Covid Slows Efforts to Ease California's Historic Port Logjam
Comment of the Day

February 16 2021

Commentary by Eoin Treacy

Covid Slows Efforts to Ease California's Historic Port Logjam

This article by Robert Tuttle for Bloomberg may be of interest to subscribers. Here is a section:

Southern California ports are grappling with record ship backlogs because of Covid-19 protocols and sick
dockworkers, and the vessels keep coming.

Twenty-nine more ships are scheduled to arrive and anchor at the ports of Los Angeles and Long Beach in the next three days, according to data provided by Capt. Kip Louttit, director of the Marine Exchange of Southern California. A total of 48 vessels were anchored on Thursday, down from an all-time high of
60 on Jan. 28.

“Goods movement ashore to terminals is inefficient because of Covid protocols,” he said.
California’s biggest ports have become the epicenter of pandemic-driven shipping woes in the U.S. as homebound consumers swamp ports with an influx of goods ordered online from Asia.

Peloton Interactive Inc. said Thursday it’s unable to meet surging demand for its exercise machines because of shipping delays in Los Angeles and Long Beach, warning that profit will be squeezed.

Eoin Treacy's view

 I was chatting with a friend on Friday night who is having difficulty importing containers. It’s not at all for the reason one might think. Getting goods on the ship in China is not an issue. Getting them off the ship in Los Angeles is an altogether different story.

The heavily unionized dock workers sector is not testing people for COVID-19. If one person gets sick, they quarantine the whole shift for two weeks on full pay. That is resulting in mass absenteeism which is creating huge delays in supplies reaching their destination.

It’s a symptom of the wider problem in California which is likely to result in governor Gavin Newsom being recalled. The state is managed for the good of the very wealthy and the union workers. Everyone else is ignored. The closing of schools, delays at the port, looking after government employees but making “essential workers” turn up is acceptable.

By all accounts dock workers will now be allowed to skip the queue and get vaccines in order to clear the backlog of ships within the next months.

Together with inclement weather, supply chain disruptions have the potential to put a dent in 1st quarter earnings for a large number of companies.

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