Record Number Of Cargo Ships Are Stuck Outside LA. What Now?

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   Sharlee01posted 2 years ago

   
   Port complex of Los Angeles and Long Beach, already the busiest in the US, has seen a major traffic jam this week, and actually all summer...
   
   Southern California is dealing with a traffic jam unlike any other in their history, as a record number of container ships have been stuck waiting in the waters outside the ports of Los Angeles and Long Beach to unload cargo.
   
   The bottleneck this week at America’s busiest port complex is the result of a shortage of trucks and drivers to pick up goods,  The store selves are getting pretty empty...
   
   76 container ships sitting off the west coast waiting to dock at LA and Long Beach. The ships have been in this log jam for approaching 3 months.
   
   The average container ship has about 14,000 containers
   
   The average value of the merchandise on each container is $100,000
   
   That is a total of $106,400,000,000 of inventory just sitting in limbo, sometimes expiring, often devaluing.
   
   And it’s not just the west coast that is affected. There are similar problems up and down the east coast of New York and Georgia.
   
   This is compounded by astronomical rises in shipping costs. It is estimated that the cost to ship a container from southern China to the west coast of the USA is as much as $20,000, up from $3,000 post-pandemic. That is a rise of over 650%.
   
   And when the goods finally make dry land, there is a shortage of truck drivers to clear the docks, and storage space to put them."
   Source --  https://www.forbes.com/sites/sap/2021/1 … f080255416
   
   What is your opinion on what caused such a crisis?
   
   Do you think the problem will be alleviated in the near future?
   
   Thoughts ---

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      Kyler J Falkposted 2 years agoin reply to this

      I don't think I could even begin to speculate on the root cause of the problems, but I can say that much of the delays seem intentional. A part of me wants to believe that the delays were measured, planned for, and will be corrected. Another part of me wonders whether or not we are heading toward some form of collapse, or multiple forms.
      
      Needless to say, everything feels strange and almost foreboding, but optimism is keeping me pretty grounded. Let's keep our fingers crossed that this episode of clown world ends soon.

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         wildernessposted 2 years agoin reply to this

         I have not researched it and have no idea of it's actually true (although it does ring as true), but I've seen that the biggest problem in LA (biggest dock in the US) is that California is shutting down trucks.  They won't register anything older than 10 years (just getting started for an 18 wheeler) and will shortly require all trucks to be electric.
         
         If (IF) true, that would be a major problem at that dock.  I've also seen Florida advertising that ships should come there as there is no backlog.  Again, I have not researched it, but that, too, could be true.

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            Kyler J Falkposted 2 years agoin reply to this

            With how many companies are offering sign-on bonuses and use of their upgraded fleets, I don't think the older trucks will be falling out of circulation at such a rate we'd be seeing it affect global markets. However, California does have DMV standards that require certain upgrades to vehicles of certain production ages. These upgrades don't seem too over-the-top for your median-earning and above drivers.
            
            A quick read for CA guidelines: https://www.aqmd.gov/docs/default-sourc … f?sfvrsn=8

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               wildernessposted 2 years agoin reply to this

               I don't know, Kyler.  I'm neither a driver nor manufacturer - not even a trucking firm - but having to replace a perfectly good engine in an older truck could easily be " over-the-top for your median-earning and above drivers" according to your link.  That's for trucks entering the docks, which is what we're talking about.

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                  Kyler J Falkposted 2 years agoin reply to this

                  The only real-life example of the situation I have to go off of is my buddy from the Army who drives clearance-grade loads, and he recently dropped $180k on an entire new rig that he can live out of. If he chooses to work year-round, makes his deadlines, and takes on bonus-offered loads, he can make double what he spent by the end of the year at the expense of any free time he could've had. Allegedly, he makes about $0.57 to the dollar of your highest earners in the business.
                  
