The Port of New York-New Jersey: Rail Demand, Empty Containers, and a Possible Container Fee in September
The Port of New York-New Jersey has had their fair share of challenges as of late; rail demand, empty containers lingering, and a possible container fee being implemented in September are just some of the current topics of discussion.
Rail demand in and out of the Port of NY-NJ has hit a bit of a snag. For the past six months there has been a drop in rail volumes, mainly coming from a 24 percent drop in intermodal during January, but March and April also showed year-on-year declines, the Journal of Commerce reported.
Additionally, in the first half of 2022, rail lifts at the port of NY-NJ were seen going in a different direction than container volumes; on-dock rail facilities at the port handled 353,429 container lifts – which was a 3.8 percent decline from the first half in 2021, data from the port showed.
Back in June, one major Class I railroad, Norfolk Southern, started to limit container lifts at five origins, including NY-NJ because of the congestion at the destination ramps. These and other service issues in the rail industry have been factors in rail demand decreasing and also why some shippers are choosing truck vs rail.
Empty containers sitting at ports continues to be a challenge throughout this year.
As of August 4th, throughout the NY-NJ port, there has been around 210,000 empty containers – which is up 68 percent through the first seven months of 2022, the JOC reports.
You might remember back in July how the port expanded their operations into the evening on weekdays as well as the weekend. But even with those extended hours 4% of cargo was moved on Saturdays each week. The Port Director Beth Rooney stated that “it’s crickets. We can’t continue to handle 30% increase in cargo in the same hours of operation.”
Furthermore, Federal Maritime Commission (FMC) Chairman Daniel Maffei said the FMC will ask ocean carriers that have excessive empty container inventories at the port what their plans are for managing them. Maffei also noted that ocean carriers should compensate motor carriers for the costs of yard space and chassis that empties handling requires.
Possible Container Fee?
At the beginning of August, the Port of NY-NJ will implement a container fee – pending a mandatory 30-day federal notice – for any long-dwelling import or export containers. This fee would begin in September as the port wants to get ahead of holiday items that are anticipated to arrive throughout peak season. The port also made note that the fee will be reassessed once the container crisis eases, FreightWaves says.
The port has a 12-acre lot to help keep up with the increase in empty containers and long-dwelling import containers.
Port Director Bethann Rooney emphasized the importance of the empty containers that are piling up in and around the port that are impacting the supply chain.
“We emphatically encourage ocean carriers to step up their efforts to evacuate empty containers quicker and at higher volumes to free up much-needed capacity for arriving imports in order to keep commerce moving through the port and the region,” she stated.
Additionally, ocean carriers’ total outgoing container volume must equal or exceed 110 percent of their incoming container volume during the same period. If this is not achieved, the ocean carriers will be charged $100 per container of imbalance – rail volume is not included, FreightWaves notes.
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