Where Did All The Ships Off LA and Long Beach Go? We Found Them!
If you are wondering what happened to the supply chain problem, it’s not exactly gone, but it’s being handled by the shipping companies. As for costing a lot of money, rest assured, the solution is costing a lot of money. The rates are down but still high.
The ports of Los Angeles and Long Beach are not full. The smaller ships are not coming in, but the larger ones are, but not very many. So, where are they?
Fearing a longshoremen strike, everyone shipped early, and many of the 3rd quarter goods were shipped in the first two quarters.
Also, shippers decided to diversify. The new lane in the Panama Canal allows the larger container ships to pass through. So, shippers are going through the Canal. Some are heading for Europe, where they put the goods on smaller ships to the United States. It’s not cheap, and shippers don’t appear interested in seeing the rates go down too much.
Freight rates have come down significantly, but they are still very high. Where will it level off? Look at how low they were pre-COVID in the chart below. The Ocean carriers are slowing down their passages to diminish the supply to back up the freight rates. They are also going to head elsewhere. This will raise rates. Increasing fuel prices will raise rates. The rates probably won’t go back to pre-COVID rates. Shippers don’t want that. They made $60 billion with the high rates.
Many ships that usually head for the West Coast are heading for the East Coast. The supply chain issue hasn’t gone away.
The comments on youtube were interesting. They addressed inflation, California regulations, slow steaming, and COVID shutdowns in China.
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