This is the part of Savannah in Georgia,
the second largest ports on the east coast.
This map shows ship locations tracked by the company.
Marine traffic on August 19,
there was a backup of about 30 container ships.
Similar backlogs have formed at the ports in New York and Hughes.
This is important because it makes life difficult for businesses,
particularly small businesses and it's also important because it helps to keep the cost of
shipping goods high,
which contributes to inflation.
So how did this backlog happen and what's being done to relieve the congestion?
To understand what's happening today on the east and gulf coast,
you have to go all the way back to the beginning of the pandemic when there was first a massive
decrease in the number of goods moving around the world and then an enormous
increase of flood of imports that really hasn't stopped for the last two years.
The worst bottlenecks at U.
S.
Ports have been concentrated at the ports of Los Angeles and Long Beach in southern California,
where earlier this year there was a backup of more than 100 container ships.
This year,
cargo growth has slowed at the southern California ports,
the main U.
S.
Gateway for goods imported from Asia.
But volumes headed into the country through the east and gulf coasts have kept rising.
So retailers and manufacturers had a really really difficult time in
2021 getting all of the goods and the widgets that they needed in order to get
products to the stores.
They were so concerned at the start of this year that they would see similar delays to the ones that
they saw last year,
that they both ordered earlier than they norm and they ordered more than they
normally would.
And because retailers and manufacturers were worried about the ports on the west coast,
they diverted cargo to the ports at new york,
Houston and savannah.
Another reason that shippers are diverting cargo from the west Coast this year is because
there are labor talks between the union that represents about 22,000
dockworkers at all of the ports along the west coast.
Historically,
those talks have been contentious and there have been work slowdowns have
caused significant delays to cargo during the first five months of the year,
the volume of loaded containers reaching the port of new york and New Jersey rose more than 12%
from the comparable period of 2021 according to the Pacific Merchant Shipping Association,
the inbound volume import Houston jumped 24% in that period.
The impact of the congestion at the eastern gulf coast ports is being felt
both by companies that are trying to import goods into the country as well as by
export cargo handling terminals at the ports are so full that they load
and unload ships more slowly,
causing backups at sea on land.
Truckers can't return empty boxes so their yards fill up with containers sitting atop
trailers.
The ports of new york and New Jersey is clogged with about 200,000 empty containers
waiting to be picked up by ocean carriers at the Houston ports,
import boxes are sitting in average of 6 to 7 days,
twice as long as usual.
This isn't so much a failure of the ports.
It's more an illustration of what happens when ports become so overwhelmed
with cargo.
At the end of the day,
the ports only have a finite amount of space,
but porch officials say they are taking steps to try to relieve the congestion.
Many of them have found additional land either within their own ports or
outside of them where they can store extra containers and free up a little bit of
space so that they can move boxes on and off ships more efficiently.
Other officials have talked about charging ocean carriers for empty containers that spent too long at the
ports just like the ports on the West Coast and particularly in southern California.
There's very little in the short term that they can do to alleviate the problem.
For example,
dredging channels and installing Ukraine's.
Those kinds of improvements can take years.
But shipping officials say a slowdown in cargos might be on the horizon because
many importers brought goods in early and because there are significant signs of a
slowdown in consumer spending,
some of the shipping industry executives and officials that I spoke to said
that they expect this year's peak shipping season,
which we're currently in the middle of,
is expected to be a lot softer than it normally is.
Some industry officials are hopeful that in the weeks and months ahead the amount of congestion will
reduce and the bottlenecks will begin to subside at least a little bit.