Top U.S. West Coast gateways see continued uptick in throughput

San Pedro Bay ports aerial
Photo Credit: Port of Los Angeles

December 19, 2023–Southern California’s San Pedro Bay Ports of Los Angeles and Long Beach are experiencing a long-awaited rise in container throughput as their November numbers show substantial increases over the same month in 2022.

“In November 2023, the volume share at top West Coast ports increased based upon the significant volume decrease at top East and Gulf Coast ports,” said analyst Descartes Datamyne.

The Descartes analysis showed that the top five West Coast ports’ market share increased by 3.5% to 43.1% month over month from October to November, while the top five East and Gulf Coast ports decreased by 3.1% to 42.0% of the market.

Port of Long Beach (POLB) CEO Mario Cordero had no hesitation in affirming a changed direction of trade, saying “we are recapturing market share, online shopping is on the rise and retailers are keeping the shelves stocked to meet rising consumer demand for the holidays.”

“We remain optimistic as cargo returns to this critical gateway for trans-Pacific trade,” Cordero said.

Port of Los Angeles (POLA) Executive Director Gene Seroka voiced a similar opinion: “Thanks to the outstanding efforts of our dockworkers and other stakeholders, we’ve gained market share in recent months.”

Seroka added that the port will “continue those efforts into 2024 as we work toward maximizing our operational efficiencies and decarbonizing our port complex.”

For the two ports combined, November 2023 loaded imports landed at 719,958 twenty-foot equivalent units (TEUs), an increase of 27.10% compared to the previous year. 

Loaded exports came in at 220,553 TEUs, an increase of 2.53% compared to 2022. Empty containers in and out totaled 533,512 TEUs, a 19.50% increase compared to last year. 

While the two ports’ November numbers are up year over year, the year-to-date numbers still show a 14.49% drop over the same 11 months in 2022, falling from a total of 17,771,840 TEUs last year to 15,196,010 so far this calendar year.

The disparity in the two sets of numbers—year over year and year to date—can be attributed to the decline in cargo volumes along the West Coast starting in July 2022 and running through August 2023.

At the time, shippers were concerned about potential stoppages in throughput due to labor negotiations between the International Longshore & Warehouse Union (ILWU), which represents dockworkers, and the Pacific Maritime Association (PMA), which speaks for their employers.

Now, following the August 2023 ratification of a new ILWU-PMA labor contract, the rise in numbers for the two West Coast ports is generally attributed to a decision by reassured shippers to return their diverted cargo flows back to the Pacific Coast gateways.

The November numbers represent the fourth consecutive increase in volume for POLA, while POLB’s numbers show the third month in a row of increased throughput. In both cases, the improved numbers represent a return to greater market share.

POLA’s Seroka sees the West Coast uptick as good for the country as a whole, telling Bloomberg Television, “All the vital statistics in Los Angeles? Just use that as a barometer of the nation’s supply chain.”

The return of cargo from the East to the West could be further accelerated by contract negotiations in 2024 between the International Longshoremen’s Association (ILA), which represents dockworkers at East and Gulf Coast ports, and their employers’ negotiator, the United States Maritime Alliance (USMA).

It could be a rocky time for shippers, carriers and customers especially since ILA President Harold Daggett is on record saying his membership expects to be rewarded for the work they have done, especially during the pandemic period.

“It was hell, and it was war, and our ILA workforce were truly America’s front-line heroes. I salute each of you and all the longshore workers we represent back in our home ports,” Daggett told union delegates at a conference in July 2023.

Reports suggest the ILA is looking for at least parity with the ILWU, which saw an increase of more than 30% in its negotiations, along with a generous bonus for work done during the pandemic.

Seroka acknowledged that it has been a “summer of discontent” across America, with a lot of final negotiations and contracting in the favor of labor and the employee.

“I don’t see that any different on the East Coast,” he told Bloomberg, referring to the upcoming ILA-USMA talks. “It’s folks that worked through the pandemic day and night, fearless of health and safety issues, trying to keep the American economy moving—and their payday is due.”

As the ILA and USMA haggle over that payday in the coming year, even more cargo could be coming to the U.S. by way of the Pacific Coast ports—diverted by concerned shippers.