It is reported that on Friday local time in the United States, the port committees of the Port of Los Angeles and the Port of Long Beach unanimously approved a plan to charge carriers a Container Excess Dwell Fee, which will take effect on Monday.
Charge standard: Under the 90-day policy, for containers planned to be transported by truck locally, from staying at the port Charges start on the 9th day (note: the free stay for container delivery is 8 days, and the free stay for rail transfer is 5 days!). Each box will be charged US$100 on the first day overdue, US$200 on the second day, and so on;
For containers planned to be transported by rail, charges will start from the 6th day (the previous notice was from the 3rd day), and the charging method is the same as above.
According to this charging method, on the 5th day after the overdue date, the charge per container is US$1,500, and on the 30th day, the charge per container will be as high as US$46,500. If based on 90 days, it is 409,500 US dollars!
Port: Charge money if you don’t take the goods away!
The port will start counting the time a container spends at the terminal on November 1, but the port will not start assessing fines until at least November 15.
Port leaders said they have the authority to defer the fee if they see progress in moving containers from the terminal over the next two weeks.
The new fee is expected to be charged for 90 days, which is also the current expectation of the United States. Significant improvement must be seen within 90 days!
Los Angeles Port Commission Chairman Jaime Lee said in a statement: “Our goal is not to generate revenue. Instead, we need our supply chain partners to make operational changes , to reduce dwell time, clear the docks, and make room for ships waiting to enter the port.”
Gene Seroka, executive director of the Port of Los Angeles, said: “We tried diplomacy, tried Cooperate, but nothing works. Los Angeles has no choice but to assess the cost of excess stranded containers.”
The shipping company passed the blame; the cargo owner: It’s not my fault, why should I take the blame?
But transpacific shipping companies quickly made it clear that they would not bear the new fees and would instead pass the costs on to retailers who own the product. But the move marks a sea change in the typical relationship between shipping companies and key customers in America’s largest trade lane.
That’s because in the past, shipping companies voluntarily agreed to absorb the storage charges, known as demurrage, levied by ports to attract – and retain – the shipping companies that dominate the trans-Pacific trade lanes. Big box retailer business. But LA-LB’s new fees will test this traditional dynamic.
Jonathan Gold, vice president of supply chain and customs policy at the National Retail Federation, also said:
“There is no doubt that shipping companies will want to pass on the costs. In fact, retailers also want to get the imported heavy containers back from the terminal as soon as possible, but they will still encounter obstacles.”
Jonathan Gold listed the obstacles as the LA-LB port complex being inundated with empty containers, a severe chassis shortage, and restrictions by shipping lines and terminals on the return of empty containers. Until shipping companies and terminals address these issues, the entire issue will remain unresolved.
The biggest concern for retailers and other importers, he said, is whether they should be charged demurrage if they are unable to pick up a container through no fault of their own.
It is reported that the nine-day backlog of goods at the terminal accounts for 47% of all containers in the port. In real terms, this means that 38,000 of the 81,000 containers stacked at the terminals have been backlogged for nine days.
Before last year’s pandemic-induced surge in imports, locally shipped containers spent an average of less than four days at terminals, while those shipped by train spent less than two days. . </p
