Since 2019, shippers throughout the supply chain have faced consistent slowdowns at ports around the globe. Who can forget the dramatic images of congested Southern California ports in late 2021, involving hundreds of ships at a time? Today, such port slowdowns are relatively minor by comparison, yet they are persistent and continue to wreak havoc on global supply chains. Shippers have no choice but to adapt to a "new normal" in their logistics operations.
"The current congestion, not only the ports but also the landside infrastructure, will be there at least till Q1 2023," Peter Sundara, head of global ocean freight product for Visy Industries, told Reuters in June. With peak season fast approaching and no end to port-side difficulties in sight, shippers are searching for solutions and strategies to cope with their new reality.
Increasingly, shippers are implementing container tracking software solutions to improve container visibility at the port and beyond. With improved container visibility through real-time container tracking software, shippers can predict port-side slowdowns before they disrupt operations.
Causes of Port-Side Slowdowns
With overburdened shippers in mind, we’ve gathered three leading causes behind persistent port congestion and the must-know solutions helping savvy shippers streamline their supply chain for a volatile ocean shipping environment.
Continued COVID Complications
Early in the summer of 2022, following a massive surge of COVID-19 infections within China, the Port of Shanghai, the largest in the world at 43.5 million annual TEU, was forced by pandemic restrictions to reduce operations drastically. While this shutdown was mainly contained to China, it significantly affected U.S. West Coast ports, most of which specialize in trade with Asian Markets.
Ocean shipping and supply expert Jon Monroe told FreightWaves that It’s probably worse than Wuhan. “You’re going to have a lot of pent-up orders. It’s going to be an overwhelming movement of goods.” While the Shanghai slowdown eventually passed, it remains a reminder that the lingering effects of the COVID-19 Pandemic can still roil the global supply chain.
Although the worst of the COVID pandemic seems to be behind the logistics industry, shippers remain nervous about the potential for future shutdowns. For shippers, port shutdowns can mean millions of dollars in lost revenue, not to mention the staggering costs of freight reallocation and routing management.
For slowdown-wary shippers, improved container visibility in real time can provide the insights and answers they need to survive the ongoing COVID-driven disuptions. Container visibility, delivered through an API (Application Programming Interface) equipped container tracking software platform, gives shippers access to standardized data, showing which ports are experiencing the worst slowdowns due to unexpected COVID outbreaks. Once standardized data and container tracking software have revealed lapses in performance, integrated API and TMS (Transportation Management System) enable shippers to make the on-the-go decisions necessary to survive and thrive in a COVID-rattled supply chain.
Lack of Labor
Although the turnover rate among warehouse employees lowered to 49% in 2021 from a staggering 60% in 2020, severe labor issues persist in the logistics industry. Three-fourths of light industrial businesses entered 2022 not fully prepared and have struggled to keep pace with demand. With another chaotic peak shipping season upon us, shippers are increasingly nervous to see what labor-shortage-stricken ports will offer the global supply chain.
However, shippers don't need to wait for the heights of peak season to see the consequences of labor shortages affecting performance at ports. In August of this year, as the freight railroad industry struggled to cope with a 20% employee loss over three years, ports became congested with rail-bound containers. In an interview with CBS News, Gene Seroka, Port Director at the Port of Los Angeles, said about 35,000 containers designated for rail sat at the docks and that a typical day looks more like 9,000 units. These stresses at port contribute to a slower offloading time for incoming shipments, meaning ships can spend costly days idling outside the port, a stark shift from pre-pandemic days when ships rarely had to wait for a berth.
Today, some tech-savvy shippers are implementing container-tracking solutions to solve the many problems caused by persistent labor shortages. Shippers can easily communicate across logistics channels through the easy integration of a container tracking API into an existing tech stack. With streamlined communication and improved container visibility, operations centers are better equipped to handle labor shortages and ensure that logistics partners at every stage of the supply chain are ready to receive shipments. Integrated rail container visibility, offered as part of a container tracking software platform, ensures that multimodal operations stay seamless, regardless of what an unpredictable labor landscape throws at logistics professionals.
Unexpected Equipment Shortages
It’s not just a labor shortage that’s riling port-side supply chains; port-side equipment shortages are an increasingly common cause behind lengthy dwell times and often leave shippers with little recourse but to wait for equipment to become available.
The chassis is among the pieces of equipment hit hardest by the ongoing equipment shortage. Used to haul containers from one location to another, chassis are an often underappreciated but entirely vital component of any logistics enterprise. According to the Journal of Commerce, “North American chassis manufacturers have run into production delays in 2022 for the second consecutive year, slowed by difficulties in sourcing raw components and retaining factory workers, which means widespread shortages of marine chassis may persist until 2024.” Without chassis to transport containers, ports are helpless to load containers onto multimodal transportation assets, and shippers have little choice but to watch as dwell times skyrocket.
While shippers can do little to speed the arrival of new chassis, some are using innovative global container tracking technology to improve container visibility throughout their supply chain, ensuring that equipment shortages don’t impact customer satisfaction. With a cloud-based container tracking solution, shippers can send automated exception alerts throughout their supply chain, ensuring that everyone — from manufacturers to end customers — stays up-to-date with delays from equipment shortages, labor, or whatever else an increasingly complex logistics industry has to offer. With container tracking from an experienced, API-enabled container visibility provider, shippers can offer their customers the best visibility.
Face the New Normal Head-On: Partner with OpenTrack Today
To the dismay of ocean freight shippers, port-side slowdowns are here to stay. However, as the global logistics industry comes to terms with the new normal, shippers are implementing innovative software solutions. By implementing container visibility solutions through a reputable, experienced container tracking visibility partner, shippers access the standardized data, end-to-end supply chain communication, and cloud-based exception alerts needed to remain competitive in a high-stakes logistics marketplace. Book a demo with OpenTrack today, and see what container visibility made simple can do for your business.
