President Joe Biden announced on Twitter early Wednesday, October 13 that the Port of Los Angeles, the busiest in the country, would begin operating 24 hours a day, seven days a week, to address supply chain disruptions at the White House. a push from Those jeopardizing plans for the holiday shopping season and slowing the country’s economic recovery from the pandemic.
Biden is due to discuss the announcement on Wednesday. Port of LA Executive Director Jean Cerocca is in Washington DC for talks on supply chain issues, which have led to backing up of ships off the Southern California coast and maximizing warehouses in the Inland Empire.
The LA Port’s move to 24/7 operations follows the Port of Long Beach, which began a one-terminal, 24/7 pilot program about three weeks ago.
It was not immediately clear whether all of LA’s terminals would go into 24/7 operation or whether Long Beach would expand its program.
But under the proposed plan, the port would nearly double the number of hours it takes container ships offshore to move cargo from delivery trucks on the country’s highways. The staff will work all night. Members of the International Longshore and Warehouse Union will fill the additional shifts.
A senior White House administration official said ILWU has committed staff to a 24/7 operation.
That official also said that major shippers and retailers, including Walmart, FedEx, UPS, Samsung, Home Depot and Target, have agreed to ramp up operations to clear cargo from ports and free up more space at docks.
A formal announcement from the largest freight carriers, including FedEx and Walmart, is expected on Wednesday.
“The supply chain is essentially in the hands of the private sector, so we need the private sector to help us solve these problems,” the White House official said.
The goal is to process and unload 3,500 additional containers during the night each week.
The Port of Long Beach began its pilot 24-hour terminal program in September, but overnight cargo pickup from truck drivers is still intensifying.
Meanwhile, the Port of Los Angeles reported last month that 30% of appointments in non-peak hours were not being filled by truck drivers. Warehouse space is also extremely limited.
All of this emphasizes that any program that proposes streamlining a supply chain closed at almost every point will require extensive procurement to synchronize the many moving parts.
Cargo ships have been anchored offshore for weeks from the ports of Long Beach and Los Angeles. 58 container ships had reported offshore as of Tuesday morning. This is down from a reported peak of 73 container ships offshore two weeks ago.
Biden launched a supply chain disruption task force in June to focus on transportation and logistics barriers to the US economic recovery. Port envoy John Porcari was appointed in August to help coordinate between private firms controlling the transport and logistics supply chain.
Porcari is scheduled to appear with Serocca during the Thursday, October 14, news conference.
According to a White House release, the ports of Long Beach and Los Angeles are the points of entry for 40% of containers in the US, and are on track to reach new highs in container traffic this year. Through August, Los Angeles has moved 30% more and Long Beach 20% more containers to US exporters.
Earlier this summer, the Port of LA also became the first in the Western Hemisphere to move 10 million containers in a 12-month period.
The increase in cargo followed a six-month crash during the initial wave of the coronavirus, which temporarily closed factories in China – America’s biggest trading partner – and shut down every non-essential sector of the US economy .
But then, in the summer of 2020, a shift in consumer habits toward online shopping for items helped them get through the isolation, causing cargo volumes to skyrocket. They have remained high ever since.
However, this has led to logistical challenges throughout the supply chain. Trade executives, including the head of a toy-making organization, have said that unless things change, there could be a shortage during the holidays.
And some companies have taken matters into their own hands. For example, Target and Walmart have hired their own freighters to help them avoid backlogs at ports.
But overcoming supply chain challenges, officials have said for months, is a complex task.
“You can’t flip a light switch in this complex supply chain and replace it overnight, but we’re already seeing signs of it,” the senior administration official said. “And through commitments received from major retailers, for example, there’s a strong signal to do this.”
Commitments being announced on Wednesday include:
- Walmart is committed to increasing its night-time use and increasing throughput by 50% over the next several weeks.
- UPS is committed to the increased use of 24/7 operations and increased data sharing with ports, which will allow it to carry up to 20% more containers from ports.
- FedEx is committed to working to link the increase in night time with changes in trucking and rail usage to increase the amount of containers it will move from ports. The changes could result in doubling of the amount of cargo going out of ports at night.
- Samsung is committed to move around 60% more containers out of ports over the next 90 days working 24 hours a day.
- Home Depot is committed to moving an additional 10% of containers per week during newly available off-peak hours at the Port of Long Beach and the Port of Los Angeles.
- Target, moving about 50% of its containers at night, is committed to increasing that amount to 10% over the next 90 days to help ease congestion at ports.
This story is breaking and will be updated.
Staff writer Chris Heyer contributed to this story.