Port truckers still struggling in harsh market

"The reality is my members are still not in a great position. We still see ourselves in what is called a freight recession,” Loya said. (Eric Thayer/Bloomberg)

The trucking companies serving the nation’s largest seaports are still struggling against harsh market conditions even as port volumes continued to increase in May.

Descartes Systems Group noted in its monthly global shipping report that container import volume increased 11.5% from the prior year to 2,428,758 20-foot-equivalent units in May. It also rebounded 6.6% sequentially, but the report still expressed unease over continued geopolitical risks, from the Strait of Hormuz to increasing trade tensions.

“You’re seeing this increase in volume of imports,” Harbor Trucking Association CEO Robert Loya said. “The devil is in the details. The imports are up, yes, but what the ports don’t report is what goes on dock, which is on-dock rail, versus what goes out the gate.”

Port of Los Angeles container volume rose 17% to 840,165 units from 716,618 a year earlier amid continued uncertainty surrounding trade policy and global supply chains. Port of Long Beach volume climbed 31.7% to 842,030 from 639,160, with port officials viewing the results as demonstrating resilience against tariffs and geopolitical uncertainty.

“Both ports report that their import volume is up, which is great, and you would think it translates to more trucks,” Loya said. “But the reality is my members are still not in a great position. We still see ourselves in what is called a freight recession.”

Loya attributed much of the rise to shippers frontloading cargo ahead of a potential increase in tariff costs when certain rates expire July 24. But he also noted that the market is not affecting all of his members the same way, with some doing well while others have continued to struggle since the tail end of the coronavirus pandemic.

“The reality of the situation is that in L.A.-Long Beach, we’re still struggling due to the fact that there were so many carriers that were infused during COVID,” Loya said. “It’s a race to the bottom, and rates are still an issue, fuel is still an issue, for my members.”

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(Eric Thayer/Bloomberg)

Loya added that recent fuel cost declines have not been enough since many brokers that serve the ports have been requesting all-in rates. He also pointed out that these carriers often have much of their business tied to the ports, so it can be difficult to just walk away when volumes aren’t sufficient. Loya has seen these problems increase the farther up the West Coast he goes.

“We’ve all had to learn to adapt to reduce our costs and our overhead because of the uncertainty,” Loya said. “Everybody is being creative, using AI, using algorithms, outsourcing out of the state to reduce cost, back-office stuff.”

Loya noted that the larger carriers have had more of an ability to invest and adapt, although he has still seen some of his small and midsize members find ways to manage their business well. But he has also seen others try to compete but be forced to accept lower rates. IMC Logistics likewise has been experiencing congestion issues at ports.

“Newark Terminals continue to have throughput issues,” IMC CEO Joel Henry said. “[Global container terminals] is currently averaging 2.5 hours per gate move, while all other terminals are 1-1.5 hours per gate move. This has been an ongoing issue for more than a year; chassis availability is stressed.”

IMC has also been tracking an increase in throughput issues at New Orleans and Mobile, Ala., terminals over the past 45 days, with the main challenges centering on congestion and a lack of appointment slots. The Oakland International Container Terminal also continues to struggle with throughput, but Henry doesn’t believe it is a congestion issue since volume is flat.

“LA/LBC throughput has been steady with per gate moves constant throughout the year so far,” Henry said. “We are experiencing more delays getting appointments at most terminals, increasing to 1.5-plus days upon discharge, an increase from one day to get an appointment approximately 30 days ago. Chassis available is tighter than previous months.”

IMC ranks No. 50 on the Transport Topics Top 100 list of the largest for-hire carriers in North America and No. 6 on the intermodal/drayage list.

Separately, Bali Express Services was recognized by Long Beach leadership for its efforts to establish a green truck corridor between the port and Mexico. The move reflects ongoing efforts by the port to be more environmentally friendly as well as increased trade from Mexico.

Other major seaports reported mixed results for the month.

• The Northwest Seaport Alliance reported that container volume decreased 5.1% to 238,021 from 250,851.
• The South Carolina Ports Authority reported that container volume decreased 2.2% to 214,478 containers from 219,255.
• Port Houston reported that container volume increased 4% to 398,322 containers from 381,640.
• Port of Oakland reported that container volume increased 1.9% to 190,958 from 187,389.

The Port Authority of New York and New Jersey did not have its monthly volume numbers available at press time.