Americas News
Survey Finds Just Under Half of Shippers Will Divert Cargo Away From U.S. West Coast
A survey has found that almost half of participating shippers have indicated plans to shift cargo from U.S. West Coast ports to East Coast ports following an extended labour dispute which caused congestion all along the West Coast, JOC reports.
According to the survey, 43 percent of shippers who negotiated annual trans-Pacific contracts said that they would be transferring shipments to the East Coast, though half of those respondents said that less than 5 percent of that freight would be permanently diverted.
Reports also noted that an earlier survey had found that 65 percent of surveyed shippers planned to divert cargo this year or next year.
In the process, rates in East Coast ports have reportedly risen, with a third of surveyed shippers claiming increases of more than 3 percent.
However Dennis Melgert, director of global logistics for Oman-based Octal, noted that "West Coast rates are under pressure because the carriers are trying to get their customers back, so those rates are pretty stable."
JOC's findings come in contrast to figures released Wednesday by the Port of Long Beach, who reported that cargo volumes increased 4.8 percent in May compared to the same time last year, marking the busiest May since 2006.
Volumes at the port are also reportedly up 1.1 percent overall through the first five months of 2015.
The port said that a stronger retail market has been driving gains, and that it was currently in the process of attracting new services to boost growth.
Earlier this year, the Port of Los Angeles voiced concerns about permanently rerouted cargo, especially as roughly a third of the port's cargo is discretionary.
