Terminal operators and shipping lines in Los Angeles-Long Beach have begun the task of digging out from the eight-day strike by office clerical workers, but the task may not be as daunting as it was after previous work stoppages — at least not this week.
The consensus among port and terminal operators is that the next two weeks will be quite busy in Southern California, but the ports should dodge the gridlock bullet that could have resulted if the Office Clerical Unit of International Longshore and Warehouse Union Local 63 had remained on strike longer.
Alan McCorkle, managing director of the giant Pier 400 APM terminal in Los Angeles, said Wednesday he hopes to be back to normal in 24 to 48 hours. McCorkle said the diversion of vessels from Southern California to Oakland and Mexico relieved some of the pressure on the ports.
It appears that the containers that were dropped off at the ports of Ensenada and Manzanillo when vessels were diverted to the Mexican ports the past week did not move overland into the U.S. Rather, the containers are still there for carriers to pick them up and return them to Southern California on subsequent voyages.
Ed Zaninelli, vice president of trans-Pacific westbound at OOCL, said vessels that were at berth when the strike began last week will be turned in the next two days. Carriers must reload the ships immediately with exports as well as empty containers that are on hand at the docks. The empties will be needed for the upcoming pre-Chinese New Year rush in the trans-Pacific. “You can’t book to ships that are at dock,” he said.
Two factors were at work that relieved some of the pressure at the ports, said Chris Lytle, executive director at the Port of Long Beach. The peak-shipping season in the eastbound Pacific was over in November, and imports were already beginning to trend lower, Lytle said.
Also, the terminals have been fluid all year, rather than at capacity as they were in 2002 and 2004 when the ports were humming, so the operators should be able to handle the bump in cargo that will occur in the coming weeks. “It will be busy, but clearly not gridlock,” Lytle said.
The Total Terminals International facility where Hanjin Shipping Co. and other carriers call will be especially busy, said Frank Capo, senior vice president and chief commercial officer. TTI will handle ships under three different scenarios — those that were at berth when the strike occurred, those that were diverted to Oakland to drop off Northern California cargo and are now headed back to Long Beach and the normal rotation of vessels due this coming weekend.
Harbor truckers that had been contending with slow turn times long before the strike occurred are concerned that gate times will only increase as trucks flood into the harbor to drop off exports, pick up inbound containers and return empties.
Fred Johring, president of Golden State Express, said his priority was to gather up all of the empty containers that are stored in depots throughout the region and deliver them to the docks immediately. Truckers are paying about $12 a day per empty container for storage. Johring said he hoped to start pulling loads by the second shift on Wednesday.
Marine terminals in Southern California are able to flex up or down as needed under the PierPass extended gates regime that was established in 2005. Terminals this week are adding early and late flex gates, night shifts and weekend shifts, said Bruce Wargo, president of PierPass Inc.
Another factor mitigating the pressure at the ports is that four of the 14 terminals remained open because the OCU workers had signed contracts with employers earlier, or the OCU did not work at the facilities. Since those terminals are fluid, they are able to take on additional ships. Now that the strike is over, carriers are free to divert some ships there if the terminals where they normally call are congested.
Intermodal rail operations should not be severely affected by the strike as the railroads were able to stop some trains before they left the Midwest, while staging other trains that were in transit at various locations in Southern California. Spokespersons for both the Union Pacific and BNSF railroads said they have sufficient locomotives and rail cars in position now that port operations have resumed.
While most terminals are relatively confident right now, the next crunch time could come in 10 days to two weeks as all of the carriers return to normal rotations in the trans-Pacific. The ships should be full as they take on cargo from voyages that were cancelled as well as containers that were dropped off in Mexico and must now be delivered in Los Angeles-Long Beach.