Ocean Freightliners Lined Up Off The Southern California Coast

ocean freight ship

For almost a year now, I have been talking about the logistics problem for product (most notably, massage chairs) coming to the USA from China. There has been a back up at the Port of Long Beach since the 4th quarter of last year.  Chairs coming from China had been backed up for 4-6 weeks before finally getting to the warehouses of the distributors.

Well, after almost a year, you’d think that things have worked themselves out and started getting back to normal. Honestly, things did pick up a bit over the summer and inventories were being restocked so that we didn’t have to think much about the logistics pile-up. I hadn’t thought much about it the last couple of months because most companies had stock to sell from.

That was until I was in Southern California last week visiting my store in Cerritos. I spent some time with my son in Huntington Beach enjoying the Pacific Ocean. I couldn’t help but immediately notice the traffic jam of freightliners sitting off the coast of Huntington Beach. The line up extended for miles northward toward Long Beach. It was amazing to see this long line of freighters sitting idly on the horizon. I took some footage of the traffic and you can see the video below.

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I also came across an article in the Wall Street Journal that elaborates more on the Port of Long Beach ocean traffic jam.

https://www.wsj.com/articles/cargo-ships-are-again-idling-off-jammed-southern-california-ports-11629229285?mod=searchresults_pos9&page=1

UPDATE 9/27/21: I just read this article in The Guardian with more up-to-date info on the cargo ship logjam:

A record number of cargo ships are stuck outside LA. What’s happening?
Port complex of Los Angeles and Long Beach, already the busiest in the US, has seen major traffic this week as imports boom

Read in The Guardian: https://apple.news/Axg33EN0vStiWwQM7dDN2xg

Unfortunately, I don’t see it getting any better before the end of the year. Once Black Friday hits, sales demand will increase exponentially, which will result in further product back orders and port delays. Quite a year it’s been, eh? Hang in there! Experts predict some semblance of normalcy coming back in 2022.

Dr. Alan Weidner

 

 

2 Replies to “Ocean Freightliners Lined Up Off The Southern California Coast”

    1. Great question. It’s a little convoluted, but I’ll give it a try:

      1. At the onset of Covid-19, Chinese production declined because of shutdowns/slowdowns in China
      2. Meanwhile, foreign demand is steady, but supply is diminished because of Chinese shutdown/slowdown – less product available for foreign demand
      3. Foreign shutdown/slowdown then happens because of Covid-19 – USA in lockdown
      4. Chinese production begins to return to normal again
      5. Chinese products reach USA
      6. Because of US shutdown/slowdown, lack of manpower at ports and trucking
      7. Ports are backed up with renewed Chinese production
      8. Port backups result in slowdown of unloading ships and getting them through customs and to warehouses
      9. Foreign demand of Chinese product increases because more people are at home…buying online
      10. Because of the backup at the ports, more containers on the water and not being unloaded
      11. Meanwhile, production in China increases because of increased foreign demand for Chinese-made products
      12. All the containers are stuck on the water of foreign countries because of port backups
      13. Shortage of containers back in China to load up increased product demand
      14. Shortage of containers leads to much, much higher costs of available containers in China (decreased supply + increased demand = premium container pricing)
      15. Prices of US products go up to cover the increased costs
      16. Companies are ordering more than usual and further ahead than usual because of fear of lack of inventory = increased demand and production of Chinese products

      Bottom line: Increased US demand of Chinese product -> increased Chinese production -> insufficient workforce in USA to handle influx of new products at ports -> containers stay on the water for 1-2 months waiting to get through the port -> container shortage in China -> increased price of containers -> increased price of product to end consumer.

      I hope that sums it up pretty good. I’m sure it’s not all correct, but this is more or less the gist of this fiasco off the coast of Southern California.
      dr. w.

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