The number of shipments passing through the nation’s busiest container port complex in Los Angeles has increased significantly from the first half of the year, reflecting a recovery in business and a shift in consumer habits.
Port of Los Angeles Executive Director Gene Seroka said in an appearance on CNBC Monday that cargo volume increased 50% in the second half of 2020 from what arrived at the docks in the first six months of the year, and it is common for loaded ships to anchor at sea waiting for a dock to open.
“It’s all the change in the American consumer,” Seroka said on “Power Lunch.” “We don’t buy services, we buy goods.”
The increase in shipments has put pressure on the supply chain in the seaport, which is managed by the Los Angeles Port Department. It’s in stark contrast to spring when volumes plummeted as the coronavirus pandemic sent global economies into recession.
With retailers seeing a spike in online ordering and e-commerce in the stay-at-home world, this has resulted in significant delays in ship unloading at ports across the country and a scarcity of desired warehouse space.
Seroka said the port expected the increase in demand. The Southern California port has been North America’s busiest container port for the past two decades, receiving 17% of all U.S. cargo.
In November, the Port of Los Angeles registered 890,000 20-foot-equivalent units of shipments passing through its facilities, a 22% increase from the same month a year earlier, made possible in part by vacation orders. Imports from Asia have reached record levels, according to the port authority. Meanwhile, exports at the port have declined in 23 of the past 25 months, partly due to the trade policy with China.
“Beyond trade policy, it’s the strength of the US dollar that makes our goods a little bit more than they would otherwise be for competing countries in the same product categories,” Seroka said. “And right now, the most surprising statistic is that we return twice as many empty cartons as US exports through our docks.”
Monthly cargo volume averaged nearly 930,000 in 20-foot equivalent units since August, something Seroka calls “unusual” so late in the year. The activity is expected to continue for several months.
Seroka said the port has focused on digitizing operations to optimize shipping schedules and logistics.
“The gate is tense,” he said.