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The White House port and supply chain envoy, retired Gen. Stephen Lyons, met with Port of Oakland officials Aug. 29 at the California complex, discussing the ongoing supply chain issues, as that facility has seen a significant drop in container traffic this year.
That is due in part to shippers having passed it by because of higher shipping rates available at the ports of Los Angeles and Long Beach.
In July, the Port of Oakland recorded a 28% year-over-year decline in cargo, one reason being it was shut down for a week by independent truck drivers, who were protesting the implementation of California’s new worker classification law. Also, shippers say from a cost benefit it makes more sense to avoid going to Oakland, ship the items destined for Oakland by truck and then head back to China or another Asian port, reload and cross the Pacific again full.
Lyons met with Port of Oakland Executive Director Danny Wan and Maritime Director Bryan Brandes to discuss the challenges Oakland’s maritime activities face and continue the federal dialogue to support solutions to goods movement.
“I am committed to looking for ways to stabilize the entire supply chain across the nation and restore consumer confidence in the system, and the Port of Oakland plays an important role in our nation’s freight network,” Lyons said.
Oakland’s drop in cargo is taking place at a time when other ports are seeing record container volumes.
While overseas shipping prices have fallen significantly from their pandemic high of more than $16,000 per 20-foot-equivalent unit, the latest Drewry’s composite World Container Index for spot rates decreased by 2% the last week of August. It marks the index’s 23rd consecutive weekly decrease, and shipping prices now are 29% below year-ago levels. Rates for the Shanghai-to-Los Angeles route fell 3% to $7,280 per 40-foot container. However, the Drewry WCI composite index for spot rates remains 84% higher than the five-year average.
Port of Oakland’s Wan said he believes Lyons’ visit to Oakland is a sign his facility is open for business and set to make a rebound.
“We fully appreciate Gen. Lyons coming to Oakland to see our operations and explore solutions to the current supply chain congestion,” Wan said in a statement. “Oakland has been a decadeslong port of choice for agricultural exports; we need to restore a full complement of services here to help all of our customers move their goods.”
As part of his visit, Lyons met with agricultural exporters, importers and maritime terminal operators who rely on the port for their business.
According to port officials, the agriculture leaders expressed concern about how their import and export operations are being disrupted at various points in the supply chain.