Problems at the Port – A Discussion on Dwell Time

Problems at the Port – A Discussion on Dwell Time

It’s been a rough few years for ocean shipping. Delays driven by the pandemic, a shortage of shipping containers, port congestion, staffing shortages, ever-changing regulations, and port strikes have increased dwell times to the point that everyone who works in an industry affected by the supply chain is uncomfortable. Some of us cry a lot. 

Add the growing issues with getting goods from a port to the final destination, and you have a recipe for shipping disasters. 

What Is Dwell Time? 

Container dwell time happens at a railyard or port, causing congestion at border crossings and ports. Cargo containers may spend days at temporary storage facilities in container yards and shipping ports. There may be delays as the container is unloaded from the ship. 

In some cases, ships wait up to two weeks to be unloaded at a port, triggering excess fees and contributing to devastating environmental consequences. After unloading, the shipping containers go into storage until customs clears them and the paperwork catches up. 

Securing transport for the container and loading it so a truck can take it to its destination presents another set of challenges. There is a massive shortage of trucks, parts, and truck drivers in the U.S., and delays at the port typically cause problems further down the supply chain as trucks wait to pick up freight to deliver to their destination. 

Dwell time also refers to the time truck drivers spend waiting to pick up or drop off loads. Excess dwell time causes frustration for drivers and impacts the efficiency of on-site operations. There’s an undeniable ripple effect throughout the supply chain. 

For carriers, excess dwell time immediately eats into the bottom line. Even though carriers typically charge detention fees, they prefer to keep their trucks on the road as much as possible. 

Dwell time in the trucking industry is an especially serious issue when a single truck carries multiple shipments for different customers. Dockworkers and warehouse crews must unload these shipments quickly but struggle due to the more complex nature of partial truckload (PTL) and less-than-truckload (LTL) shipping. 

Dwell Times Rising At Ports All Over The World

Dwell times fluctuate from one port to the next and may be affected by rolling COVID lockdowns, staffing shortages, strikes, and a shortage of parts and equipment. 

U.S. Ports See Dwell Times Ranging From One to 13 Days

U.S. Ports continue to struggle under the heavy weight of fluctuating dwell times. If becoming a dock worker is on your bucket list, now is an excellent time to apply. 

In Charleston, the new minimum waiting time is five days. Ships face a five to 10-day waiting time at the Norfolk terminal for a berth. In an effort to reduce dwell times, Norfolk has increased storage costs and added two cranes to be placed into service in June 2022. 

At the New York terminal, waiting times for berths are about seven days, while high yard and berth utilization continue. Surpluses across all New York ports remain high, even though empty stocks have been significantly reduced. 

Savannah averages one to three days of waiting time, and terminals are at 86% utilization. The Savannah terminal faces significant issues with implementing a new N4 system. There have been a number of serious problems with the new system, and each time a new feature is added, administrators have to reboot the entire system, causing further delays. Even so, the average wait at this terminal is just one to three days. 

At the Houston terminal, three shore cranes moving from Bayport are being installed to help relieve some of the backlogs. 

Chinese Ports Experience Longer Dwell Times Due to COVID Lockdowns

The Port of Yantian continues to experience severe delays. It averaged 15.7-day dwell times to the port of Hamburg, Germany in March, representing a significant upswing in delays compared to 6.6-days for the same route during January. 

The Port of Shanghai is operational, but restrictions on trucks entering the area have forced import contained dwell times up to 8+ days, which represents a 74% increase over average dwell times on day one of the phased lockdown that began March 27, 2022. Shanghai averaged 12.2-day delays during the same period to the port of Hamburg after experiencing 6.6-day delays in January. 

In January, Tianjin averaged 7.7-day dwell times to Hamburg and faced 12-day delays in March. 

What’s Causing Increased Dwell Time At Ports?

Chassis supply problems are one significant driver of the supply chain issues in the U.S. 

Manufacturers estimate that it will take most of the following year before there are enough marine chassis to handle the import containers currently causing congestion in inland rail ramps and U.S. ports. The industry needs 45,000 to 50,000 marine chassis to help clear up current supply chain issues at the ports, and industry experts estimate that they’ll produce 20,000 to 25,000 during 2022. Have you always wanted to build chassis? Because the industry is hiring. 

In China, government-mandated COVID lockdowns make getting ships unloaded and moving goods throughout the country impossible. Until the Chinese government eases stay-at-home orders, continued delays are expected. 

Dwell times across Europe are up 43% since February due to the disruption caused by the Russian-Ukraine war. Food and beverages and consumer packaged goods had dwell times that were up 55%. The conflict is causing shipping prices to go up, as well. While ocean shipments from Shanghai to Rotterdam were $2,000 for a single container just two years ago, some freight costs have risen to over $54,000 per container after the Russian invasion of Ukraine. 

Can Shippers Minimize Dwell Times?

Unfortunately, there’s more to the current situation with record-setting dwell times than shippers who aren’t paying attention to deadlines. Supply chain problems across every phase of a product’s journey, from manufacturing to delivery at the final destination, have created complex issues that don’t respond to a one-size-fits-all solution. 

One of the more traditional ways to incentivize shippers to be on time is to charge detention fees. These hourly costs add up fast, but they can cause further issues such as payment delays. 

Advanced technology can help shippers mitigate supply chain problems within their control. Many shippers use the following tactics to help reduce dwell time within the trucking industry: 

  • Paperless check-in procedures help alleviate some of the time-consuming and error-prone paperwork truck drivers must complete when picking up and delivering loads. 
  • Live load dock doors allow shippers to unload a trailer as soon as it docks, which can eliminate some of the frustrating delays within the trucking industry. 
  • Drop trailer systems allow truck drivers to unhitch a loaded truck at the destination and immediately hitch a new (loaded) trailer so they can keep moving. 

