PierPass Fees at Ports of Los Angeles and Long Beach to Increase 4.2% Effective Aug. 1
Bill Mongelluzzo, Senior Editor at the Journal of Commerce, provides this update on the LA-LB port complex announcement regarding PierPass changes:
“Terminal operators will increase the traffic mitigation fee (TMF) used to fund night and weekend gates at the Los Angeles-Long Beach port complex by 4.2 percent starting Aug. 1.
The TMF, which is adjusted each year based on the West Coast longshore contract, will increase to $33.47 per TEU and $66.94 per FEU on all non-exempt containers, the West Coast Marine Terminal Operators Agreement (WCMTOA) announced Tuesday. Exempt containers include empties, laden containers that transit the Alameda Corridor, and containers that are transshipped. Empty chassis and bobtail trucks are also exempt, WCMTOA said in a statement.
In addition to the 8 a.m. to 5 p.m. weekday gates that most US ports offer, the 12 container terminals in Southern California normally operate four weeknight gates and one weekend day gate. When it was instituted in 2005, the TMF was charged only on container moves made during the peak daytime hours when traffic on local streets and freeways was the heaviest.
Originally, truck moves in the off-peak hours did not pay the fee, but that changed in late 2018.
By discouraging daytime traffic, the TMF created operational problems, including truck “bunching” in the late afternoon as truckers queued up outside the gates, waiting for the fee to end with the beginning of the night shift.
PierPass Inc., which manages the extended gates program for WCMTOA members, in late 2018 switched to a flat fee charged on all non-exempt truck moves, both day and night. John Cushing, PierPass president, told JOC.com last December that as a result of the new flat fee, truck bunching at terminal gates was eliminated, truck turn times improved, and the approximately 50-50 split between peak and off-peak hours remained.”
Record Drop in Ocean Container Volumes Within Last 30 Years
Sam Chambers, writing for Splash 247, reports on new data from London based research firm, Clarksons who expect 2020 to see the sharpest contraction in global ocean container trade on record. The research considers both the recent volume contraction as reported by several of the major ocean carrier’s as well as the projected recovery through the remainder of this year.
Overview:
Container volumes contract at sharpest levels in 30 years
Carriers manage vessel capacity accordingly to hold rates firm
Sam Chambers, writing for Splash 247, reports on new data from London based research firm, Clarksons who expect 2020 to see the sharpest contraction in global ocean container trade on record. The research considers both the recent volume contraction as reported by several of the major ocean carrier’s as well as the projected recovery through the remainder of this year.
While container volumes plummet, Lars Jenson from SeaIntelligence Consulting tells Splash that “unlike in the financial crisis, freight rates are holding firm [and that] the outlook for 2020 cannot at this moment to said to be as bad as what we saw a decade ago [Financial Crisis] from a profitability perspective.”
Through a series of blank sailings readjusting sailing schedules ocean carriers have successfully been able to hold the line on container rates. The Global Container Freight Index managed by Freightos bears this out. The COVID-19 related post Chinese New Year rate dip from mid-January to the beginning of March has recovered, with global container rates now just about where they were at the start of the year
