Local ports feeling global supply chain ripple effects – Longview Daily News

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Local ports feeling global supply chain ripple effects – Longview Daily News

Local ports feeling global supply chain ripple effects

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Local ports feeling global supply chain ripple effects

River traffic

Vessels travel in the Columbia River Friday afternoon. 

Marissa Heffernan, The Daily News

A global supply-chain bottleneck is hitting home, with local ports feeling the pressure of backed-up goods and idling ships.

In Longview, Port Director of Business Development Christian Clay said while there’s currently only one vessel waiting for a berth in the river, the number fluctuates depending on berth availability and ship arrival times.

In Woodland, Port Executive Jennifer Wray-Keene said the port’s manufacturing tenants have sometimes struggled to get parts they need.

“Items coming from those ships are impacting our manufacturing companies,” she said. “It is quite difficult to get many different components, replacement parts for equipment, etc.”

According to the American Association of Port Authorities, the current situation came from a combination of factors, most of them pandemic-related. First, U.S. consumer spending dropped 30% in April 2020 before rebounding sharply later in the year, shocking the supply chain “that had throttled back as economies fell into recession.”

And the uptick in spending came in a different area, with people snapping up clothing, computers and household goods instead of spending on travel and entertainment. That coincided with pandemic closures of factories in Asia, which stalled the usually smooth flow of shipping containers around the world.

“When orders surge for medical equipment and PPE, Chinese factories unexpectedly” came back online, the AAPA press release said, and the supply chain was unprepared.

Not only were shipping containers in short supply, with 25 million containers “in the wrong place to meet resurgent demand later in the year,” but many shipping routes had been canceled and then quarantines and illness kept thousands of port workers off the docks.

Semi trucks also began to see a shortage of container chassis, and several large trucking companies went bankrupt, AAPA said, disrupting an industry that moves 71% of U.S. freight. The remaining truckers were shifted from retail to priority industries such as food and cleaning supplies.

As flights were canceled or reduced, shippers also lost the use of empty cargo space. Even when some airlines re-opened dormant overseas passenger routes just to carry cargo, the industry could only meet 80% of demand, because air freight volume rose 50% over 2019.

As those things happened on a worldwide scale, Longview’s Clay said that port-specific congestion also had an effect.

“Instead of a steady stream of vessels shipping out of origin ports, we are seeing bunching of vessels as they arrive on the West Coast,” he said.

Once vessels make it to the berths, Clay said how long they need to stay there depends on the cargos being loaded or discharged. Loading and discharge time can range from a single day to 10 days.

“Port staff works closely with beneficial cargo owners and Local 21 to load or discharge a ship as safely and efficiently as possible to facilitate an open berth for the next vessel, thereby keeping down congestion in the river,” Clay said.

Because there’s congestion across the supply chain, Clay said the port is getting a high lot of out-of-sync supply and demand that causes a ripple effect.

“That is challenging to overcome given the cost and time to bring on additional assets to move cargo,” Clay said.

For example, more containers, trucks, chassis, rail cars or locomotives take time and money to build, so can’t be put into place right away to relieve congestion.

Clay said the key to an efficient supply chain is to keep vessels and cargo moving from origin to destination as quickly as possible, because “once assets start to sit, such as containers trapped onboard a ship waiting to berth, it creates even more container and ship shortages on both ends of the supply chain.”

“It also causes a surge of product that is then challenging to move out of the West Coast ports,” he said. “The increased freight quickly overwhelms the inland transportation to move it to its final destination. This entire process is called supply chain bullwhip or whiplash effect and causes severe variability in the delivery of goods.”

That’s what consumers and manufactures alike start to see as some products change in price or become hard to find.

Wray-Keene said at Woodland, there’s also a ripple effect in play.

“The backlog of one item may hold up the production of a larger product so existing stocked items sit there while other components are needed,” she said. “Those secondary companies are feeling that pinch for product.”

This has been happening at ports of all sizes, Clay said, because as larger West Coast ports clog up, shippers have begun to look for other open ports that can handle their business. The Port of Longview and several other Pacific Northwest ports can handle many commodities that would traditionally have gone to another port or that would have been put in containers, if they were available.

“This happens from time to time when there are shocks to the supply chain,” Clay said. “The Port of Longview and our ILWU partners at Local 21 pride ourselves in being nimble by working with our customers to provide safe and efficient solutions.”

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