Containers Piling Up at U.S. Rail Yards Add to Port Strains



© Reuters.

(Bloomberg) — To understand why more than 100 container ships are waiting to enter U.S. ports from Southern (NYSE:) California to Savannah, Georgia, it helps to keep tabs on the congestion that’s building at another key junction of freight transportation: rail yards.

The so-called dwell time for containers at 11 major railroad depots reached an average of 9.8 days this month, according to a tally of its own boxes maintained by Hapag-Lloyd AG, the world’s fifth-largest container carrier. That’s up from 6.7 days in May and 5.9 in February.

Leading the pack is Los Angeles, where containers wait an average of almost 16 days before being picked up. The delays are also surging in Charleston, South Carolina, and in Detroit. The numbers show some improvements in Long Beach, California, and Kansas City.

In its emailed note this week, Hapag-Lloyd said port officials are extending operating hours to nights and weekends to ease pileups in intermodal lots jammed with both full and empty containers. The delays through the ports of Los Angeles and Long Beach in particular, it said, “are expected to continue for the remainder of the year.”

On top of the strong demand for imports, a big part of the problem is a shortage of truck drivers to collect and drop off the 20- and 40-foot steel boxes, as executives of packaged good giant General Mills Inc (NYSE:). pointed out during an earnings call Wednesday.   

“So we have literally hundreds of disruptions in our supply chain and it really changes on a daily and weekly basis,” said Jonathon Nudi, group president of North America retail at General Mills. “The bulk of our discussions right now with retailers are really around service and making sure that we can ship the product that our consumers are ultimately looking for.”

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