Port of Los Angeles Sees Significant Boost in Cargo
The Port of Los Angeles saw a 16% increase in cargo during the month of November, with 884,315 twenty-foot equivalent units moving through the port. This significant boost in cargo is expected to continue, with Executive Director Gene Seroka stating that the port is "well on pace to exceed 10 million container units (in all of 2024) for only the second time in our 117-year history."
Factors Contributing to Strong Numbers
Several factors are contributing to the strong numbers at the Port of Los Angeles. Consumer spending is a major factor, with many retailers front-loading shipments in anticipation of the holiday season. Additionally, the prospect of tariffs, which could be implemented as early as summer, is also driving up demand. The ongoing unrest in the Middle East, which is impacting routes in the Red Sea, is another factor that is expected to continue to affect the port’s operations.
Industry Landscape in 2025
Scott Kelly, vice president of Ocean Services for the Americas at Expeditors International, one of the world’s largest logistics companies, appeared alongside Seroka during the briefing. Kelly stated that most of their customers are in a "wait and see" mode, trying to figure out what will happen in 2025. He noted that the industry is uncertain about what tariffs will look like, but cargo will continue to move from one country to another. Kelly emphasized that the company’s job is to be prepared for any changes that may occur.
Shippers’ Options
Shippers have several options for avoiding potential disruptions caused by the East Coast and Gulf Coast dockworker strike. One option is to divert East Coast-bound cargo to the West Coast, which some shippers are already doing. Another option is to use air freight, but this comes at a much higher cost. Kelly noted that customers have already been ramping up shipment diversions to other ports, but there hasn’t been a "mass migration" yet.
Challenges in the Shipping World
Ongoing challenges in the shipping world include port infrastructure that will be able to handle "the big, giant ships." Kelly noted that there are limitations to the port’s infrastructure, which will need to be addressed in the future.
Conclusion
The Port of Los Angeles is expected to continue to see strong numbers in the coming months, driven by consumer spending, the prospect of tariffs, and the ongoing unrest in the Middle East. While there are challenges in the shipping world, the port is well-positioned to handle the increased demand.
FAQs
Q: What is driving the strong numbers at the Port of Los Angeles?
A: Consumer spending, the prospect of tariffs, and the ongoing unrest in the Middle East are all contributing to the strong numbers.
Q: What are shippers doing to avoid potential disruptions caused by the East Coast and Gulf Coast dockworker strike?
A: Some shippers are diverting East Coast-bound cargo to the West Coast, while others are using air freight, although this comes at a higher cost.
Q: What are the ongoing challenges in the shipping world?
A: Port infrastructure that will be able to handle "the big, giant ships" is one of the ongoing challenges.
