It can almost be guaranteed that everyone at least once in their life has thought “where in the world is my cargo?” when expecting a consignment that hasn’t arrived yet, however, with the shipping industry the way it currently is you might be waiting a bit longer than usual. The shipping industry has been hit with a number of things including: high demand, severe port congestion, industrial action, port closures due to COVID, lack of equipment and staff, the highest rates ever seen in the industry, plus lockdowns around the globe, and it isn’t certain if the industry will ever revert back to pre-pandemic levels.
A Domino Effect
A domino effect can be seen in supply chains worldwide, with disruptions in one location resulting in significant delays and congestion elsewhere on the planet. The pandemic has highlighted the fragility of this interconnected system, and in recent months there have been unprecedented levels of congestion in ports across Europe and the Americas.
This congestion is causing a drop in schedule performance worldwide because when the ships are waiting to berth in one place, this waiting time then pushes the whole schedule for that vessel back, and when that vessel does eventually get unloaded/loaded and continue its voyage, it is not guaranteed the next port has a berthing window available leading to more waiting time for the vessel until the port berth is ready.
Increase in Wait Times for Ships to Discharge Cargo
Approximately 65 vessels are at anchor in San Pedro Bay (off the Coast of California) waiting for slots to discharge their cargo. The pile-up brought the average wait time for ships at the port berth to 8.7 days, up from 6.2 days in mid-August. The ship waiting the longest arrived on 23 August. Before COVID, it would be unusual to see more than one to wait for a berth.
Gene Seroka, head of the Port of LA, warned that a “significant volume” of cargo was “headed our way throughout this year and into 2022”.
“We continue to monitor a host of variables; disruptions continue at every node in the supply chain,” he said.
As economies recover around the globe this means the demand for goods have increased with retailers and manufacturers rushing to place orders and restock inventories; which the shipping industry is struggling to keep up with.
By one estimate door-to-door transit times from China to the US using container vessels have reached 71 days, compared to 40 days two years ago.
It is unsure of when the shipping industry will (or can) revert back to what it was before the pandemic as forthcoming national holidays and festivals in China are set to take place shortly, plus Christmas being just around the corner will place even more pressure on an already fragile supply chain.