California’s ports may face new political pressures during “Peak Season”

"Pulse of the Port" event in Long Beach will address a great many issues of concern

By ·

The Port of Long Beach will stage its 13th annual “Pulse of the Ports: Peak Season Forecast” next week, featuring a panel discussion with industry experts who will provide their thoughts and expectations for the upcoming peak season and the impact of new container alliances beginning in April…”among other issues.”

Pacific Rim shippers will no doubt hope that this panel will also share insights on the proposed billion dollar container fee now being proposed for California’s three largest ocean cargo gateways.

In its monthly “West Coast Trade Report,” the Pacific Maritime Shipping Association (PMSA) alerts shippers to the Fact that the South Coast Air Quality Management District (SCAQMD) has proposed not one – but two – different container fees to be assessed on containerized imports and exports moving through Long Beach, Los Angeles, and Oakland.

The fee proposals range from a low of $35 per twenty-foot equivalent unit (TEU) (which would reportedly raise $385 million per year) to upwards of $100 per TEU (which would raise $1.1 billion per year). Which proposal the SCAQMD decides to finally pursue is uncertain at this point, states the PMSA.

According to PMSA president, John McLaurin, the air district first pitched the $35 per TEU proposal with state legislators in late February. As part of that effort, the SCAQMD noted that the $385 million that would be collected every year would be used to “...help fund near-zero and zero emission cargo handling and drayage equipment.” The bill proposal was silent as to whether it applied to the Port of Oakland.

“Interestingly,” notes McLaurin, “while their Sacramento efforts were underway to introduce a bill implementing the $35 per TEU 
fee, the SCAQMD Legislative Committee held a ‘Special Meeting’ where the Legislative Committee adopted a staff recommendation to consider a $100 per TEU con- tainer fee. The fee would be imposed at the Ports of Los Angeles, Long Beach and Oakland.”

The PMSA notes further that while the Legislative Committee does not include any information on what the $1.1 billion would be spent on, it did discuss “...the low pass-through costs on shippers from the proposed fee...” and that the funds collected would go to the “...respective air districts containing the specified ports.”

Exactly how attractive ocean cargo container alliances will find California ports this year has yet to be determined, but with shippers concerned about rate hikes and with carriers now engaged in extreme collective cost-cutting, the “pulse” of ports here may weaken. 


About the Author

Patrick Burnson, Executive Editor
Patrick Burnson is executive editor for Logistics Management and Supply Chain Management Review magazines and web sites. Patrick is a widely-published writer and editor who has spent most of his career covering international trade, global logistics, and supply chain management. He lives and works in San Francisco, providing readers with a Pacific Rim perspective on industry trends and forecasts. You can reach him directly at [email protected]

Subscribe to Modern Materials Handling Magazine!

Subscribe today. It's FREE!
Find out what the world’s most innovative companies are doing to improve productivity in their plants and distribution centers.
Start your FREE subscription today!

Article Topics

· All Topics
Latest Whitepaper
Sorting Out Your Sortation Options
Guiding you through the process of evaluating and selecting the right “mission-critical” sortation solution
Download Today!
From the April 2017 Issue
How does a fastgrowing, e-commerce startup company build out order fulfillment capabilities? Thrive Market answered that question with its new facility in Indiana.
2017 Warehouse/DC Equipment Survey: Investment up as service pressures rise
Putaway 101: Everything in its Place
View More From this Issue
Subscribe to Our Email Newsletter
Sign up today to receive our FREE, weekly email newsletter!
Latest Webcast
2016 Warehouse/DC Operations Webcast: Confronting omni-channel complexity
During this webcast we’ll examine the current activities, trends, and best practices in warehouse and DC operations management and how companies plan to address complex issues associate with omni-channel fulfillment.
Register Today!
EDITORS' PICKS
ProMat closes: Make your plans for Modex 2018
With a record number of exhibitors and attendees seen at ProMat 2017, MHI anticipates more of the...
Keynote: Magic is the result of over-preparation and over-delivering to customers
During his keynote presentation Wednesday afternoon, Earvin “Magic” Johnson told a packed...

Keynote panel confirms digital supply chain shift seen in new MHI study
Wednesday’s keynote panelists agreed it is time to embrace the shift to digital supply chains seen...
MHI to honor original products, solutions with 5th-annual Innovation Awards
On Wednesday, during MHI Industry Night with Dana Carvey, the winners of the 5th-annual MHI...