The Port of Los Angeles has announced plans to begin charging ocean carriers a dwell fee for empty containers lingering in marine terminals to combat congestion, adding pressure for carriers to pick up empties for transport back to Asia.
The fee will be similar to the import container dwell fee announced in late October, which has yet to be implemented.
The new empty fee is still subject to approval by the Los Angeles Harbor Commission and would take effect on January 30, 2022, at the discretion of the Executive Director.
Under the policy, ocean carriers will be charged $100 for an empty container dwelling for nine days, increasing in $100 increments per container per day until the container leaves the terminal.
“While we have seen significant success reducing import containers on our docks the past two months, too many empty containers are currently sitting on marine terminals,” said Port of Los Angeles Executive Director Gene Seroka. “Just like the import dwell fee, the objective with this empty container program is not to collect fees but to free up valuable space on our docks, clearing the way for more ships and improving fluidity.”
The Los Angeles Harbor Commission will consider the program at its January 13 board meeting.
The Port of Los Angeles announced a similar program on October 25 for lingering import containers. The Port has delayed enacting the fee on the import containers because import containers dwelling more than nine days has been reduced by 53% since October 24, according to the Port of Los Angeles.
The neighboring Port of Long Beach is on board with an identical import container dwell fee, but it has also not yet implemented the fee. No word yet on if the port is also planning a similar empty fee.
Any fees collected from dwelling cargo will be reinvested for programs designed to enhance efficiency, accelerate cargo velocity and address congestion impacts.
According to the Port of Los Angeles’ operations report for December 30, there were 71,369 empty containers at terminals and off-dock depots controlled by the port. The number dwelling nine days or more is not specified.
Amid the pandemic fueled import boom, empty export containers have been piling up at the ports adding to congestion that has hit total throughput and created a large backup of ships waiting for berth space. Executive directors at the ports have asked carriers to bring in addition “sweeper” ships to shuttle some of those boxes back to factories in Asia.
In November, the Port of Los Angeles saw 325,275 TEU worth of empty exports for a rise of 10.6% compared to a year ago. The empty containers reflect the trade imbalance as the United States imports far more cargo than it exports. November’s loaded imports stood at about 403,000 TEU, while loaded exports were only 82,000 TEU.
Carriers plan to pass any fees on dwelling import containers to shippers, so it will be interesting to how carriers respond to this new program on empties.
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