Reducing dwell time at ports is more complicated for shippers since so many of the current problems, including the worldwide pandemic, continued shutdowns at overseas ports, equipment shortages, and staffing shortages, aren’t within a shipper’s control. 

Shippers facing never before seen dwell times must get creative as they work to deliver their goods. Live shipment tracking is a must in this challenging environment. Networking with other professionals in the industry to stay on top of trends, world events, and changing technology is also critical for shippers navigating unprecedented problems at ports all over the world. 

Industry Considerations

Shortages inspired many to place bulk orders, and the increased demand is one of the forces behind the shipping container shortage and backlogs at American ports. Online shopping was the only choice for many people, and a spike in the volume of shipments combined with a lack of dockworkers and truck drivers worsened the problem. Now, goods are left stranded on ships, sometimes for weeks. Every industry is negatively affected by our broken supply chain. 

For produce shipments, delays can be devastating, causing entire loads to spoil or become contaminated. Shipping challenges caused by the pandemic resulted in sky-high shipping costs, and consumers feel the pain of higher prices on nearly everything they buy. Specially-designed stickers featuring the image of a couple of recent presidents appear on gas pumps, meat cases, and anywhere Americans purchase necessities proclaiming, “I DID THAT.” But we know we can’t lay supply chain disruptions at the feet of a single human. These problems are essentially the result of forces beyond our control. 

Industries that count on shipments from China and the Middle East have experienced a 300 to 400% price increase. For e-commerce businesses, marketing is key. Slowly eroding customer expectations about free two-day shipping (Amazon Prime – that means you)  and being honest about supply chain disruptions is crucial if businesses that count on internet orders want to stay afloat during these difficult times. 

Key Takeaways

  • Increased dwell time is painful, expensive, and frustrating. Shippers must use advanced technology and get creative to overcome this lingering and unfortunate situation. 
  • Some of the main drivers of increased dwell time include the ripple effect of the worldwide pandemic, continued stay-at-home orders in China, marine chassis shortages expected to extend well into 2023, and widespread staffing shortages affecting every link in the supply chain.

The current state of our supply chain is unfortunate, and we won’t get relief during 2022. Until problems at the port clear up, it’s crucial to partner with a shipping company willing to provide consistent and reliable communication through every step of the shipping process.  

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Is There a Way to Wake Up From ERD (Early Return Date) Nightmares?

Early return dates (ERDs) can give anyone the chills. For example, imagine you just successfully finished a grueling negotiation to deliver a large shipment to an overseas buyer. Your company organized a trucking company to transport goods to the port over the next week. You even paid for the storage costs of your goods before they get loaded onto your vessel.

But as soon as all this was finalized, you were told your early return date (ERD) shrunk from a week to only 2 days. Sound familiar?

The unfortunate reality is that situations like this happen far too regularly. Suddenly, all your careful planning is for nothing, and you face extra costs at every turn. The ERD nightmare is real.

There is no easy fix to problems stemming from changes in ERDs. It is an industry-wide problem that plagues all shippers and is the source of many sleepless nights for shipping coordinators.

What can you do to manage the risks of changes to ERDs better?

What Is ERD?

An early return date (ERD) is a policy introduced to help manage the flow of export containers into ports to reduce congestion. Problems arise because ERDs change far too frequently. And the worst part is that ERDs change with almost no advanced notice for shippers.

ERDs- A Multi-Layered Challenge for Ocean Exports

The importance of ERDs for shippers is that they need to make sure their containers don’t arrive too early at ports. Otherwise, they face demurrage penalties, storage fees, chassis rental costs, and other charges. But if their containers arrive late, their cargo may miss the opportunity to get loaded onto the vessel.

This balancing act isn’t always easy. During the pandemic, more than one-quarter of shippers reported that they experienced ERD changes, with about 7% reporting that these changes cost them $1000 or more.

What compounds these difficulties is that many ocean carriers reduce sailings in response to the negative economic impacts of events like Covid-19 and the Ukraine conflict. The net result is that companies looking to transport goods experience even greater headaches.

The worst part is that ERDs can, and all too often, change with little notice. Almost always, these schedule changes cost shippers more money. When profit margins are already tight, these unexpected charges can cause many sleepless nights.

So, in the face of such a tumultuous environment, how can shippers manage these risks and better operate under the constraints of ERD?

Hope for the Future

OL USA strives to help eliminate problems in global trade. We know the challenges you face and the hardships brought about by changes in ERDs.

OL USA is dedicated to transparency through the use of our proprietary track and trace system. We are a full-service transportation partner that can help your business face challenges in transporting goods worldwide.

And there are other reasons for optimism moving forward. Governments in the U.S. and worldwide have responded to the surge in shipping by addressing industry shortcomings. And the scope of financial resources made available with the surge in shipping activity means that there are powerful incentives in place to improve the current system.

With advances in technology and the surge in stakeholder interest in creating a more efficient flow of goods, ERD nightmares can soon become a thing of the past.

Together We Can Succeed

We all know the importance of providing goods and services to markets around the world. It is in everyone’s best interest to work together to find workable solutions to today’s problems.

So don’t worry. We’re all in this together.

Follow us on social media to stay updated on our latest efforts.

Sign up for OL USA's weekly Industry Snapshot

* indicates required

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