The ports of Long Beach and Los Angeles managed to increase their container volumes slightly in 2012 from a weak 2011, but the total of about 14.1 million 20-foot-equivalent units was well below the 15.8 million TEUs the port complex handled in its peak year of 2006.
The meager performance highlights the lingering impact of the 2008-09 recession. It also reflects increased competition from East Coast ports and Prince Rupert, British Columbia, all of which have been eating into the market share of North America’s largest container complex.
Prince Rupert, which opened its Fairview Container Terminal in October 2007, handled about 550,000 TEUs in 2012. About two-thirds of that container traffic moved to or from the U.S. Midwest and mid-South, which are prime markets for the Southern California ports.
East Coast ports have been gradually increasing market share in the Asia-U.S. trade since the employer lockout of International Longshore and Warehouse Union dockworkers during the 2002 contract negotiations. East Coast ports are deepening their harbors in anticipation of completion of the Panama Canal expansion project in 2015, although bigger ships are already calling at East Coast ports via the Suez Canal route.
The past year has been unusually turbulent for U.S. ports. The International Longshoremen’s Association contract at East and Gulf Coast ports was originally set to expire on Sept. 30. The ILA threatened to strike as the deadline approached, and conditions at East and Gulf Coast ports have remained unsettled as the contract was extended twice. Negotiations with waterfront employers are continuing.
The uncertainty surrounding the ILA contract negotiations resulted in some diversion of cargo to West Coast ports. However, the Office Clerical Unit of ILWU Local 63 in Los Angeles-Long Beach struck the Southern California ports for eight days beginning in late November, resulting in a diversion of some cargo to other ports and inhibiting further gains.