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America's supply chain is increasingly fragile, and port congestion remains a problem

America's supply chain is increasingly fragile, and port congestion remains a problem

2022-08-12 11:19:22

America's supply chain is increasingly fragile, and port congestion remains a problem

Strikes, epidemics and more are hitting U.S. ports. When there is too much cargo in western ports, many ships choose to take a detour, which has led to a surge in cargo in eastern ports as well, and a wave of strikes at American ports this year has made the American supply chain more vulnerable.

In mid-to-late July, massive strikes took place at the ports of Los Angeles, Long Beach, and Oakland. Some of the gates were temporarily closed before the protest began, delaying the delivery of goods. The three ports account for half of all U.S. cargo, according to Rammat.

The main reason for the strike is the country's truck drivers' opposition to AB5. AB5 is a trade union act in the state of California that went into effect on January 1, 2020. The bill requires independent contractors to reclassify the truckers as employees, thereby monitoring the hiring of temporary workers. Opposition to the bill has been so strong that trucking companies have moved their operations out of the state in protest, further straining the state's already fragile supply chain

On the other hand, container accumulation at U.S. ports remains a serious problem. In mid-July, the number of imported containers at Southern California yards neared a peak, and the backlog at Changnang surpassed last year's record high, bringing renewed attention to the problem.

America introduced a "holdup fee" last year to speed up the flow of containers, but the policy has been repeatedly delayed, with the ports of Long Beach and Los Angeles putting off consideration of the fee.

From the current situation, when the cost can be fully landed, port congestion when the problem can be solved are unknown. However, it must be admitted that in terms of shipping, whether it is freight rates, container charges, or ship waiting time, smooth transportation and so on did ease compared with last year. However, before shipping or to make a good plan in advance, in case of need.