Port of LA files best September despite lagging exports

The Port of Los Angeles recorded its best September in the gateway’s 114-year history last month. The 888,625 twenty-foot equivalent units (TEUs) processed, a 13.3% year-over-year increase, contributed to the third quarter becoming the single-best quarter on record, with more than 2.7 million TEUs moved.

Port of LA Executive Director Gene Seroka said an average of 900,000 TEUs were moved per month in the third quarter. “It’s a big upswing from what we … were used to seeing in just the first six months of 2020, when we averaged a little bit more than 627,000 TEUs per month. This is about a 30% increase in the run rate we witnessed in the first half of the year.”

As volumes have returned after the height of the coronavirus pandemic, canceled — or blanked — sailings have ebbed.  

“In September we welcomed 97 ship arrivals with no canceled sailings,” Seroka said during a press briefing Wednesday. “We also saw 11 ad hoc — or unscheduled — sailings that were put in motion due to demand.”

He said the Port of LA counted 66 canceled sailings this year through the end of September. To meet rising import demand, there have been 31 ad hoc sailings. “So we’re still only about halfway to recovering from all of those vessel visits that were canceled in the first half of the year.”

Although welcomed, the cargo windfall has created “some supply chain complexities that must be dealt with on a daily basis. We’re working with stakeholders on the challenges that arise from an import surge like this. We’ve seen dwell times increase, longer turn times for our trucks, additional cargo on our tarmacs,” Seroka said.

“We’re busy. You go to LAX the day before Thanksgiving, the airport’s going to be busy, the same for Boston Logan. We don’t have vessel congestion, but what we see are segments that continue to need refinement. These ships are bigger than ever. Our exchange rate … was above 10,800 TEUs per vessel — a record anywhere in the world. It takes time to process that cargo. Now we’re seeing dwell time increase on the street due to COVID-19 requirements.”

He said data from the Port Optimizer and The Signal are now showing stakeholders additional information so they can better plan their assets and staffing. 

The port began sharing The Signal with railroads, chassis providers, truckers, warehouse operators and others in the supply chain last month. Powered by the Port Optimizer, the dashboard shows how many shipments will be arriving at the port and breaks the data down by container type. 

“We’re looking three weeks upstream to see what’s coming at us through The Signal. We have great line of sight on what needs to be trucked out to the Inland Empire, what needs to be trucked to rail facilities and what containers are going to be loaded,” Seroka said.

“We continue to see the replenishment of warehouse and distribution center inventories, along with retailers prepping for year-end holidays. After staying home much of the spring, consumers are buying again. Data from the National Retail Federation suggests that merchants are stocking up in anticipation of an early holiday shopping season,” Seroka said. 

Imports in September totaled 471,795 TEUs, a 17% increase over the same month last year. However, even with the uptick in cargo the last two months, year-to-date 2020 imports are still down 5.1% from 2019, Seroka said. 

September exports totaled 130,297, about flat compared to 2019, he continued. “But this continues a problematic trend. We’ve seen exports drop 22 of the past 23 months. The widening trade deficit created largely by trade tensions between the U.S. and China continues to disrupt the supply chain. 

“Empty containers are also a function of the widening trade gap,” Seroka said, noting that 281,434 empty container units were shipped back to China in September. “This is more than double the amount of loaded exports that were shipped from the Port of Los Angeles in the month.”

In nearly every monthly report, the port chief calls for a correction to the import-export imbalance.

“Regardless of who wins the upcoming elections, our country is in desperate need of a cohesive export plan as well as an infrastructure program and a digitization strategy for ports across the country,” he said Wednesday. 

Despite record-setting numbers in August and September, total volume for 2020 remains down about 9% year-over-year. But Seroka said The Signal data shows October at about 950,000 TEUs and November well above 800,000 TEUs.  

“With September in the books, I’m estimating we’ll come in about 8.9 million TEUs for the calendar year 2020. And if that’s correct, it will be a year-on-year decline of about 4%. Given all that’s happened this year economically worldwide and in the United States, I’ll take that for right now,” he said.  

Port of LA’s Seroka calls for US focus on exports

Port of LA leader calls for industrywide digital transformation

Port of LA gives The Signal to cargo stakeholders

Click for more American Shipper/FreightWaves stories by Senior Editor Kim Link-Wills.