Shippers Find New Supply-Chain Hurdles at Alternate Ports

Shippers Find New Supply-Chain Hurdles at Alternate Ports

When Flexport Inc. learned in the past month that an ocean carrier planned to shift cargo from the congested operations at the Port of Los Angeles to little Port Hueneme some 80 miles up the California coast, the freight forwarder found that trucking companies weren’t ready to go along with the changing direction of the imports.

“We talked to trucking carriers throughout the market in L.A. and Oakland and the sense was that they could not support the volume if it moved through Port Hueneme,” said Jason Parker, the company’s head of trucking.

The San Francisco-based company shifted gears, pulling 200 containers from the ocean booking and instead routing many of them to Los Angeles despite a likely longer wait there to offload goods.

“The two-week delay coming to Los Angeles versus the Hueneme routing was going to cause less headache for the customers,” Mr. Parker said.

The choice highlighted how shippers looking to avoid bottlenecks at major gateways by diverting goods through alternate ports face tough tradeoffs and new questions. How do they get furniture, clothing, toys and other items to stores and warehouses that are far from their established supply lines and have modest transport connections to other parts of the country?

Smaller ports don’t have dozens of ships stacked up off the coast waiting for berth space, as do Los Angeles and the neighboring Port of Long Beach, Calif. The sites have drawn long looks from shippers and freight forwarders, and even brought them chartered ships from the growing number of retailers who are hiring vessels to get around the backups to get goods in stores for the holidays.

But most don’t have enough dock workers to unload cargo or a steady supply of truckers or warehouse space to handle a big jump in cargo volumes, said Anthony Hatch, a rail transportation analyst and principal at ABH Consulting.

“They make for nice stories,” Mr. Hatch said. “But they are all on the margin.”

The efforts have sent cargo to established West Coast gateways like the ports of Seattle and Oakland, Calif., and to destinations still farther from traditional container shipping trade lanes. The Port of Portland, Ore., which lost regularly scheduled container service in 2016, has recovered some operations and gained some charters this year. The Port of Hueneme, known mostly as an import gateway for Del Monte bananas, expects its first chartered container ship to arrive in November.

Ports on the East Coast like Baltimore and Port Tampa Bay, Fla., also are trumpeting congestion-free operations in an effort to lure container lines and their shipping customers.

The capacity at those ports pales against the operations at Los Angeles and Long Beach. That complex handled just over 6 million loaded inbound containers in the first seven months of the year, nearly 40% of all container imports that landed at U.S. ports over that time, according to Beacon Economics, a research firm based in Los Angeles.

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