                  It wouldn't be beyond reason to think the industry is suffering, though, so I agree in that sense. Sign-on bonuses, offering full training with pay, and doing paid advertising 24/7 isn't necessarily the sign of a thriving market. Perhaps it does play a bigger role, and I wonder if anyone is tasked with measuring the amount of drivers who quit versus those who upgrade/buy a new rig?

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         Sharlee01posted 2 years agoin reply to this

         I love your attitude, I hope I catch it... I am keeping my fingers crossed too.

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      CHRIS57posted 2 years agoin reply to this

      This is part of the "broken supply chain" issue. World economy had come to a halt with the pandemic.
      
      When the pandemic set in and economy faltered, producing and consuming entities became cautious. Producers settled for lower demand and produced less. Those normally in need for supplies were also cautious and ordered less. Transport industry also adapted and kept less cargo capacity available (on land, air, water).
      
      Now all tries to resume to normal and the economic engine starts up but stutters. Has the dynamics of stop and go traffic on a congested highway at rush hour.
      
      There are many more indicators for this development. Currently automakers all over the world suffer from a shortage in microchips. So a two ton car can´t be delivered because a tiny part is not available.
      
      And - what you see off shore Los Angeles, all those cargo ships to be unloaded and waiting for nothing - guess what, the cargo capacity is needed somewhere else on this planet and even worsens the situation worldwide.
      
      With reference to some comments: Nothing is planned on a large scale. Or do you think, traffic jams are planned?

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         Kyler J Falkposted 2 years agoin reply to this

         I said planned for, not planned, we intentionally rushed back to the field of commerce. Context is key, friend.

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            CHRIS57posted 2 years agoin reply to this

            Kyler, agreed. "planned for" is like slowing down your car if you know there is a traffic jam 1 mile ahead, no strategical intention, just tactical adaption.
            
            The question is: Do we have a traffic jam (which is gone by nighttime) or do we have a damaged and closed road ahead?
            
            First thought: Just a narrow part of the road ahead, will be freed up after repair.
            
            However for the time being this "road construction" Los Angeles is prominent, but what happens if that obstacle is overcome and the next bottleneck shows up: That bottleneck then called: Cost of energy
            https://www.cnbc.com/2021/10/12/sharp-s … rowth.html
            Looks like the limited flow of goods and services is also dampening the price hike on the energy markets. And that price hike is already affecting economy. We can expand this causal chain ad infinitum...

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               Kyler J Falkposted 2 years agoin reply to this

               Yes, the economic crisis seems to be worsening faster than ever before. I'm starting to feel the energy prices at the pump, though I'm lucky to have an efficient vehicle that dulls it somewhat. I wonder what the plan for the energy crisis is?
               
               I suppose to clear up my sentiments on, "intentional," from earlier, I feel as if certain problems arise from wanting to keep the goose that lays golden eggs alive. This doesn't make my thought process much clearer, it'd take an entire dissertation to lay it out, but putting it concisely:
               
               "These problems have arisen due to deliberately choosing profit over innovation, and we are reaching a point where innovation will become necessity."
               
               I honestly believe that most problems in the world arise due to a focus on profit, pandering to investors rather than taking some quarterly losses for the R&D department. Then again, I'm economically illiterate, and I'm being vague to the point of muddling my own opinions.

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               Sharlee01posted 2 years agoin reply to this

               This situation may get worse due to hundreds of thousands of businesses to include dock and ship workers are bracing for the Biden administration’s rules on Occupational Safety and Health Administration  (OSHA) mandating  Covid vaccination.  Biden has worked his way around to initiate his mandates that will further affect our workforce.  Job openings are at record highs, and it would seem we can't force people to work.  The mandates will further a worker shortage not only at the ports but throughout our workforce. We have a great shortage of truck drivers, which adds to this problem.
               
               I am pro-vaccine, but it is very much evident people can't be forced to take the vaccine.  Those that don't want to be vaccinated have dug in for the duration...   It would appear this is a "Dammed if we do -Dammed if we don't" situation.
               
               https://www.cnbc.com/2021/10/15/busines … suits.html

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      Sharlee01posted 2 years agoin reply to this

      Here is what  Transportation Secretary than Mayor Pete is doing about the problem. Which has been around for many months now...
      
