California Apparel News

What a difference a year makes.

This time last July, an early rush to import Back-to-School clothing from Asia started a six-month-long traffic jam at the Port of Los Angeles and Port of Long Beach. Dozens of ships lined up beyond the breakwater waiting to dock.

So far this July, it is smooth sailing at the ports of Long Beach and Los Angeles, even though container shipments are up.

“We’ve come through with flying colors,” said Manny Aschemeyer, executive director of the Southern California Marine Exchange, which tracks the comings and goings of vessels at the two ports. “We are averaging 35 to 50 ships a day, and they are all going straight to dock.”

Not so last year. A crush of containers started pouring into the ports around Father’s Day and never stopped until November. At one time, there were 35 to 40 ships anchored off the breakwater while another 60 were docked and being unloaded.

“It was greatly underestimated last year the time and volume of shipments,”Aschemeyer recalled. “Normally, the peak season started in late August and early September, but this time it was late June and early July. And [the ports] were looking at an increase of 5 to 6 percent in volume, and it turned out it was 14 percent.”

Consequently, there were not enough longshore workers to handle the influx of containers stacking up on the docks. That meant some ships were taking as long as eight to 10 days to unload.

Add to that a major shortage of railroad personnel, many of whom took early retirement. Frustrated truck drivers, waiting hours to pick up only one or two loads during a shift, looked for other loads to haul.

Divvying up business

But this year, several factors have improved conditions at the country’s largest port complex, which handles 40 percent of the ocean cargo coming into the United States.

First, many importers and exporters decided to not use Southern California’s ports this year, diverting their cargo to other ports.

Michael White, co-owner of Sundog International, an activewear and sportswear company based in Anaheim, Calif., said that he shifted his shipping business to the Port of Oakland last year.

“Our outgoing freight to Hawaii we now truck to Oakland,” said the apparel company executive, who distributes American Apparel–made clothing to Hawaii and California and ships the company’s own label to the island state. “We started doing that about nine months ago. Even though the port here has improved, Oakland is still working for us. It doesn’t cost any more money, and Oakland is definitely more reliable.”

Big-box stores are taking the same approach. Wal-Mart Stores Inc. is putting the finishing touches on a gigantic new distribution center near Baytown, Texas. The 2 million-square-foot warehouse covering 50 acres enables the mega-retailer to ship goods through the Port of Houston, instead of Los Angeles, and distribute them to stores in the Midwest and the South. While Wal-Mart executives didn’t want to talk about their distribution strategy, Christi Gallagher, a Wal-Mart spokesperson, wrote in an e-mail that “the new Houston facility will help [the company] to diversify, to have locations on the East Coast, the West Coast and in the Gulf.”

Second, major ports up and down the West Coast have decided to capitalize on last year’s Southern California port congestion problem. Recently, the Port of Seattle sent out a notice reminding shippers that it does not have a PierPass program that charges importers and exporters an additional $80 per 40-foot container fee to handle cargo during the day.

PierPass, a program that starts on July 23, will keep terminal gates open during evening hours and Saturdays at the ports of Long Beach and Los Angeles to alleviate congestion. Anyone picking up cargo during the day will be charged a fee, while those who collect containers between 6 p.m. and 3 a.m. will not be charged.

The Port of Seattle’s cargo numbers were up 27 percent during the first five months of this year, compared with last year.

“We have been growing pretty dramatically,” said Mick Shultz, a port spokesperson. “This growth is not just diversions, but we think it is long-term growth. One reason is that some of the major importers—such as Wal-Mart, Home Depot, Pier 1 Imports and Target—have established national import distribution centers here in the last four or five years. It is due in part to the fact that we have ample rail capacity between here and Chicago.”

Oakland, which added two marine terminals in the last five years, is also hoping to serve as a viable alternative to Los Angeles.

“We are trying to serve as a solution for the port congestion,” said Marilyn Sandifur, a Port of Oakland spokesperson. She said the port’s container traffic was up 25.7 percent during the first five months of this year, compared with last year.

In March, the Port of Oakland received two giant super cranes to help unload the new mega-ships that carry up to 8,500 containers. A standard cargo ship transports roughly 4,700 containers.

And in June, MOL America Inc. inaugurated a new route that travels from Hong Kong and South China, stops first in Oakland and then continues on to Los Angeles. It replaces a route that stopped first in Los Angeles.

Picking up the pace

With other ports whittling away at their business, port executives in Long Beach and Los Angeles are working on ways to make their docks more efficient.

In an attempt to free up space, inbound cargo containers can only sit on the docks now for four days instead of five without being charged a fee.

In addition, the International Longshore and Warehouse Union has now trained 10,000 casual workers to help the 7,000 full-time longshore workers who unload freight at the ports, said ILWU spokesperson Steve Stallone.

That will be a big help for the Port of Long Beach, where cargo traffic is up 28.7 percent, compared with last year. Traffic at the Port of Los Angeles, however, is down 1.5 percent this fiscal year, which began Sept. 1.

The casual workers will see more opportunities to work when the ports open their gates July 23 to evening and Saturday business to push cargo through more quickly.

“We are taking as many steps as we can so the terminals can be as productive as possible,” said Port of Long Beach spokesperson Art Wong. “So far, we haven’t had any problems.”