Sundance has done a deep dive into what’s causing the massive container traffic snarl-up at California’s ports and on its railways and roads. It turns out to be two interrelated factors.
The trucking issue with California LA ports, ie the Port of Los Angeles (POLA) and the Port of Long Beach (POLB), is that all semi tractors have to be current with new California emissions standards. As a consequence, that mean trucks cannot be older than 3 years if they are to pick up or deliver containers at those ports … In effect, what this 2020 determination and settlement created was an inability of half the nation’s truckers from picking up anything from the Port of LA or Port of Long Beach. Virtually all private owner operator trucks and half of the fleet trucks that are used for moving containers across the nation were shut out.
In an effort to offset the problem, transportation companies started using compliant trucks (low emission) to take the products to the California state line, where they could be transferred to non-compliant trucks who cannot enter California. However, the scale of the problem creates an immediate bottleneck that builds over time. It doesn’t matter if the ports start working 24/7, they are only going to end up with even more containers waiting on a limited amount of available trucks … No amount of extra productivity in working the docks to off-load ships will solve the issue of trucks that cannot pick up the containers and distribute them toward manufacturing or warehouses.
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Yes, years ago the private sector predicted this would happen, and they started taking actions to protect their supply chains. What these massive corporations did to reduce their exposure to supply chain disruption was to immediately formulate plans to divert their goods to other ports … However, it costs more money to move and entire supply chain for trillions of tons of goods coming. Hence, we saw prices climbing as a result of increased transportation costs being factored in to the new logistics. Did you hear about massive increases in container shipment prices? Well, THAT’S WHY. The entire supply chain from Asia to the United States was being modified from the closest port (California) to the ports where internal transportation would not be an issue.
Ships from China and SE Asia being diverted from California into the Gulf of Mexico or East coast have to go through the Panama Canal. It takes twice as long and costs twice as much, if not more. Hence, massive shipping price increases.
There’s more at the link.
Sundance includes this video showing how Amazon containers get here from the Far East. Just look at the complexity of the chain, and think of the costs involved. Talk about transport-fueled inflation!
So, there you have it. Bureaucratic overregulation and progressive left-wing environmental pipe dreams are directly impacting your wallet and mine. That doesn’t exactly give me a warm fuzzy…