By Arthur Chen       Photo : Andy Li 

Due to congestion not yet solved, Ocean freight will be maintained at a high level in 2022.

In my article on October 22nd, pointed out that the Biden administration strongly intervened in the 24-hour operation of the ports of Los Angeles and Long Beach last week, the number of waiting and unloading vessels at the two largest U.S. ports reached a record of 100 on last Monday. According to the Marine Exchange of Southern California, the total number of ships recorded at near the ports of Los Angeles and Long Beach on Monday was 157. The number of ships waiting to be berthing and unloaded reached 100, which set a new historical record. There are 97 container ships floating on the sea outside the port, and believe those cargo on board may miss this year's holiday shopping season. Due to the backlog of containers in the port, contanier ships usually have to wait several weeks before unloading the containers. This increases the transportation turnover time for containers from Asia, which currently takes about 75 days on average from departure to final destinations. The congestion situation of these two ports is still deteriorating. According to the latest information on the signal platform of the Port of Los Angeles on October 20, there are currently 36 container ships waiting for berths at the Los Angeles anchorage and 14 vessels waiting outside the port. The average waiting time for berth has increased sharply to 13 days. The most exaggerated is that there is a "Sinotrans Bangkok" container ship on record that has been waiting for berthing for 32 days. The number of container expected to arrive in week 43 continues to grow by nearly 5,000 TEU. 

Even U.S. Transportation Secretary Pete Buttigieg has admitted that the problem of backlog in U.S. national supply chains will be continued until next year. He pointed out that the U.S. supply chain cannot keep up with the current strong demand for shipping volumes, saying that the Biden administration is working with the transportation industry to find solutions. In addition to 7/24 port operations, the government is also working with local agencies to expedite the issuance of driver’s licenses to new truck drivers. It is said that the actions of California's emission laws have been accused of contributing to one of this supply chain crisis. Most trucking fleets in the United States do not meet the new emission standards that the state implemented last year. I wonder if under the influence of the port congestion, will the law be revised to increase the number of trucks ?  In order to improve the domestic logistics supply chain, in the infrastructure design of the Biden government, US$17 billion will be spent on the port alone. There are also other funds that are prepared to invest in railway and road capacity overloaded problems in order to resolve the bottleneck crisis. But many of the challenges faced by the United States this year will continue into next year. Construction projects cannot be completed in a short period of time. Therefore, various timely solutions must be sought. Another reason for the shortage of port congestion is the number of container chassis. This shortage related to the punitive tariffs against China since the Trump era. The cost of buying chassis from China is more than three times higher than before the punitive tariffs were imposed. This is also one of the items that may be included in the US trade negotiations to reduce tariffs. The severance of the logistics supply chain in the U.S. has been caused by many direct and indirect factors since the beginning of the pandemic.

According to Sea Intelligence's opinion released earlier this month, the problem of US port congestion will be alleviated by the end of the second quarter of 2022, but the problem of supply chain incomplete connection will be continued throughout 2022. In addition, scholars predict that the container shipping market will continue to be in short space supply in 2022, but the condition between supply and demand will be changed from 2023, because many new container ships will be delivered and launched in 2023, which will increase the risk of excess capacity. The forecast for the future of ocean freight is correspondingly to be maintained at a high-end in 2022. The shipping lines long-term sea freight contracted prices will probably be the same as in 2021, but the real-time market price should not exceed 2021. It can also be said that the crazy high-price party in 2021 will be the extremely unique in the shipping market in decades. Unless there are other unforeseen disasters in the future, such as another pandemic or global war. To be simply say, U.S. port congestion has caused shipping schedules disordered, which is not something that shipping lines can solve. It will take a long time for American infrastructure to be improved. The Biden government hopes that the infrastructure-construction plan will be carried out. Although it is said that the current messy will not have immediate solved, but the effect will gradually appear after 2022. In order to prevent the United States from falling into stagnant inflation, the US Congress must pass Biden's plan. In fact, the sooner the better.

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