San Francisco The slump comes as a surprise: While container shipping in the USA experienced a great boom in the run-up to Christmas and there was a shortage of goods in retail, the port of Oakland near San Francisco in California reported 14 percent lower imports and even 27 percent fewer exports for October than in the previous year . The freight volume fell by a total of 20 percent, the number of ships entering the port by 43 percent to around 60.
For the first ten months of 2021, the total freight volume of two percent was still slightly above the previous year’s figure. But before Christmas, yawning empty loading terminals dominate the picture. Danny Wan, Executive Director of the Oakland Port and President of the California Ports Association, said, “The operator of one of the terminals told me that for the first time since they have been in Oakland, there will be none in a month only ship wanted to enter, “he told the AP news agency.
At the joint bay of the two important freight ports in Long Beach and Los Angeles, the container ships wait for weeks to enter, in the meantime there have been around 100. The freighters usually head for California’s third largest port in Oakland before they return to China. In order to make up for the delays in entering the larger ports of California, the stop in Oakland is being canceled more and more often. Now, “the ships just pass us,” says Wan.
Until June there were long waiting times here too, mainly because there was a shortage of workers. The dock workers who were newly hired at the time now have hardly anything to do. After all, according to Wan in Oakland today there are no more backlogs. He is campaigning aggressively for customers, especially operators of direct routes from Asia – bypassing the other two ports in California.
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The sea in front of the third largest port in Oakland is calm and empty. One of the problems facing the port is the new structure of freight rates. It is now billed according to time instead of just according to the number or weight of the containers, as was the case in the past. A giant container can quickly cost $ 140,000 a day. That must bring the freight customers together. They save money when a ship then passes Oakland at top speed and arrives in China three or four days earlier.
The trailblazer Oakland is falling behind
The Port of Oakland has a long history. After the freight traffic was spun off from San Francisco, a steady growth began. In the 1960s, Oakland was the first US West Coast port ever to build capacity for the then new container ships. At the end of the 1960s, Oakland temporarily had the second largest container port in the world.
But other ports caught up aggressively and soon overtook the port of San Francisco Bay: The port of Long Beach, for example, is around nine times the size of Oakland today. This is also due to its own inertia: Compared to other world ports, Oakland is considered technologically backward. According to international studies, new, robot-controlled cranes work noticeably faster than those in Oakland and many other US ports, where the cranes are still partly controlled by hand. This is fatal when customers pay by the hour for their deliveries.
In September 2021, only 54 ships docked in Oakland, as few as since 2015.
The lack of customers also has consequences for the local economy. California is about the largest producer of nuts such as almonds, walnuts and pistachios in the USA, the export value is around eight billion dollars annually. If the container ships stay away, the manufacturers cannot deliver their goods.
Roger Isom, President of the Californian Agriculture Association CCGGA, gives an example: In October, almost 80 percent of all delivery trips from Oakland that had already been booked were simply canceled by the shipping companies. Some of the goods had to be brought to Texas by train or expensive by plane so that important delivery dates for loyal customers could be met.
Some ship operators are therefore already setting up new lines that offer direct connections from Oakland to China. The traffic jams in front of the other ports are still not resolving, the global supply chain problems could continue into the new year. The port management therefore hopes to be able to fill a gap and expects a slight recovery in November, combined with the hope that the trend will continue. After all, four modern and significantly larger container cranes should soon noticeably accelerate loading processes in Oakland. One is already in operation. It wasn’t until 2019 that the old diesel-powered cranes were taken out of service.
There is a lack of investment of $ 163 billion
Not only the containers but also the investments are stowed in the ports. The Association of American Civil Engineers (ASCE) gives the more than 300 US coastal and inland ports an average B– in school grades, with A + being the best rating. The engineers put the investment backlog at $ 163 billion by 2025. In addition, there are more than twelve billion dollars in public investments just to maintain the water-side infrastructure. But for them there is not even a firm funding commitment from Washington.
And the problems don’t stop at the ports: only nine percent of all traffic connections to US ports are rated as “good” or “very good” by the ASCE. The containers often have to be transported over holey roads and old rails. The American disease, unwillingness to invest in public infrastructure, is catching up with the economy.
In any case, President Joe Biden’s gigantic infrastructure program will come too late for this year’s Christmas season. He can only warn that many retail shelves will remain empty.
More: China wants to get the supply chain problem under control with a merger of five companies