Five
ship to
shore
cranes
and
gangs of
longshoremen
work to
load and
unload
the
container
ship CMA
CGM
Laperouse
at the
Georgia
Ports
Authority's
Port of
Savannah,
Wednesday,
Sept.
29,
2021, in
Savannah,
Ga. With
three
months
until
Christmas,
toy
companies
are
racing
to get
their
toys
onto
store
shelves
as they
face a
severe
supply
network
crunch.
Toy
makers
are
feverishly
trying
to find
containers
to ship
their
goods
while
searching
for new
alternative
routes
and
ports.
(AP
Photo/Stephen
B.
Morton) |
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Masters
of the
Universe
figures,
by
Mattel,
are
displayed
at the
TTPM
Holiday
Showcase,
in New
York,
Thursday,
Sept.
23,
2021.
With
three
months
until
Christmas,
toy
companies
are
racing
to get
their
toys
onto
store
shelves
as they
face a
severe
supply
network
crunch.
Toy
makers
are
feverishly
trying
to find
containers
to ship
their
goods
while
searching
for new
alternative
routes
and
ports.
(AP
Photo/Richard
Drew) |
|
U.S.
supply
chain
too
snarled
for
Biden
Christmas
fix,
experts
say
reuters.com
Shipping
containers
are
unloaded
from
ships at
a
container
terminal
at the
Port of
Long
Beach-Port
of Los
Angeles
complex
in Los
Angeles,
California,
U.S.,
April 7,
2021.
REUTERS/Lucy
Nicholson
WASHINGTON,
Oct 14
(Reuters)
-
President
Joe
Biden is
pushing
to ease
supply
shortages
and tame
rising
prices
in time
for
Christmas,
but
unsnarling
U.S.
supply
lines
could
take far
longer,
experts
told
Reuters.
Biden
brought
together
powerbrokers
from
ports,
unions
and big
business
on
Wednesday
to
address
shipping,
labor
and
warehousing
pain in
the U.S.
supply
chain,
and
announced
new
around-the-clock
port
operations
in Los
Angeles.
As
his
Republican
opposition
seizes
on
possible
Christmas
shortages
to
connect
Biden's
economic
policies
to
inflation,
and try
to stall
a
multitrillion-dollar
spending
bill in
Congress
in
coming
weeks,
the
White
House's
message
Wednesday
was that
a
solution
is in
sight.
"This is
an
across-the-board
commitment
to going
to
24/7,"
said
Biden, a
Democrat.
The port
opening,
and a
promise
from
retailers
like
Target
and
Walmart
to move
more
goods at
night
are a
"big
first
step,"
he said.
Now, he
said,
"we need
the rest
of the
private
sector
chain to
step us
as
well."
While
more
cooperation
among
the
often
competing,
secretive
players
in the
U.S.
supply
chain
business
is a
plus,
the
White
House's
impact
may be
incremental
at best,
logistics
experts,
economists
and
labor
unions
warned.
"What
the
president's
doing
isn't
going to
really
hurt.
But at
the end
of the
day, it
doesn't
solve
the
problem,"
said
Steven
Ricchiuto,
U.S.
chief
economist
at
Mizuho
Securities.
Americans,
already
by far
the
world's
biggest
consumers,
have
simply
been
buying a
lot more
stuff
during
the
pandemic,
much of
it
imported.
Couple
that
with
labor
shortages,
equipment
shortages
and a
lack of
space to
store
that
stuff,
nationwide.
Players
from
ports to
retail
chains
are
already
working
full-tilt
to
handle
the
pandemic-fueled
surge in
imports
and get
holiday
gifts
onto
shelves
and
e-commerce
centers
in time
for the
Nov. 26
Black
Friday
kickoff
of the
2021
holiday
season.
Imports
at the
Port of
Los
Angeles
- the
No. 1
gateway
for
ocean
trade
with
China -
are up
30% so
far this
year
over
last
year's
record.
But
that has
left
some
250,000
containers
of goods
stacked
up on
the
docks
due to
delayed
pickups,
from
chassis
shortages
and a
lack of
space in
rail
yards
and
warehouses.