      The media finally ask Buttigieg in a CNN interview what about the supply chain crisis, he used most of the time to plug President Biden’s infrastructure and Build Back Better plans.  He did get around to saying a task force has been set up to fix the problem and he intends to also hold roundtables to solve the problem., and expressed new expanded hours have been ordered by the president to try to get things moving.
      
      IMO, This is another way of saying  "I have no idea how to fix this: But I hope it looks like I do.  I had all but forgotten Mayor Pete was the new Transportation Secretary. I feel like I live in a bizarro world. 
      
      Does this man have any background in Transportation? I see he has a wonderful education.

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         Kyler J Falkposted 2 years agoin reply to this

         Perhaps I put too much faith in our overlords knowing what they're doing, and understanding the consequences of their actions before they take them.

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            Sharlee01posted 2 years agoin reply to this

            I hope hell Pete knows what he is doing...  The shelves at the market this morning were pretty scary...  I asked a worker I have gotten to know over the years. I assumed the problem has been no help to put the stock out. She said for a few months stock is in short supply. How did someone in Washington, I mean anyone not recognize this problem. At this point, another 25 ships are expected at Port of LA in the next three days.
            
            The more research I do the more I have discovered ships have been backed up for many months back as far as March...  Environmentalists are complaining about the increased pollution this problem is causing.
            
            This is going to be a crisis that will be very hard to solve.

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      GA Andersonposted 2 years agoin reply to this

      I went on a walk-about with my friend Google to see what I could learn about this issue. And I learned that I don't think this is a national political issue or that the Biden administration is at fault. Yet.
      
      My perception is that the potential for this problem has been in the works for decades. That there seem to be multiple major contributors to the problem, and that there isn't much the government can do, (excepting some bandaid and red tape actions), to fix it. I think the involved industries; primarily shipping and trucking, are going to have to fix it themselves.
      
      GA

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         Sharlee01posted 2 years agoin reply to this

         Hopefully, I did not imply the shipping backup supply chain problem was Biden's fault.  My OP concentrates on the current problems at the shipping ports.  I have researched a bit on what some feel caused the problem. I found several contributors. It appears there are several causations.
         
         One problem was keeping workers.  The COVID mitigations required sanitizing the heavy equipment at the close of every shift, and workers being dissatisfied with the heavy work. Many workers became ill with COVID and did not return. The shortage of workers seems to be the biggest current problem at this point.
         
         The folks you feel will have to fix it are bracing for another hurdle, that could impact any type of quick fix.
         
         The situation may get worse before they get better, due to port workers and truckers are bracing for the Biden administration’s new rules from Occupational Safety and Health Administration  (OSHA) mandating Covid vaccination.
         
         I agree,  there will be no quick fix to the problem, only get worse. I am more concerned about fixing the problem than what caused it.  Can't imagine if the supply chain slows down further what it will do in regard to inflation.

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            CHRIS57posted 2 years agoin reply to this

            The situation is global.
            
            Just look at the UK and the shortage on truck drivers. And what is amplified in the UK by their Brexit is also happening to a lesser extent in the European Union.
            
            All developed countries have this issue. It is kind of a drawback from keeping economies performing effectively with just in time deliveries..

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      tsmogposted 2 years agoin reply to this

      With the cursory knowledge I have I think GA is right the situation today, though more desperate, was in the making well before the pandemic with its affects as well as the growing issue of vaccine mandates. A quick peek at Google says a shortage of drivers was noted in 2005 with a shortage of 20,000, which is a national figure. I see weekly truck driver school commercials on TV all the time for years now, which to me indicates a demand. Unfortunately the demand for drivers today has been localized to the port problem. 
      
      American Trucking Association at 2019
      
      https://www.trucking.org/news-insights/ … d-forecast

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