“Sweeper Ships”, ships deployed for the purpose of picking up empty containers for repositioning, have for years been an instrument in the ocean carriers’ tool box to balance container flows in extreme circumstances. With the introduction of $100 “Excess Dwell Fees” at ports of Los Angeles and Long Beach to address pile up of empty containers, it appears these are extreme circumstances.
Gene Seroka, executive director of the Port of Los Angeles says ocean carriers are dispatching empty container ships or so-called “sweeper ships” to the Port to move empty containers off the docks and back to Asia so as to relieve congestion.
On October 29th, Seroka told Port Los Angeles Harbor commissioners that the pile up of empty containers has been a major cause of the congestion crisis at the Southern California ports. Empty containers have been accumulating at Los Angeles in part because they are being transported from other ports “because it is the shortest water distance back to Asia.”
Matt Schrap, chief executive officer at the Harbor Trucking Association (HTA) told AJOT that empty containers are coming to Southern California from ports outside of California and as far as Atlantic coast ports making a bad situation worse: “We’re taking empty containers from all over the country because it is a shorter water route for carriers. So now we have local empties competing with empties from Prince Rupert (British Columbia), from Chicago, from Savannah, from Houston. They’re coming to LA/Long Beach which is gumming up the works.”
Promise of Sweeper Ships
Seroka said that he has had positive responses from several ocean carriers including COSCO and Hapag-Lloyd. Both carriers have promised to send sweeper ships to help transport empty containers back to Asia.
Seroka told the commissioners that he hopes to persuade one ocean carrier to temporarily redeploy several 23,000 twenty-foot unit mega container ships away from the Asia to Europe trade and to the Port of Los Angeles so as to pick up the empty containers and transport them back to Asia.
A spokesman for the Port of Los Angeles could not provide details as to how many sweeper ships will be deployed, how soon they would arrive and whether they would be given priority on arrival to move the empty containers back to Asia.
At the October 29th meeting, the Los Angeles Harbor Commission voted 4-0 to implement a “Container Excess Dwell Fee” directed at ocean carriers in an effort to improve cargo movement on container terminals amid record volume. The program started on November 1st with penalties to be assessed no earlier than Nov. 15.
Matt Schrap, said the imposition of surcharges on the ocean carriers has motivated the carriers to become more “engaged” in solving the congestion problem, although, he believes the fees will ultimately be passed on to the shippers.
He says that level of carrier engagement has also increased as a result of meetings that John Porcari, Port Envoy to the Biden-Harris Supply Chain Disruptions Task Force, has had with the ocean carriers.
Schrap supports the deployment of sweeper ships as this has been a successful strategy in the past.
He points out that whenever a large backlog of empty containers accumulated at the Los Angeles and Long Beach ports, they could be repositioned back to Asia by the dispatch of an empty container vessel or “sweeper ship.” The ship would dock at Los Angeles or Long Beach and pick up the backlog of empty containers.
Getting Containers off Chassis
Sweeper Ships aren’t a new idea, but taking a ship out of rotation just to pick up empties is a container repositioning strategy of last resort for ocean carriers. Schrap said the deployment of new sweeper ships had not materialized up until now, because the ships were either not available or they are delayed due to the traffic jam at the two ports: “We still need that sweeper ship. You talk to the old timers and they tell you that’s the way it used to be. It’s an operational cost that the carriers would absorb but the sweeper ship needs to wait in line.”
Seroka’s announcement on Friday (October 29th) indicates that the carriers have gotten the message and will be sending sweeper ships soon.
Schrap said that it is vital to move empty containers off the docks and free up chassis that are under the containers so that harbor truckers can increase the velocity of pick-ups and deliveries: “We need to get these empty containers off the chassis, we have been saying this for months. Now it’s finally beginning to resonate.”
Schrap said, “We want to get these goods off of these ships. We want to get that backlog cleared, get the cargo out to the people who need it. Warehouses and large shippers have committed to keep operations opened, but it doesn’t matter if you can’t get a chassis.”