Supply chain bottlenecks are easing as fewer shipping containers are anchored off the ports of California, but a persistent shortage of truck drivers and the impact of the latest variant of Covid-19 still remain hurdles.
Delays in shipping and procuring materials have played a major part in the rising levels of inflation in the U.S.
But there are signs of improvement this week, with the number of container vessels that are anchored by the Ports of Los Angeles and Long Beach decreasing substantially.
On Dec. 8 there were 30 vessels anchored at the two ports, down from more than 80 at the peak of the area’s congestion, according to CNN. In November, there were 86 container vessels waiting near Southern California’s ports.
The current data indicates supply chain issues are improving, Matt Colyar, an economist at Moody’s Analytics, told CNN.
“I’m increasingly confident that the worst appears to be over,” he said.
At least 60 vessels from Asia are waiting in deeper waters hundreds or thousands of miles away. The ships are now traveling at a lower speed from Asia to help avoid congestion.
Their route now takes 22 to 24 days compared to 10 to 14 previously, said Jim McKenna, chief executive of the Pacific Maritime Association, which represents West Coast terminal operators.
Despite the promising signs that shipping delays are improving, a hiccup has emerged: The ships are now adhering to a new voluntary system that was created in November by maritime officials, according to the Wall Street Journal.
Officials are concerned that a large number of vessels waiting to dock would be impacted as strong winds create rougher seas in winter weather.
The container ships are very tall and tend to “blow around a lot” due to the heavier winds, Kip Louttit, executive director of the Marine Exchange of Southern California, which monitors ship movements, told the WSJ.
The ships are now being spread out and reducing their speed in the area.
Part of the delay is being fueled by a large increase in demand.
The neighboring ports handled 7.7 million loaded import containers between January and September, which is a rise of 21% from the same period in 2019, according to Beacon Economics, a research and consulting firm.
The backlog of orders index in the Institute for Supply Management’s manufacturing survey dipped to 61.9 in November, a decline from a record high of 70.6 in May.
