Speaker 1: Outside of the port of Los Angeles, a fleet of container ships is waiting to unload its cargo loaded with things like furniture, laptops, and appliances ships might be at anchor for as long as a week. They're waiting because America's busiest port is backed up too many surviving at once and dock workers canceled, load them fast enough. And it's happened at other ports around the country. In the bay area. The port of Oakland has managed to work through its backup, [00:00:30] but import volumes, there are up 20% this year.
Speaker 2: Uh, the terminals, uh, and labor were, uh, working very hard, but we're having a difficult time keeping up with the demand, uh, for loading containers on and off the ships.
Speaker 1: The problem is us when lockdowns and closures from the coronavirus pandemic meant we couldn't spend money on things like concerts, travel and theater. We spent it on stuff instead, maybe [00:01:00] it was workout equipment supplies or a carpet and comfy chair to outfit the new home office, but whatever it was online, shipping skyrocketed. And so did the amount of things being shipped from factories to stores and your home ocean freight from Asia to the United States now takes an average of 69 days or almost double what it took a year ago. And in some places the congestion is expected to well into next year. So
Speaker 2: COVID did cause a big search in consumer purchasing, which, uh, created this demand [00:01:30] for space, uh, products coming in at a record pace compared to even before COVID at 2019. A lot of volume will cause, uh, congestion at the ports because you can only put, uh, capacity, uh, through a, a, a Marine terminal that has a finite amount of space.
Speaker 1: And the backups aren't limited to the ports, the entire global supply chain from factories and ports in Asia to the trucks and trains that deliver things inside the us is struggling to keep up equipment [00:02:00] shortages and social distancing measures to keep workers healthy are all also to blame and ongoing COVID outbreaks are causing some factories to temporarily close down.
Speaker 2: So I think from a, uh, warehousing standpoint, many warehouses had to impose, uh, uh, COVID restrictions with respects to, uh, social distancing. So they were working with the reduced staff and, um, essentially less space to, to work around. And, uh, and then also here on the, on the docks, they instituted quite [00:02:30] a bit of, uh, cleaning protocols between shifts so that our longshoremen, uh, would be safe as they, uh, came to and from work.
Speaker 1: It takes a complex orchestra of cargo ships, trains, trucks, and aircraft to move the things we order around the planet up until COVID the system largely worked packed into shipping containers or the bellies of cargo planes. Our stuff traveled quickly and efficiently to our doorstep. It's how we got our iPhones, household goods, cars, and clothing, [00:03:00] to get an idea of how it all works. There's no better place than to visit a port like LA or Oakland hidden behind freeways and warehouses are vast terminals with stacks of containers and cranes as high as 175 feet. The huge ships that arrive every day can be as long as the empire state building is high and can carry more than 20,000 containers and to keep on schedule, they need to be on their way quickly. Unloading them is a complex job that takes a team of people and equipment. It starts with a crane driver who plucks the containers off the ships.
Speaker 2: [00:03:30] When the ocean carrier arrives outside the golden gate, our bar pilots will go out and guide the vessel in to birth. Um, at one of our turn ALS once the vessel's birth, our longshore labor will then position cranes and start to unload containers one by one onto trucks, which then move them to their temporary holding locations, which we call stacks. And they're literally just stacks of containers
Speaker 1: For loading a ship. The process is reversed besides sending empty containers back to factories in China enough for even [00:04:00] more stuff. Oakland also exports large amounts of fruits, vegetables, nuts, and rice grown in California's fertile central valley.
Speaker 2: The truck will pull up underneath the crane. The crane operator from a couple hundred feet in the air will lower down the crane and, uh, target the four, uh, locks on the coal owners of the container. Once they're engaged, they'll lift a container back up onto the vessel and place it in the right location, uh, for exports. The interesting thing is, is [00:04:30] that the import process and the export process happens simultaneously as a import container comes off the ship. They immediately will pick up an export container and put it right back into the vessel.
Speaker 1: After a ship is unloaded in the us containers are collected by truck and are taking either to distribution centers or to places called intermobile yards, where they're put on trains, the trains then carry the goods inland to more intermodal yards in the Midwest. [00:05:00] Then it's back on truck for final delivery. It was at these transfer points where backups occurred. If cargo wasn't moved through the system, fast enough, the ports yards and warehouses would simply run out of room and with no room to store it. New cargo couldn't be unloaded. Things got so bad in June that union Pacific had to suspend service between the west coast and its giant yard in Chicago for a week to clear a freight backlog. The congestion has even pushed some companies to ship more things by air. The more expensive air freight is faster [00:05:30] and more reliable.
Speaker 2: I do feel that what we were used to as what we call normal prior to COVID will never come back. There will be something of a new normal. I do believe that there will be a permanent transf of spending from entertainment, eating out travel, uh, to buying products
Speaker 1: Though online spending is now beginning to slow slightly. The supply chain itself could change. Companies could shorten shipping distances by making things either in the us or in neighboring countries. The Biden administration would [00:06:00] like that to happen for critical products like information and communications, technology, national defense, healthcare and medicine in July Biden also appointed a special Envoy on port congestion.
Speaker 3: These are the things that we must have. We must have national defense. We must have a secure public health system and looking to identify very specific gaps in figuring out the best way to go about creating resilient supply chains. And so that [00:06:30] resilient supply chains have built in redundancies. This is not about bringing every far flung supply chain back to the United States,
Speaker 1: But whatever happens as you continue to fill your virtual shopping cart with more things, remember they don't appear on your doorstep magically. It takes thousands of miles, thousands of people and everything from trains, planes, and trucks, to get them to you.
Speaker 2: There are many people along the way who have been [00:07:00] responsible from the factories who have made it to the Kumen on the ships, uh, bringing the product here to the bar pilots who guide the vessels in to the longshoremen and the management at the terminals. There are many, many people who, who, uh, proudly work to get the product all the way to your home.