Statement by Commissioner Bentzel on East Coast Empty Container Congestion
I want to agree and associate myself with the statement made by Chairman Maffei in the aftermath of his visit to the Port Authority of New York/New Jersey, and his concerns on the mounting challenge of returning empty containers to the marine terminals servicing the port. In my view, the congestion emanates from the lack of accountability in moving the buildup of empty containers back into the terminals. Empty containers, and perhaps even export containers, are being rejected for return or delivery, because of the surging levels of imports that need to be handled. The industry needs to come together to plan how to better respond to the current challenges of returning empties to the Port.
Unfortunately, this is not a new issue. A year ago, while touring the Port of NY/NJ with Chairman Maffei, the same issues were presented, and I followed up with letters strongly encouraging each of the ocean shipping alliances participating on the Council on Port Performance (CPP) to work to help coordinate policies with their marine terminal partners in order to better coordinate delivery of their equipment. The CPP was established by the Port to facilitate just this sort of response.
Clearly this has not happened, and the situation has gotten much worse. I understand that the problem is spreading to other east coast ports such as Baltimore, which reported to me last week that they too have an overflow of empty containers, hindering terminal operations and port fluidity. In the face of continuing surges of import cargo to the east coast, how the carriers and marine terminals manage their equipment must change.
In my view, it is fundamentally unfair to require small and large trucking companies to pay storage costs to store ocean carrier owned containers. I would point out that we are still receiving allegations that, in addition to storage costs that, perhaps some carriers may also still be assessing detention charges, even though it is impossible to return containers – a double whammy.
Now, a year later after my last visit to the Port of NY/NJ, Congress and the Administration has acted and provided new regulatory tools in the Ocean Shipping Reform Act of 2022 (OSRA) to respond to emergency situations affecting the reliability of international ocean transportation supply system. In my view, Section 18 of OSRA establishes a comment process to solicit public comment on just this sort of emergency. If after reviewing comments, the Commission unanimously agrees, then the FMC is authorized to order information sharing requirements on industry behavior. I believe that on certain east coast ports that we need public comment to assess how carriers and their marine terminal operators manage their containers to determine whether it is now reaching an emergency level that could impact our supply chain and our economy.
In the meantime, I continue to urge the carriers, marine terminals, shippers, and trucking interests to work with the relevant port authorities to develop better planning for the return of empty containers, and ultimate redeployment of badly needed transportation assets.
Carl W. Bentzel is a Commissioner with the U.S. Federal Maritime Commission. The thoughts and comments expressed here are his own and do not necessarily represent the position of the Commission.