“I think they will trade Trey Lance to Tennessee

Anchorages continue to fill with waiting container ships off East and Gulf Coast ports, where vessel queues have now far outgrown those off the West Coast. Along all three coasts combined, the number of waiting container vessels remains exceptionally high.

There were 125 container ships waiting off North American ports

That’s down 16% from 150 waiting ships in January, when West Coast congestion peaked, but up 36% from 92 ships a month ago.

The two ports said last Friday that the fee would be delayed again due to a combined 31% drop in aging containers since late October. But if you run the numbers with a different start date you’ll get a very different picture.The combined number of import containers at both ports dwelling for nine days or more has more than doubled since early February, to 48,932 as of Wednesday.

This is almost exactly the number of containers dwelling on Los Angeles and Long Beach on Nov. 15 (48,905), back on the day the fee plan was originally to be implemented.

As of Wednesday, Long Beach had 8,992 containers on its terminals for nine days or more on the trucking side, and 11,509 on the rail side, for a total of 20,501. Long Beach pointed out that this is down 22% versus Oct. 28, when it began compiling the numbers.

The California Trucking Association’s challenge to the law in the Bonta case has failed and sets the stage for California’s AB5 to disqualify many current independent contractor drivers and owner-operators from being classified as independent contractors.

AB5, in short, is the common name for California’s codification of its unforgiving ABC test, which is used to determine whether workers are properly classified as employees or independent contractors. The ABC test, adopted by the California courts first in Dynamex Operations W. v. Superior Court and later expanded and codified by the California Legislature as AB5, presumes that a worker is an employee (and not an independent contractor) unless the hiring entity can prove that the worker:​(A) Is free from the control and direction of the employer in performing work, both practically and in any contractual agreement. ​(B) Performs work that is outside the usual course of the employer’s business.​(C) Is usually engaged in an independently established trade, occupation or business of the same nature as the work performed for the employer.​Truckers must show its independent contractors perform work outside of being a motor carrier, which is practically impossible

Supply chain costs that hit new highs in 2021 are not likely to drop in 2022 as rising interest rates, historically high fuel prices, and inventory carrying costs keep pressure on the budgets of US shippers. Those costs are countering softening spot and contract transportation rates, speakers said Tuesday at the launch of the 2022 Council of Supply Chain Management Professionals (CSCMP) State of Logistics report.

Ulta Beauty revamped its trucking portfolio a few years ago, changing its procurement process. In a major change, “the annual RFP [request for proposal] is kind of dead,” Kobus said. The retailer replaced annual bids with a “continuous bidding process” for its lanes and business, she said. Kobus believes more shippers will move in that direction and make greater use of short-term mini-bids.

“There’s no return to normalcy,” said Paul Bingham, director of transportation consulting at S&P Global Market Intelligence. There have been “structural shifts” in the US economy that won’t snap back to pre-pandemic conditions, he said. Those shifts include a significant increase in inventory carrying costs; those costs rose 29.5 percent last year to $501.3 billion and are headed higher as interest rates rise. S&P Global is the parent company of JOC.com.

Ocean carriers are skipping some calls to Canada and the US East Coast and shifting arrival dates in June as North American port congestion and delays force liners to rework schedules. Mediterranean Shipping Co. said in a Monday schedule update that its Eagle service from Asia, which 2M Alliance partner Maersk offers as its TP1 service, will not call Canada’s Prince Rupert and Vancouver ports during the second and fourth week of June.

The decision to omit Canada calls comes as the marine terminals at Prince Rupert and Vancouver are now “full,” according to a Canadian port executive who spoke at the JOC’s Canada Trade and Shipping Outlook conference last week. Both ports are hitting their capacity limits as shippers look for alternative import gateways should contract renewal talks between US West Coast maritime employers and longshore labor hit a snag.

As a hedge against the potential for terminal disruptions linked to the talks, shippers have been diverting more cargo to the US East Coast. But those added volumes are straining ports. The Port of New York and New Jersey said an average of 18 ships were at anchor daily as of last week, waiting for a berth space to open as Asian freight volumes surge. MSC had earlier omitted US East Coast port calls for the Empire service and the Emerald/TP16 service for one week each in June.

Harbor truckers are warning of almost a 30 percent drop in truck capacity in California’s container ports come Jan. 1, 2023, when a state mandate allowing only 2010 or newer model-year trucks at their marine terminals takes effect.

Matt Schrap, CEO of the Harbor Trucking Association, said about 28 percent of the approximately 20,000 trucks in the Los Angeles-Long Beach drayage truck registry (DTR) will be older than 2010 model year.

The ports of Los Angeles and Long Beach on April 1 began assessing a fee, known as the clean truck fund rate, of $10 per TEU on moves by non-zero-emission (ZE) trucks, which at present is virtually all container moves in the harbor. The proceeds will go back to the industry in the form of subsidies to truckers for the purchase of electric or battery-powered trucks, and for construction of charging stations and related infrastructure.

Spot dray rates from Savannah to Atlanta, which exceeded $2,500 per container last November, are now between $1,500 and $2,000, according to Hilsenbeck and truck fleet executives.

“We’re at that point where the small guys aren't getting the rates or the number of loads that they were getting before and their cash flow is tight because of high diesel rates,” Hilsenbeck said. “I'm seeing these agencies expand, agents who are acquiring owner-operators. So, it feels like we're on the verge of that fragmentation we saw [in late 2021] turning back into consolidation.” That shift coincides with a decline in Savannah’s laden import volume, which fell 13 percent in February from January and another 2.3 percent in March, according to PIERS, a sister product of JOC.com within IHS Markit, now part of S&P Global. Laden imports were up only 1 percent in the first quarter compared with Q1 2021 and were down 5.8 percent compared with the fourth quarter.

“In Savannah, I have 27 drivers in the pipeline to come back and eight of those are former drivers and probably four or five of them left to get their own authority; the rest left to go to another carrier,” the source said. “Even the drivers who haven't pulled the trigger to lease back on with us have been calling saying, ‘Hey, I need freight. I can't find work anywhere.”

But if US West Coast ports experience any disruptions after the coastwide contract between the International Longshore and Warehouse Union and the Pacific Maritime Association expires on July 1 and importers seek a relief valve at the Canadian ports, “There is no capacity for that spillover,” Mihic said. Indeed, a May 6 advisory from Maersk Line to its customers said the Vancouver Fraser Port Authority is operating at 100 percent yard utilization and Prince Rupert at 113 percent. A rule of thumb in the marine terminal industry is that after a container terminal reaches 80 percent utilization, there is no buffer to handle cargo surges, and operations deteriorate.