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Global Supply Chain News: Now Port of New York and New Jersey to Assess Fees for Overly Long Container Storage

 

 

Similar Plan at LA and Long Beach Never Turned On as the Threat Worked

 

Aug. 3, 2022
SCDigest Editorial Staff

 

Last fall, the ports of Los Angeles and Long Beach announced very high fees for containers not moving for more than nine days at the port complex – but the fees were never implemented, as the threat quickly led container dwell times drop significantly.

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The Authority also said the fees will offset the costs of providing additional storage capacity and other handle expenses due to “the glut of empty containers.”

 
 

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Now, the Port of New York and New Jersey is launching a similar program in an effort to reduce congestion in handling shipping containers.

This week, the port announced that both loaded and empty containers that exceed a set number of storage says will be hit a quarterly “container imbalance fee,” effective as of September 1.

Like others, the Port of New York and New Jersey handled record levels of import containers during the pandemic and beyond. That led to longer container dwell times at the terminals. The congestion in turn has reduced port productivity.

The slowdown in container flow has led to delays loading and unloading, causing ships to anchor at sea for several days awaiting a berth at a terminal.

Under the new fee regime, ocean carriers that do not move empty containers out of the port will be charged $100 per container. The port’s new container export levels mandate that export volumes must equal or exceed 110% of an ocean carrier’s incoming container volume during the same period. If that benchmark is not met, the ocean carrier will be assessed a fee of $100 per container for failing to hit this benchmark

Although the number of full containers applies toward the quota too, the fines are primarily targeting the high number of empty containers that are causing the port congestion and lower productivity.

This situation is caused in part because containers often accumulate in at the port because it is the first port of call for many ships working the East coast. With ships full of container headed for southern ports such as Savannah, the ocean carriers often have left empty containers at the port rather than taking them back.

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The Port Authority of New York/New Jersey said in a statement the fee is especially needed because the agency expects to “handle record cargo volumes spurred by peak cargo season and a cargo shift from the West Coast.”

The Authority also said the fees will offset the costs of providing additional storage capacity and other handle expenses due to “the glut of empty containers.”

But interestingly, the new fees come after an action by port trucking firms and shippers asking that the US Federal Maritime Commission waive any per-diem fees related to empty containers due to the difficulties of returning them to the port.

The Port of New York and New Jersey is the largest port on the East coast and the third-largest in the US, behind LA and Long Beach.

What are your thoughts on these new container fees ? Let us know your thoughts at the Feedback section below.

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