A chain of events impacting U.S. goods has dozens of shipping containers waiting to dock in Los Angeles. In fact, there are 62 ships waiting currently. Dotted in drift areas of the Pacific Ocean, a photo captured the mess of cargo ships. The massive influx is a result of both increased buying and a labor shortage brought on by the pandemic.
Further, the Ports of Los Angeles and Long Beach account for 40% of U.S. goods shipped throughout the country. However, the problem doesn’t just lie with bored crew members waiting to unload their goods in order to return home. It’s a chain of events that will affect every consumer in the country. For example, Costco will begin monitoring its toilet paper, paper towel and bottled water sales. This is just one effect of the ordeal.
Ahead of a busy holiday season, retailers are stockpiling their inventory. This means ordering large amounts of product from overseas. Los Angeles is the main port for goods shipped from China. As the world seeps back into a normal purchasing routine post-pandemic, the labor force isn’t ready for it.
They’re operating at a 65% capacity when the demand is 100%. This means re-routing, hiring third-party transportation services and charging more for their product. Which then charges you more.
Addressing Backed-Up Ship Crisis
Officials are now pulling their resources together to alleviate the problem. One potential solution is a pilot program which would operate the port round the clock, albeit bringing in most ships during non-peak hours.
“We are in the midst of an historic surge in cargo, and our terminal operators and other supply chain partners are giving their all to keep it all moving,” Port of Long Beach Executive Director Mario Cordero said in a statement, according to The Daily Mail. “We welcome this pilot project by TTI as a first step toward extending gates to 24/7 operations, and we encourage our cargo owners and trucking partners to give this innovative program a try.”
One major company also grappling with solutions for this debacle is FedEx. As nearly 600,000 packages a day are re-routing through other channels, the company is losing money, and quickly. This, in turn, spikes consumer prices.
Raj Subramaniam, chief operating officer at FedEx, said the company is facing “widespread inefficiencies” due to these alternate methods of routing products.
Essentially, until the supply-and-demand of the holidays alleviates and the labor force is bolstered, people can expect limited product and increased pricing (this also includes groceries and other holiday food items). If you’re attempting to buy those Christmas gifts? The earlier the better. Shipping times are also delayed.