LA, Long Beach Terminal Operators in Overdrive

Marine Terminal Operators (MTOs) at the Ports of Los Angeles and Long Beach in November continued to work additional shifts to alleviate recent congestion. MTOs operated 118 additional gates (shifts open to truck traffic) in November, a 55% increase over the 213 OffPeak gates originally scheduled for the month, according to PierPass.

The MTOs have been spending USD 3 million per week on additional and unbudgeted costs since September 1 to manage congestion. In addition to adding unscheduled gates and shifts, terminals have been working overtime and through lunch and breaks, and paying truckers to move containers between terminals to load on-dock trains.

PierPass, a not-for-profit company created by marine terminal operators at the ports of Los Angeles and Long Beach in 2005 to address multi-terminal issues such as congestion, security and air quality, reported these initiatives to the five Federal Maritime Commissioners (including Chairman Mario Cordero), briefing them on measures the marine terminal operator (MTO) members of PierPass are taking to address the current congestion issues in the Ports of Los Angeles and Long Beach.

PierPass also shared new initiatives its members are deploying to address chassis availability issues and to expand container delivery options to increase terminal productivity. These initiatives include the Free-Flow Program, which pre-positions large blocks of containers to enable quicker turn times for trucks picking up containers headed for a common destination.

The FMC recently issued an update on the proposed congestion surcharges, saying that the 15 ocean carrier members of the Transpacific Stabilization Agreement have individually committed to forego imposition of any port congestion surcharges until 2015.

The Federal Maritime Commission has received numerous inquiries regarding congestion surcharges for “labor unrest” as announced in various ocean carriers’ tariff rules required to be published under the Shipping Act and the Commission’s regulations.

On November 17, the Commission announced that it was collecting information regarding congestion surcharge rules published in carrier tariffs and undertaking a review. Ocean carriers in the transpacific trades were asked to respond to Commission inquiries into the timing and legal sufficiency of the surcharges, and all carriers timely responded.

During the week of November 24, following the FCS’s inquiries, many carriers announced temporary suspension of the surcharge.

The FMC Chairman Mario Corderosaid:“I welcome the individual commitments of the ocean carriers to postpone port congestion surcharges into 2015. During this time, Commission staff will further address with the carriers our concerns for the lawfulness, fairness, and adequacy of notice of implementation. The carriers’ commitment to defer the congestion surcharge offers the opportunity to continue this important dialogue and pursue greater transparency as to the timing and the need for future carrier surcharges. The monitoring by Commission staff of port congestion and related surcharges will continue.”

Press Release; Image: POLB