• 07-12-2021

Global Port Congestion updates

Hundreds of ships stuck near the world's largest ports, especially on the West Coast of the US. This prolonged global port congestion, caused by the inability of the biggest ports to handle all arriving ships.

We already discussed the causes and consequences of port congestions in the previous article. Let dive into some of the main reasons behind the port congestion.

During these pandemic situations, people changed their lifestyle by spending habits from paying for services and experiences to commodities and products. As a result, the demand for consumer products increased rapidly within the last year, making it exceedingly difficult for carriers to meet the need. Therefore, the United States is receiving record volumes of import goods, producing port congestion and a severe container scarcity.

Other factors contributing to the problem include:

  • labour deficiency in warehouses

  • lack of skilled truck drivers

  • shortage of dockworkers

  • vessel bunching

  • slow productivity

  • holiday shopping demand

Container shipping costs rise due to high demand. Which effects in storage and port operation fees increases, reducing profits around the world.

Due to this port congestion, empty containers are in short supply in locations where they are needed. As a result, some carriers are neglecting stops to avoid congestion, which leaves many empty containers not being picked up on time.

Finally, there is a shipping letup that is having a significant impact on global supply chains. The massive wavering will continue in future as the holiday season will increase demand. Transportation costs will likely increase due to higher freight costs, port fees, and month-long delays.