As shipping woes drag on, businesses search for alternatives

As shipping woes drag on, businesses search for alternatives
Jackie Northam October 21, 2021 https://www.kgou.org/business-and-economy/2021-10-21/as-shipping-woes-dr...

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Many of the nation's largest ports are deeply congested. Massive container ships are having to wait days and days and days to get unloaded, which means you have to wait longer for the things you bought and companies have to wait longer for critical supplies. It's all created a big supply chain crisis. With no end in sight to the delays, retailers and ship owners are starting to look for alternatives. NPR's Jackie Northam has the story.

(SOUNDBITE OF CONTAINER SHIP CLANKING)

JACKIE NORTHAM, BYLINE: There are a lot of moving parts when it comes to unloading containers from massive cargo ships like the one here at the Port of Baltimore. Thick cables unspool from giant wheels on cranes that tower 425 feet above the waters of the Chesapeake Bay. Containers are plucked from ships and dangle above the quay before being gently lowered onto a waiting flatbed truck.

(SOUNDBITE OF CONTAINER SHIP CLANKING)

NORTHAM: About a decade ago, the Port of Baltimore underwent an expansion, dredging the channel and investing in the supersized Chinese-made cranes so the port could accommodate much bigger ships. William Doyle, the port's executive director, says that expansion continues.

WILLIAM DOYLE: And if you look, there are four brand-new cranes that just came in. They will all be operational in January.

NORTHAM: Doyle says the timing of the new cranes couldn't be better for the Port of Baltimore. It's trying to attract more shipping companies that are tired of the long delays at other ports. Doyle says two major companies recently started bringing more of their ships here. He expects more will follow.

DOYLE: Would you send your cargo into the West Coast right now? No, of course not. You'd try to find another area to bring it to. And I think that's what's happening now.

NORTHAM: The big ports, such as Los Angeles and Long Beach, can take in much larger ships than the Port of Baltimore. At the prompting of the White House, the two ports agreed to start working 24-7. But with congestion at an all-time high, retailers and shipping companies are still looking for alternatives.

Jess Dankert is vice president of supply chain for the Retail Industry Leaders Association, which represents more than 200 large companies, including CVS, Walgreens and Lowe's. She says some retailers are looking at using smaller ships to go to smaller ports.

JESS DANKERT: All of our retailers are, again, collaborating with their suppliers, with their, you know, carriers and logistics service providers to find ways to flex those supply chains, reroute around particular areas of disruption.

NORTHAM: But shipping is tightly integrated across the world. Even if you reroute, there's no guarantee the cargo will show up on shelves anytime sooner. Lars Mikael Jensen is responsible for running a global network of vessels for Maersk, the world's largest shipping company. He says long delays are happening everywhere.

LARS MIKAEL JENSEN: Obviously, U.S. West Coast is the worst at the moment. In Europe, it's the big U.K. port of Felixstowe. There you wait up to a week if you come with a big ship. Then in Shanghai and Ningbo, maybe you wait two or three or four days.

NORTHAM: Jensen says Maersk has more than 700 ships of all sizes on the water right now and is planning to bring on more.

JENSEN: Every ship that is capable of sailing and can do that in a safe manner is out sailing unless they are waiting to get alongside.

NORTHAM: Dankert says some large retailers are looking for their own ships to charter.

DANKERT: That's not a solution that's necessarily available to everyone or that's a fit for everyone.

NORTHAM: That's because shipping costs, the freight rates, have gone through the roof. Peter Tirschwell is a maritime trade specialist at IHS Markit, a global information and analytics firm.

PETER TIRSCHWELL: Even though the reliability of the service has greatly deteriorated, the freight rates are now - you know, pre-pandemic they would have been maybe $2,000 or less to ship a container, say, from Shanghai to Los Angeles. Now, though, those rates are, you know, north of $20,000.

NORTHAM: Despite the soaring costs, the demand for consumer goods is still high, which means the whole shipping industry is going to have to continue to find new and quicker ways to get goods to consumers.

Jackie Northam, NPR News.

(SOUNDBITE OF WE CAME FROM THE NORTH'S "TALL CRUISE") Transcript provided by NPR, Copyright NPR.