KOTRA Hosts Webinar on Solutions for West Coast US Port Logistics Congestion

Local Expert Advises "Seek Alternative Ports and Use Logistics Warehouses to Increase Inventory"

Participants, including Sangil Noh, Vice President of the Korean American Logistics Association (KALA) (second from left), and Hoseok Kim, Busan Port Authority's North America Representative (third from left), who spoke at the webinar "Outlook and Response Measures for Logistics Congestion at West Coast Ports of the U.S." hosted by KOTRA, are taking a commemorative photo.
[Photo by KOTRA]

[Asia Economy Reporter Kim Heung-soon] As the logistics congestion at ports on the U.S. West Coast continues, local logistics experts advised Korean companies to change their ports of entry to those with relatively less congestion and to increase local inventory in preparation for a prolonged logistics crisis.

KOTRA held a webinar titled "Outlook and Response Measures for Logistics Congestion at U.S. West Coast Ports" on the 17th, inviting two local Korean logistics experts to discuss these issues.

About 100 Ships Waiting Offshore at Los Angeles and Long Beach Ports
Port Congestion Expected to Continue Until First Half of Next Year... Possibility of Prolonged Delay

At the Port of Los Angeles (LA) and Long Beach, the largest ports in the U.S. handling 40% of containers entering the country, about 100 ships are currently waiting offshore unable to dock. As a result, the waiting time for ships to enter the port has increased from about 6 days in mid-August to recently 13 days, with some ships observed waiting for over a month.

Delays in cargo handling at the ports have also led to containers piling up at terminals. Kim Ho-seok, KOTRA’s representative for the Americas at Busan Port Authority, said, "When I visited the LA and Long Beach ports, I could visually confirm the serious situation. Containers that were usually stacked 3 to 4 layers high are now piled 5 to 6 layers, and the container yards are full."

The severe cargo congestion is due to a surge in cargo volume driven by the U.S. economic recovery, while the shortage of port labor and equipment since COVID-19 has not been resolved, causing the ports’ cargo handling capacity to lag behind the rapidly increasing cargo volume.

Experts predict that congestion at U.S. West Coast ports will be difficult to resolve in the short term. No Sang-il, Vice President of the Korean American Logistics Association (KALA), said, "The congestion is expected to continue until June next year when the West Coast port union contracts expire. If the contracts are not properly renewed, the congestion may only ease after the first half of 2023."

Korean Companies Should Change Ports of Entry and Increase Local Inventory

Kim recommended using ports such as Oakland or Seattle, or East Coast ports, which have less congestion than LA and Long Beach. He emphasized, "Especially, cargo volume at the Port of Oakland has been decreasing for three consecutive months, so there is more capacity than usual. Since cargo ships operate nine times a week between Busan Port and Oakland Port, it can be a sufficient alternative."

Advice was also given to establish new logistics strategies from a mid- to long-term perspective to prepare for a prolonged logistics crisis. Vice President No advised, "It is necessary to secure sufficient inventory by utilizing warehouses within the U.S. and also consider relocating production bases to the U.S."

Kim Tae-ho, Director of KOTRA’s Economic and Trade Cooperation Headquarters, said, "We are carefully monitoring the logistics congestion status at major ports through KOTRA overseas trade offices located in the U.S. We will provide multifaceted support such as operating overseas joint logistics centers and logistics-exclusive export vouchers to minimize damage to our companies."

The webinar video is available on the "KOTRA Business" YouTube channel.

This content was produced with the assistance of AI translation services.