Port of Los Angeles Extends Dwell Fee Threat for Ocean Carriers

Southern California’s Port of Los Angeles has extended its container dwell fee program threatening ocean carriers with steep daily fees for import containers sitting at marine terminals. To date, the port is yet to trigger implementing the fees.

Under the program adopted by both the Port of Los Angeles and Port of Long Beach in late October, the ports can charge ocean carriers for each loaded import container dwelling past nine or more days for truck-bound containers and six or more for rail containers. The charge starts at $100 per container, increasing in $100 increments per container per day until the container leaves the terminal. 

The policy was developed in coordination with the Biden-Harris Supply Chain Disruptions Task Force, U.S. Department of Transportation and undisclosed “supply chain stakeholders,” and any fees collected from dwelling cargo are supposed to be reinvested for “programs designed to enhance efficiency, accelerate cargo velocity and address congestion impacts.”

The program was originally planned to last 90 days from its scheduled to start of November 1, with an initial 15-day grace period. But the program gave the executive directors from the ports ultimate authority to decide whether or not to trigger the fee.

Come November 15, the executive directors decided to postpone the start of the fees by a week, citing its effectiveness in driving down the number of long-dwelling import containers at terminals. Fees have now been postponed by both ports each week since the start of the program.

Even without the fees being implemented, the executive directors of the ports have credited the program with helping to reduce the amount of aging cargo containers by a combined 55% since the program was announced last October 25.

On Thursday, the harbor commission for the Port of Los Angeles voted 5-0 to extend the dwell fee program until April 29, while also amending the fee so that import rail containers are given the same 9-day cutoff as truck-bound containers.

“Since the announcement of the fee in October, import cargo lingering nine days or more has declined by 60% at the Port of Los Angeles,” Seroka said. “We’re very pleased with the progress, which is why the fee has not been enacted. Data will continue to be monitored daily as we work with our partners to find further efficiencies.”

Under the updated policy, the Port of Los Angeles will have the authority to charge ocean carriers for each loaded import container dwelling nine days or more, regardless of whether it is a rail or truck container.  

The Port of Los Angeles cargo operations update from Friday showed there 15,209 import containers dwelling nine days or more.

An update from the Port of Long Beach on Friday said it now plans to delay consideration of the fee until January 21, but it’s not clear if it will also extend the program beyond its current expiration at the end of the month.

The Port of Los Angeles Harbor Commission on Thursday was also presented information about a similar plan for empty containers, which the Port of Los Angeles announced last month. During the meeting, Seroka outlined the plan and said the port has been in dialogue with a range of public and private stakeholders about the proposal. However, no vote was taken, leaving the question of whether or not the empty dwell fee will be implemented as planned at the end of the month on January 30.

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