Supply chain shortages continue to be the norm in today’s economy. Unfortunately, the efforts to overcome disparities and shortages arising from the pandemic have created massive backlogs at many major ports. However, there is hope on the horizon as major retailers look to curb total supply chain costs in anticipation of potential fines for excess idle time. Furthermore, additional operating hours at ports are helping to avoid issues on both sides of the country. According to Maritime Executive, “The Georgia Ports Authority is reporting an initial success at clearing some of the containership congestion at the Port of Savannah while the port also recorded its first-ever month handling more than 500,000 TEU.” Let’s take a closer look at what’s happening and how it will impact port operations and port drayage in your supply chain.
Major Companies Move to Increase Overnight Activity to Lessen Impact of Logjams on Port Operations
As part of the current administration's plans to reduce the congestion at major ports, port authorities have extended operating hours. In recent weeks, the ports of Long Beach and Los Angeles went to 24/7 operations. Individual terminal operators have committed to adequately staffing the ports around the clock, but around-the-clock operations come with a caveat. Unless retailers and transportation service providers can successfully increase the streets moving out of these ports, it will do little good. As a result, major companies have made significant strides and commitments to increase overnight activity to lessen the impact of such backlogs.
While also moving to increase throughput,Target went to 24/7 operations years ago, according to Newsbreak. However, this is the first time multiple prominent retailers have joined Target in increasing overnight activity. And the list of companies appears to be growing. As reported by Forbes, Walmart, Target, Home Depot, FedEx and Target have now increased their commitments to nighttime operations to reduce the port backlogs plaguing terminals.
Port Authorities Had Previously Announced Extended Hours and New Fines.
There is a growing consensus that moving more freight out of ports will help ease the Port backlog, requiring increased use of dual transactions. However, port authorities realize there is a finite amount of capacity within the industry. Port authorities previously announced new fines designed to encourage shippers to move their freight faster and avoid delays.This came on the heels of additional port operating hours, and it signaled that port authorities are still enduring troubling times. However, even around-the-clock operations come with challenges.
As noted by Talk Business, “the ports plan to double daytime drayage fees between Dec. 1 and Jan. 31 to encourage the use of their extended hours. But the analysts noted that the port bottleneck is in labor, not hours. They said the issue could be worse at night, with fewer available workers, including crane operators, longshoremen and warehouse labor, leading to slower turn times.” Thus, shippers need to consider how such delays will put even greater pressure on drayage efficiency.
How It Amounts to Added Pressure on Port Drayage and Use of Dual Transactions
Increased dock activity naturally implies added need for drayage service. And like all forms of drayage, the turn time is critical to moving more freight out of ports and getting empty containers back. That’s the fundamental basis of dual transactions too.
Take a full container, do it quickly, and return with an empty container. Unfortunately, failure to complete short-haul drays and streamline the unloading process results in fewer chassis available to move goods from the port overnight. There are also complications when freight needs to be deconsolidated before drayage. Still, the dray could be planned to account for the deconsolidation of FCL into smaller LCL shipments sent via LTL.
Such deconsolidation might be best compared to steps typical of hub injection, creating new ways to avoid delays and getting more accomplished overnight at a distribution center closer to ports but not at the port itself. Still, the major retailers are pushing full steam ahead as peak pressures mount, which means port operations will need to grow more efficiently to keep everything at bay.
Improve Drayage Efficiency and Productivity With Port City Logistics
Port drayage efficiency is the source of savings that the major retailers are targeting, and it will help reduce the massive backlogs at today’s ports. Part of that includes choosing a port drayage provider with ample warehousing to decrease turn times and move more freight. Port City Logistics is the partner that can turn the ideal into reality. Connect with Port City Logistics to reduce your risk of port cargo delays and fines today.