California ports delay dwell fee as container flows improve

Southern California’s ports of Long Beech and Los Angeles are delaying the implementation of financial penalties on shipping lines for containers left on marine terminals as the situation appears to improve

Containers are moving out of ports more quickly after threat of financial penalties, so implementation of Container Dwell Fee is delayed until 22 November

Consideration of the so-called Container Dwell Fee will be pushed back until November 22, according to a statement. 

“There’s been significant improvement in clearing import containers from our docks in recent weeks,” said Port of Los Angeles executive director Gene Seroka. “I’m grateful to the many nodes of the supply chain, from shipping lines, marine terminals, trucks and cargo owners, for their increased collaborative efforts.”

Under the new system which was announced in late October, the ports were due to begin assessing a fee of $100 per loaded container from November 15.

The fee will increase by $100 per day for containers that have dwelled at the ports for nine days and are contracted to move by truck, or that have dwelled for six days and are contracted to move by rail.

Before the pandemic-induced import surge began in mid-2020, on average, containers for local delivery remained on container terminals under four days, while containers destined for trains dwelled less than two days, said the statement.

Since the introduction of fines, the twin ports have seen a decline of 26% combined in aging cargo on the docks over the past three weeks.

 “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 measures, developed in coordination with the US government, are part of the efforts by the world’s largest import country to alleviate the logistics bottleneck that has been threatening its supply chain stability.

The move, however, has sparked a heated debate regarding which parties should pay to speed up the US container flows, with the National Industrial Transportation League arguing that carriers should not be allowed to pass on the expenses to importers.