Most vessels arriving at U.S. West Coast typically call Los Angeles/Long Beach first. We are seeing vessels anchor outside the port for many days, sometimes even a week, before being worked on. This in turn is delaying vessel transit to other West Coast ports.

Destination

• We want to call out the congestion inside the Los Angeles / Long Beach terminals in particular. Truckers have been warning us about increased congestion for months. However the situation is now reaching full blown crisis proportions. The problem isn’t simply a lack of chassis. There is an extreme shortage of available drivers to handle all the containers at the port. Most drayage companies are booked two weeks out or are simply refusing to accept new container deliveries. Importers need to be prepared for demurrage, extra handling fees, and delays in delivery.
• Containers moving via rail through Vancouver / Prince Rupert have also experienced extreme delays at the port of discharge. WE have seen vessel wait time extend beyond 10 days on a regular basis.

Most importantly, we want to emphasize that we don’t see the situation improving in the coming months. As we continue to see massive demand for space and equipment departing from Asia, we believe this crisis will continue in the coming months. We are staring at the face of the storm.