9 March 2005

Ports delay free-time cuts

The following article is excerpted from the 9 March 2005 edition of “The Journal of Commerce”.

California ports … have decided to delay a plan to reduce free time shippers are permitted to store containers at ports.

The busy ports are looking for ways to avoid a repeat of last year's congestion in Los Angeles-Long Beach. One proposed measure is to reduce the amount of time that a container can be kept on the docks for free before a storage fee… is charged.

Cargo dwell time is considered a major contributor to port congestion….

Port executives meeting this week decided to gather more information before implementing and changes in free storage time.

At present, imported containers are allowed five days of free time and exports seven.

The ports, working together with immunity from federal anti-trust laws under the California Association of Port Authorities, are considering a proposal to reduce free time by one day on imports and exports.

Also, the ports are mulling another proposal to begin counting free time the day after each container is removed from a vessel. At present, free time calculation begins after the entire ship is unloaded….

Some transportation groups questioned the proposed reduction in free time. The Los Angeles Customs Brokers & Freight Forwarders Association noted that due to congestion at the ports truckers are sometimes not able to pick up a container until after free time expires. Terminal operators nevertheless still charge demurrage even though the congestion was due to business practices of the carriers or terminals.

Also, cargo receivers and truckers could be victimized by the proposal to calculate free time on a container-specific basis unless there is a system in place to verify exactly when individual containers are unloaded from the vessels, the brokers stated.

Cargo interests generally are looking for assurances from terminal operators that if free time is reduced, the terminals will be able to expedite the movement of containers through their facilities.

Don Snyder, marketing manager at the Port of Long Beach, said the ports are also considering a proposal that would link a reduction in free time with the PierPass program, scheduled to begin in June, under which all terminal operators in Los Angeles-Long Beach will extend gate hours to nights and weekends. The terminals will most likely run four night gates and one Saturday day gate each week. That would give cargo owners more time to retrieve their containers before free time expires….