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Home Shipping & Logistics Ocean Freight

How COVID-19 Impacted the Top Ocean Freight Ports in the Americas

Ports saw their volume increase, but keeping up with the onslaught is getting tougher as we move closer to the peak, year-end holiday season.

October 26, 2021
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This post is also available in: Spanish Portuguese (Brazil)

In 2020, the top ocean freight ports in the Americas were all located in the U.S., where Los Angeles, Ca., Newark, N.J., Long Beach, Ca., Savannah, Ga., and Houston, Texas, claimed the top five spots for total TEUs (twenty-foot equivalent units of cargo capacity—a measure used for container ships and container ports).

According to Supply Chain Management Review, all five of these ports saw capacity increases in 2020, a year when COVID-19 negatively impacted supply chains, world economies, entire industries, and individual shippers.

The largest port in North America, the 7,500-acre Port of Los Angeles handled 21% of all incoming cargo for the U.S. in 2020. Breaking the numbers down, the port handled nearly 5 million TEUs in 2020—up 2.6% over the prior year. Newark’s TEU growth was 8.1%, while Long Beach handled 8.0% more TEUs in 2020 versus 2019. In Savannah, TEUs grew by 3.4% in 2020, while Houston managed 2.2% more ocean freight than it did the prior year, according to SCMR’s numbers.

Elsewhere in the Americas, ports in Itaqui, Tubarão, and Santos, Brazil all saw higher volumes of containers traversing in and out of their facilities in 2020. Ports in Callao, Peru and Cartagena, Colombia also managed a brisk volume of business that spilled over into 2021 as the world’s economies began to move into post-pandemic recovery mode.

Managing Disruption

According to SCMR’s Patrick Burnson, China’s rapid reemergence from initial pandemic-related lockdowns combined with a surge in consumer durables demand and transport of medical supplies in late-2020 drove up total inbound handling to 2.93 million TEUs for the U.S.’s top port. This represented a 1.7% increase over 2019.

“U.S. container seaports endured a series of disruptions caused by the COVID-19 pandemic in 2020,” Burnson writes, “but then ended the year with a record level of volumes handled.” Much of that increase can be attributed to Chinese ports’ quick recovery from the pandemic.

Art Chrapko, Vice President, Head of Ocean at DB Schenker USA said, “As economies reopened, the scales tipped in the other direction, with supply chain shortages, labor issues, and congestion all impacting ports across the Americas. Through it all, the pandemic continued to impact countries around the world.”

In March, the Ever Given’s blockage of the Suez Canal further challenged the shipping environment. With many ports already experiencing unprecedented congestion levels, this event further exacerbated an existing problem for shippers and carriers alike.

“The ports struggled to keep up with congestion starting on the west coast and spreading from there as the container lines raced to accept deliveries,” Burnson writes, “but then had to wait for delivery slots as port managers sought to keep up with equipment shortages and the overriding need to keep staff safe and healthy.”

U.S.-Brazil Port Snarls

JOC says problems are also apparent on the U.S.-Brazil leg of the trade, where a trucker shortage (particularly around the Port of New York and New Jersey) is forcing South American shippers and forwarders to make container ship bookings up to a month before U.S. departures, to ensure containers arrive at the load port in time.

According to JOC, freight forwarders in Brazil have seen the length of time between container booking and vessel departure increase. “For ports of loading in the U.S., we need to make bookings three or four weeks in advance to ensure we get sufficient trucking capacity to meet vessel departures. Previously it was one or two weeks,” one freight forwarder in Brazil told JOC.

“Currently, the New York region is one of the worst affected to schedule deliveries to terminals, due to the lack of trucking capacity to pick up full containers,” the forwarder continued. “Normally it takes two weeks to get trucks through independent trucking companies and more or less a month if we deal directly with the carriers.”

No Relief in Sight Yet

Right now, Bloomberg says U.S. ports are struggling to work through bottlenecks of goods imported on container ships, while the rail and truck networks that disperse them across the country are strained with equipment and labor shortages. “The supply snarls are colliding with a surge in demand for goods as the world’s largest economy heads for peak shipping season—July and August,” the publication adds, “when retailers build inventories heading into the year-end holidays.”

“I definitely think it will hit a ceiling at some point but back-to-school, through the fall, Christmas probably, you’re going to see into 2022 when you finally see a slowdown, and maybe not even then if there’s enough of a backlog,” the Federal Maritime Commission’s Dan Maffei told Bloomberg, noting that the current, tight market potentially poses medium-term difficulties and is not a short-term issue.

“We have a system that is at or beyond capacity, pretty much everywhere in the world,” Maffei added. “The carriers have everything they have on the water and still don’t have enough space on the ships for all the demand.”

Tags: FeaturedOcean
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