Port Of Oakland Cargo Volume Down 20% In October As Ships Divert South
OAKLAND (CBS SF) – The Port of Oakland announced cargo volume was down 20% in October, as congestion issues elsewhere have prompted ships to bypass the Bay Area's largest port.
The supply chain disruptions are affecting every aspect of life and business in America. One might wonder if Southern California ports are so overwhelmed, why is the Port of Oakland begging for business? It turns out Oakland is quiet because the ports in L.A. are so busy.
Port officials said containerized import volume last month was down 14% from October 2020 levels, while exports were down 27%. The number of ships was down 43% from the previous year.
Officials said the declines can be attributed to "crippling delays" at Southern California ports, prompting companies to divert ships to bypass Oakland and travel directly to Asia.
Congestion at the Port of Los Angeles and the Port of Long Beach had led to huge backlogs. Those two ports alone account for 40% of all shipping containers entering the U.S.
"There's no replacing Los Angeles," said Andrew Hwang, the Business Development Manager for the Port of Oakland. "The Port of L.A., individually, is the largest port in America. The Port of Long Beach is the third largest."
Hwang said because ships are spending so much time in Southern California, they don't have time to sail north to the Bay Area before heading home.
"Because of the delays in Southern California, many of the shipping lines have decided to bypass Oakland and go directly back to Asia," he said.
In response to the bottlenecks, the White House last month announced it helped broker an agreement for 24/7 operations at the Los Angeles port.
Meanwhile, Port of Oakland said they are currently not experiencing the congestion seen at other U.S. seaports.
While vessel traffic was down in October, officials said they expect additional arrivals this month, which would be welcomed by exporters.
"Producers who ship goods out of Oakland have been stymied by scarce vessel space," officials said.
"Their normal shipping routes are completely disrupted," said President of Oakland's S.W. Logistics John Lee. "So what used to be a quick hop to Japan, Korea, China is no longer that. Now it's a convoluted three weeks, five weeks."
Lee said his clients either have to truck their products down to L.A. for shipping -- at double or triple the cost -- or sell it here at home at a much reduced price. He said the capacity at the Port of Oakland is simply too small to compete with those in Southern California, which are six to nine times larger.
"It's like driving on a two-lane highway versus, you know, a 10-lane express highway down in L.A," said Lee. "There's just not as much infrastructure here."
But Hwang said even though there are fewer ships arriving, they're carrying a lot more cargo. He said they're loading and unloading 50 percent more on each ship than they used to. Oakland Port officials say business is slowly increasing and they expect to see more improvement in the spring.
But Lee said he suspects that as long as a bottleneck exists in Southern California, the Port of Oakland will be seen as a detour that shippers cannot afford to make, and exports produced here will have a hard time making it to market. Oakland is discovering that -- in the complex web of the supply-chain economics -- size does matter.