And that
is
causing
dozens
of ships
to back
up at
anchor
outside
the
port.
"The
analogy
would be
the boa
constrictor
that ate
the
mouse.
There's
a lump
in it
and the
lump is
the
constraint
in the
throughput
of the
supply
chain,
and it
moves
along
each
time you
solve
for a
constraint,"
said Joe
Dunlap
global
head of
the
supply
chain
advisory
team at
CBRE
Group
(CBRE.N),
a
commercial
real
estate
services
firm.
'YOU
DON'T
BUILD A
CHURCH
FOR
CHRISTMAS'
Frank
Ponce De
Leon,
International
Longshore
&
Warehouse
Union
Coast
Committeeman
summarized
the
problem
at U.S.
ports,
which
the
Commerce
department
estimates
handle
76% of
all
trade,
during
comments
last
week.
"You
don't
build a
church
for
Christmas
and
Easter;
you
build it
for a
regular
Sunday
service,"
he said.
"With
the
unprecedented
influx
of
cargo,
it's
like
Christmas
and
Easter
on the
docks
every
single
day,
with
more
ships
coming
in and
the pews
have
been
full for
months,
and
there's
nowhere
left to
sit - or
stand."
Dockworkers
remain
available
for
24-hour
shifts
to help
clear
the port
backlogs,
the
longshore
union
said.
But that
is not
true of
the
people
who move
goods
from the
ships or
from
ports,
other
unions
say.
"One
of the
major
problems
with the
current
state of
logistics
is the
shortage
of port
truck
drivers.
They are
not paid
a living
wage,"
said
Teamsters
General
President
Jim
Hoffa,
who
participated
in the
meeting
with
Biden.
The
backup
may be
exacerbating
that
shortage,
because
many
port
drivers
are not
paid for
the
hours
they
spend
waiting
to pick
up a
container,
making
the job
less
appealing.
Still,
there is
no
evidence
experienced
workers
are
sitting
on the
sidelines
- U.S.
transportation
and
warehousing
are
employing
more
people
now then
they did
before
the
pandemic
started,
data
from the
Bureau
of Labor
Statistics
show.
Reuters
Graphics
Reuters
Graphics
WAREHOUSES
OVERFULL,
UNDERSTAFFED
Like
seaports,
warehouses
work
best
when
they are
moving
products
in and
out
quickly
and
predictably.
Instead,
port
officials
say,
they are
packed
to the
rafters
and
struggling
with
employee
hiring
and
retention.
U.S.
companies
are
leasing
warehouse
space at
record
levels
to
handle
the
large
influx
of goods
for
e-commerce.
The
markets
that
serve
Southern
California
ports
include
Los
Angeles
and the
Inland
Empire
region
nearby,
which
had
second-quarter
vacancy
rates of
1.2% and
1.4%,
respectively,
according
to CBRE
data.
"Space
is
clearly
tight,"
Dunlap
said.
It
is not
just
that
warehouses
are at
capacity,
Steve
DeHaan,
CEO of
the
International
Warehouse
Logistics
Association,
said in
a recent
letter
to John
Porcari,
port
envoy
for the
White
House
Supply
Chain
Disruptions
Task
Force.
Warehouse
owners,
tenant
and
workforce
employers
can be
different
companies,
which
makes
drawing
up new
contracts
to pay
round-the-clock
workers
difficult.
"The
warehouse
cannot
arbitrarily
make
this
decision,"
DeHaan
said.
Moving a
warehouse
to 24/7
operations
adds
another
layer of
risk, he
said.
"For
example,
receiving
a
container
at 6
a.m.
that was
scheduled
for 3
a.m.
delivery
disrupts
operations
for the
entire
day,"
DeHaan
said.
"The
goal of
reducing
container
congestion
over the
next 90
days is
ambitious."
Reporting
by
Nandita
Bose in
Washington
and Lisa
Baertlein
in Los
Angeles;
Editing
by
Heather
Timmons
and
William
Mallard
Our
Standards:
The
Thomson
Reuters
Trust
Principles.
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