LA/Long Beach Port Supply Chain Recovering With Announcement of New Fee

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Mario Cordero, the executive director of the Port of Long Beach, California, told CNBC’s “Squawk Box” on Wednesday that the twin ports of Long Beach and Los Angeles are making progress in addressing the backlog of cargo ships and containers.

“I think we’re moving forward with some progress and hopefully, as we move into the next six months, we’re going to continue to mitigate the scenario that we’re seeing here,” Cordero said to host Becky Quick.

The twin ports account for roughly 40% of sea freight entering the United States. Fines of $100 a day per container left on the dock, referred to as “Container Dwell Fees,” were announced on Oct. 25 to address the unprecedented backlog.

Carriers would have a maximum of nine days to move containers by truck before fines start accruing and six days if transporting by rail. The twin ports have seen lingering cargo containers reduced by 33% since the announcement, which has yet to be imposed.

During the initial days of the month, there were about 60,000 cargo containers at the ports for over nine days, which would make them subject to a fine, American Shipper data reviewed by Marine Insight showed.

There are still around 61 cargo ships outside the twin ports waiting to unload according to Cordero, which is much lower than the record of 111 on Nov. 11 reported by Insight.

Cordero said in the CNBC interview that more must be done to address the supply chain issue in the future.

“There are truckers, marine terminal operators, warehouses, railroads, and port authorities,” explained Cordero, adding that a lasting solution would entail “a real collaborative effort” from all parties.

A plan from the Biden administration that would have established 24/7 operations at the Port of Los Angeles fell through last month. The port’s executive director, Gene Seroka, announced during a Nov. 16 briefing that they had “24/7 capability,” but a shortage of truck drivers and nighttime warehouse workers, according to The Associated Press.

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