Despite the challenges 2021 brought, it was still a year of significant growth at the Port of LA. In fact, it was a record year at the Port of LA and Long Beach that included an overall 13% increase in processed Twenty-Foot Equivalent Units (TEUs) – around 10.7 million in total.
2021 also saw movement toward significant investment into portside infrastructure and sustainability, including $17 billion for National Infrastructure Investment and Jobs Act and $2.3 billion earmarked by Newsom in the California state budget for the upcoming year.
Once a year Gene Seroka, Executive Director of the Port of LA, shares his State of the Port presentation. This insightful report offers freight forwarders and other logistics pros a look under the hood of the nation’s largest port. Here are some of the highlights from this year’s review:
Supply Chain Efficiency
The network of American ports is in higher demand than ever before. More goods are traveling into the U.S. from overseas every day, and everyone on the supply chain from drayage to intermodal to trucking needs to operate at maximum efficiency to prevent bottlenecks.
That’s why digitizing the supply chain is a top priority at the Port of LA and Long Beach in 2022. Last year, port administrators made moves towards advanced data control and automation by expanding the Port Optimizer system with the Control Tower suite of data tools. This system aids cargo owners and service providers by providing precise shipping intelligence and real-time insights at the port. That allows stakeholders to schedule transportation, plan for contingencies, and keep supply chain partners and customers informed like never before.
In 2022, port officials will add further enhancements to port data management systems, and work with the Biden Administration to support broad-based data initiatives.
Workforce Development & Job Creation
Short staffing has presented a challenge for heavy industry and transportation since the beginning of the COVID-19 crisis. Thousands of workers have left the labor pool due to illness, early retirement, or new opportunities in other industries. Companies are learning how to recruit talent in a tight market and make do with fewer workers thanks to automation and new technology. The port is no different.
To address the rapidly changing needs of the industry, the Port has planned a Goods Movement Training Campus to focus on up-skilling, skill development, and re-skilling workers. This program will receive up to $110 million from California Governor Newsom in the proposed budget. It will be the first educational initiative in the US that is specifically dedicated to the goods movement industry, and will also serve as a resource for training workers on greener and zero-emission tech.
Cyberattacks on major infrastructure hubs are among the biggest threats to the supply chain. These attacks are costly – to the tune of tens of millions of dollars paid in ransoms and repairs – and disruptive in a way that can seriously impact global trade. And, they can originate from something as simple as a phishing email.
In 2021, Port officials launched a first-of-its-kind port cyber defense system (co-developed with IBM) to guard against potential malicious cyber incidents that would threaten or disrupt cargo. Now in full operation, the Cyber Resilience Center is an early warning system and info sharing network for Port stakeholders. This rapid response network helps to detect and mitigate data breaches and penetration attacks before they turn into costly and damaging catastrophes.
Greening the supply chain will be one of the biggest challenges of the 21st century. Removing carbon emissions from drayage, cargo handling, harbor craft, and ocean-going vessels will require planning, investment, and ongoing partnerships with government and private industry. Fortunately, the Port of LA and Long Beach has got a jump start on things.
The port has already made significant progress on meeting carbon reduction targets set by the Governor. Officials are currently testing 107 zero-emission and 27 near-zero-emissions units in drayage and transport that will serve as the vanguard of new technologies in the years to come. This number is expected to continue to grow to more than 200 over the next 18 months
Furthermore, new California clean trucking regulations such as the Clean Truck Fund Rate will impact the movement of goods to and from the port and is going into effect in April 2022. This approved CTF Rate of $10 per TEU will be charged to non-exempt trucks and will be used to generate funds for decarbonization efforts. Port officials expect the CTF rate to generate $90 million in its first year or $45 million per port.
Even though 2021 continued to be fraught with challenges for companies on the supply chain, the Port of Los Angeles and Long Beach had a record year. Growth outpaced scaling of technology and physical capacity at times, but port officials have continued to improve systems and adapt as much as possible. A host of new technologies and opportunities for partnerships are available to freight forwarders and other supply chain companies to streamline operations even further.
For example, a 3PL provider at the port like Globecon can provide advanced logistics management, warehousing, and intermodal capabilities to outside partners to work around transportation backups and ensure your cargo gets where it needs to go.
Want to build out supply chain operations at the Port of LA and Long Beach? Partner with Globecon!