New Long-Dwelling Cargo Emergency Fees applicable at US West-Coast ports

6. desember

UPDATE 6. December: Postponement of Dwell fee implementation at Los Angeles/Long Beach port terminals

 

Further postponement of implementing fees at Long Beach/Los Angeles ports

The Los Angeles port terminals still hold the implementation of the Long-Dwelling Cargo Emergency Fees as containers sitting in the port decreases week by week.

North West ports of California – Tacoma and Seattle now implementing harsher fees

To further motivate cargo owners to pick up containers after release the port terminals of Tacoma and Seattle introduces harsher temporary container storage fees. Should a container still be sitting in the port 5 days after being made aUSD 150.  The fee is introduced as of Dec. 1-2021. The fee is applicable for containers being picked up at terminal 5, 18 and 30 according to cargo handling company SSA Marine.

Read more: Extra storage charges Seattle and Tacoma

 

New strategy from shipping line CMA CGM to incentivize cargo owners to pull containers faster

CMA CGM wants faster turnaround of containers from arrival Los Angeles ports till re-export and has therefore as first of its kind introduced a rebate for cargo owners of up to USD 200/container if containers are picked up within 8 days after arrival at terminals. The USD 200/container is valid for pick up at nighttime and weekends whereas day time pick ups are releases a rebate of USD 100/container.

Read more: CMA CGM Incentive program

 

The infrastructure in USA was challenged prior to Covid-19

Vessels outside Los Angeles are still queuing up to as much as 75 – 100 container vessels. Containers are piling up in the ports and it slows down the processing time.  Terminals refuse to accept empty containers, so they stay in truckers’ yards, occupying valuable chassis.  Drivers wait for many hours in lines to get containers, and because of the wait time they turn around 1 container per day instead of 2 or 3.  Some of the larger importers who have contractual beneficial deals for storing the containers beyond normal free time for storage has now become an even further pain for the port terminals. To incentivize all importers to pick up containers as quickly as possible (including during the less desirable operation times during nights and weekends) the port authorities are imposing below mentioned fees.

There is an ongoing discussion between importers, Port terminals, shipping lines and the Federal Maritime Commission (FMC) whether these fees can be applied according to law. The outcome of this discussion remains to be seen.

Please reach out to your local day to day contact, we are more than happy to speak with you and answer any questions you may have.

UPDATE 16. November: Postponement of Dwell fee implementation at Los Angeles/Long Beach port terminals

On Monday 11/15 the port authorities in Los Angeles and Long Beach announced that they were delaying the effectuation date of the dwell fees initially set for 11/15, due to positive development at the terminals. A 26% decrease in containers dwelling past limit compared to when the initial announcement of the penalties.

“We’re encouraged by the progress our supply chain partners have made in helping our terminals shed long-dwelling import containers. Clearly, everyone is working together to speed the movement of cargo and reduce the backlog of ships off the coast as quickly as possible,” said Port of Long Beach Executive Director Mario Cordero. “Postponing consideration of the fee provides more time, while keeping the focus on the results we need.”

The expected use of the dwell fees collected is reinvestment in programs designed to enhance efficiency, accelerate cargo velocity and address congestion impacts. As it stands now, the ports will delay consideration of the fee until November 22, 2021.

LEMAN will continue to monitor the situation, and provide information to our customers as soon as they become available.

In the meantime should you have any concerns, please feel free to reach out to your local day to day contact - we are more than happy to speak with you and help answer any questions you may have.

New Long-Dwelling Cargo Emergency Fees applicable at US West-Coast ports


Following the most recent introduction of emergency fees in Los Angeles (LA)/Long Beach (LB) ports, Pacific North West (PNW) port terminal will be following suit, with what they brand long stay rehandling fees.

Towards the end of October an announcement was made by white house staff, confirming early November emergency congestion fees would be implemented for containers at Southern California ports, LA, and LB.

Specific to LA/LB port terminals the fee will be applied to all container yard, local haulage, and off-dock rail containers that remain at the terminal for nine days or more and on-dock rail containers that remain at the terminal for three days or more.

Source: American shipper




Dwell time for local container yard units is limited to 8 free time days, billing begins on day 9. 

Dwell time for on dock rail units is 5 free time days, billing begins on day 6.

As indicated in the graph above, the fee is $100 per unit on the first day past the dwelling limit for both terminal and rail. The fee will increase by $100 for each following day. These long-dwelling related costs is separate from any carrier contracted and filed demurrage free-time and associated costs. The newly introduced fees are collected by the Ports of LA and LB and is intended for the carriers. The expectation in the market is that the costs will be presented as pass through to the importers, although there are already indications in the market that this will be disputed on a greater scale.

The fee listed has been implemented as a 90-day policy, which took effect on November 1st 2021. 

Although the emergency fees were introduced on November 1st, fees will not be implemented until November 15th.

According to the Port of LA, “Starting Monday, we will be taking daily data snapshots of how long import containers sit on our container terminals,” said Port of Los Angeles Executive Director Gene Seroka, according to Freigthwaves.com. “If progress is being made clearing our docks, I have the discretion to delay the start of fees beyond Nov. 15. Our goal is to see significant improvement on our docks so that we don’t need to administer any fees.”  

Specific to the measures taken in the PNW region, fees being implemented for long-dwelling cargo in Seattle terminals Washington United Terminals (WUT) & Huskey, have taken effect as of November 1st, fees will be implemented as of November 15th , 2021.

For WUT Terminal this will pertain to all local import units, having exceeded 15 calendar days on the terminals, and will incur a 310$ long stay rehandling fee. Units will be placed on hold and payment will be due prior to making an appointment. This action is designed to encourage the rapid movement of local import containers.

For Husky Terminal the measures introduced to encourage improved velocity are effective November 1st, 2021, all local import units that have exceeded 15 calendar days on the terminal will incur a $315 Long Stay Rehandling Charge. Payment will be due prior to release of cargo.

Even if the West Coast ports of USA are severe bottlenecks, we urge you to engage in a close dialogue with your customer to ensure they can plan best possible given the circumstances.

Rest assured LEMAN is working diligently on minimizing the effect of the implemented charges to our customers, we are engaged in dialogue with local partners/industry peers & vendors and will continue to push for solutions for each individual situation to the best of our ability.

A few things we already do to minimize the risk for you and your customers:

  • Customs clear your cargo in advance of arriving at port.
  • Prebook the delivery as early as possible and reconfirm the booking of delivery once shipment is released from customs and ready to move.
  • Focus and follow up on each and every shipment.
  • Keep your stakeholders advised of when they can expect cargo to be delivered.

Please reach out to your local day to day contact, we are more than happy to speak with you and answer any questions you may have.