Empty containers will overwhelm ports in 2023, warns Sea-Intelligence

Sea-Intelligence predicts there will be 4.5 million surplus containers in early 2023

Posted on September 8, 2022 at 6:48 p.m. by

The Maritime Executive

Ports around the world have been complaining about the accumulation of empty containers for nearly a year, blaming the containers piling up in their yards of contributing to backlogs and disrupting supply chains. Ports and regulators have recently considered new measures to eliminate the backlog of empties, but according to new analysis by Denmark-based data analytics firm Sea-Intelligence, a return to normal in shipping could flood ports with even more empty containers by early next year.


The Port of Los Angeles and Long Beach have been threatening for nearly a year to institute fees based on excessive dwell times to encourage carriers to empty containers and this despite complaints from shippers who claimed in 2022 that carriers ships were rushing to Asia with empties to the detriment of US exporters. All ports have already added storage capacity while Oakland, California, for example, has reduced free time in the yard, and on the East Coast, the Port of New York and New Jersey plans to start in the fourth quarter to charge carriers an imbalance fee if they do not pick up more containers than they deliver.


“If transport times return to normal early next year, we will see the release of 4.3 million TEUs of excess containers in North America, which cannot be expatriated, as part of the operations. planned network,” warns Alan Murphy, CEO of Sea-Intelligence. . “This will potentially overwhelm empty container depots in the United States, a problem that is already beginning to materialize.”




Sea-Intelligence forecast for the accumulation of excess containers



During the surge in shipping volumes, they point out that containers have been caught up in longer supply chains. With a massive shortage of empty containers, carriers were begging for containers and had to order new containers to be manufactured in Asia. These have been introduced into extended supply chains.


In its analysis of the possible standardization of supply chains and the potential ramifications on empty container flows, Sea-Intelligence highlights the decrease in the time between the moment the cargo is ready at the exporter and the delivery by the importer. Before the pandemic, transport time averaged 45 days, peaking at a transport time of 112 days in February 2022, which has since been reduced to 88 days, by the end of August, they report.


“As transit time gets shorter, these extra containers will be taken out of the supply chain and they will start to pile up, primarily in Europe and the United States,” predicts Murphy.


Sea-Intelligence had identified this problem in February this year, but at the time they expected a slower return to the supply chain and less excess. They had predicted that 3.5 million TEUs could become surplus in 2023 on transpacific routes. With reports of slowing shipping levels, Sea-Intelligence is increasing its forecast and indicating a faster acceleration of excess containers.


This is already confirmed in ports such as New York and New Jersey which began their efforts this summer to impose the new fee. They recently reported that carriers are working with them on the container backlog, but based on Sea-Intelligence’s analysis, more containers will be put back into the system, which will further exacerbate the challenges, especially for North American ports.

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