Entire US Supply Chain Requires Around-the-Clock Operations to Fix Port Delays and Costs

Entire US Supply Chain Requires Around-the-Clock Operations to Fix Port Delays and Costs
Truckers move shipping containers out of the Port of Long Beach, Calif., on July 13, 2022. (John Fredricks/The Epoch Times)
Bryan Jung
The entire U.S. supply chain, not just its ports, requires 24/7 operations to reduce logjams and out-of-control costs, said U.S. Army Gen. Stephen Lyons (Ret.), the White House supply-chain czar, in an interview with Port of Long Beach Executive Director Mario Cordero on Aug. 9.

Lyons, the former commander of the U.S. Transportation Command, took over the position, on May 27, from John D. Porcari, who was appointed by the Biden administration as the port and supply chain envoy.

“If only you or only a terminal goes to 24/7, that’s interesting,” said Gen. Lyons to Port of Long Beach Executive Mario Cordero in the interview.

“But if everybody—including the warehousing community, all the other modes of transport—moved to 24/7, or something more than today, that makes logical sense that you could move much more cargo in the same period of time.”

Cordero has been a big proponent of adopting around-the-clock operations for California’s ports, similar to what most of the other important maritime hubs in developed countries have done.

For the last two and a half years, California’s two major ports of Los Angeles and Long Beach have been stuck with a lingering supply-chain crisis.

Long Beach and Los Angeles are responsible for about 42 percent of all U.S. containerized trade with East Asia.

Last year, the two ports opened 24-hour longshore operations and extended gate hours for truckers.

Labor Costs and Efficiency

Meanwhile, Lyons has been dealing with ongoing labor negotiations and trucker protests by independent truck drivers over California’s controversial AB 5 law.

The California Trucking Association says that the law will reclassify an estimated 70,000 independent owner-operators to “trucking company employees,” which will cut into their livelihoods.

Truck drivers staged protests against the new law at port facilities in Los Angeles and Long Beach last month.

Lyons said that expanded gate hours could result from the arduous labor-contract negotiations between the International Longshore and Warehouse Union and the Pacific Maritime Association.

The general believes that longer hours and more fluid operations are the key to improving the movement of cargo.

“It’s all about restoring consumer confidence and bringing costs down,” said Lyons. “What we want to do is move in that direction.”

While backlogs have somewhat eased since late 2021, 24-hour container operations at major American port terminals still remain scarce, reducing efficiency standards relative to their global rivals.

The two Californian port facilities were at the bottom rank of the World Bank and S&P Global Market Intelligence’s 370-member Container Port Performance Index for 2021.

A majority of key U.S. seaports—such as Savannah, Georgia; Oakland, California; as well as ones in New York and New Jersey—also rank in the bottom half of the list.

Maritime transport moves more than 80 percent of global merchandise by volume.

The U.S. Department of Transportation announced, on Aug. 10, a new supply-chain pilot data-sharing project aimed at easing bottlenecks at congested U.S. ports, which has begun exchanging data and has doubled in size.

The project, known as the Freight Logistics Optimization Works (FLOW) program, was launched in March with 18 initial participants, including truckers, shippers, wholesalers, ocean carriers, retailers, and ports in order “to develop a digital tool that gives companies information on the condition of a node or region in the supply chain.”

The department will discuss initial secure data sharing with the group, which has now expanded to 36 participants.

The National Retail Federation said, on Aug. 8, that imports at major U.S. container ports are expected to slow significantly for the remainder of 2022, but should still see a net gain over 2021.

“Lower volumes may help ease congestion at some ports, but others are still seeing backups, and global supply-chain challenges are far from over,” said the NRF.

Reuters has contributed to this report.
Bryan S. Jung is a native and resident of New York City with a background in politics and the legal industry. He graduated from Binghamton University.
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