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Key U.S. West Coast ports stay open 24/7 to unsnarl supply chain

Biden teams with FedEx, Walmart and Samsung to ease import backlog

Cargo container vessels are backlogged at the Port of Long Beach in California.    © AP

WASHINGTON/NEW YORK -- The U.S. will keep major West Coast ports open around the clock to handle a long-running backlog of imports from China and elsewhere in Asia that is preventing many goods from reaching American store shelves, President Joe Biden said Wednesday.

"Today we have some good news," he said. "We're going to help speed up the delivery of goods all across America."

Biden also announced commitments from major companies and freight movers including Walmart, UPS and FedEx -- which he said account for up to 40% of the packages in the U.S. -- to increase the amount of goods moved at night and during off-peak hours. The news came after a virtual roundtable with California authorities, labor unions, retail giants and logistics companies.

The expanded capacity is meant to address growing concerns about shortages contributing to the persistent inflation of recent months. The trend has dampened consumer confidence in an economy still recovering from the coronavirus pandemic and weighed on the Biden administration's poll numbers.

The Port of Los Angeles will operate at full capacity even on nights and weekends, while the Port of Long Beach already is introducing a 24/7 schedule. These two California facilities combined account for about 40% of containers entering the U.S.

The International Longshore and Warehouse Union has said members are willing to work the extra shifts.

"Today's announcement has the potential to be a game changer -- I say 'potential' because all of these goods won't move by themselves," Biden said, stressing the role that major private sector companies have in moving goods.   

Companies will work to shorten the time that cargo sits at these ports. FedEx looks to double nighttime container volume through steps such as changes in rail use. Walmart plans to ramp up night operations to increase throughput by as much as 50%, while South Korea's Samsung has committed to move 60% more containers by operating 24/7 over the next three months.

The White House said it expects these measures to move an additional 3,500 containers per week at night.

For these near-term measures, "we'll be the honest brokers and partners," a senior administration official told reporters Tuesday.

Such commitments are "most effective when every private company along the supply chain does the same thing," the official said.

Biden also plans separate measures to alleviate the global chip shortage.

The impact of the pandemic continues to reverberate through supply chains in the U.S. and beyond. The two California ports were severely short-handed early this year amid coronavirus outbreaks. On the export side, port closures in China and Vietnam -- major producers of home electronics, toys, furniture and apparel -- have added to the delays.

These problems came just as a shift in consumer demand from services to goods increased freight demand. Imports into major U.S. ports grew by an estimated 6.7% on the year in September, according to the National Retail Federation. About 75 container ships await berths at Long Beach and Los Angeles, triple the number a month ago.

Goods imports into the U.S. for the first eight months of 2021 jumped 23% to $1.85 trillion, American trade data shows. Shipments from top supplier China rose 21% even amid the tariffs imposed by previous President Donald Trump's administration on Chinese goods.

The measures planned by the White House and its partners will not be enough to resolve the supply chain constraints. Shipping and retail companies still face serious labor shortages. And China's recent energy crunch risks further slowing production and transportation of goods there.

Biden also used the announcement to underscore the importance of passing his infrastructure bill and his broader "Build Back Better" agenda.

"We need to take a longer view, though, that invests in building greater resilience to withstand the kinds of shocks we've seen over and over, year in and year out, whether it's the pandemic, extreme weather, climate change, cyberattacks or other disruptions," he said.

The administration is responding to mounting public frustration. Only 29% of respondents in a Quinnipiac University poll released last week said the economy is good or excellent, down from 38% in May. Inflation and shortages continuing into the year-end shopping season would invite political attacks from opposition Republicans.

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