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US ports mull calls to extend gate openings, but also weigh steep cost

THE US port of Oakland's is seeking government support for its plan to open its terminal gates an extra day each week over the weekend to more adequately handle today's cargo volumes, albeit at an additional cost for shippers.

Extended gate opening hours is a trend seen at the ports of Oakland, Los Angeles and Long Beach on the west coast, and at Charleston and Savannah on the east coast, reported Newark's Journal of Commerce.

In the past to work vessels at night or on the weekends the terminals would charge carriers a lift fee to move load and discharge containers. In the largest ports, such as Los Angeles and Long Beach, if turning a big ship requires working five shifts over two and one-half days, the terminal works at night and the shipping line pays for the services.

In contrast to vessel operations, terminals make no money processing trucks into and out of their gates. It is purely a cost centre. However, gate turn times is where the ultimate customer, the importer or exporter, is most directly affected in the port segment of the supply chain.

It is no secret that truck turn times at many ports have deteriorated to the point of embarrassment for the port authorities. "When turn times are more than an hour, to an hour and a half or longer, we have a problem," said Oakland port executive director Chris Lytle.

Long delays are financially disastrous for truckers, most of whom are paid by the trip. Truckers are not compensated for the time they spend waiting in line.

According to the CEO of the South Carolina Ports Authority, Jim Newsome, truckers who can't make a living in harbour drayage will find jobs in other industries, and the rapidly-growing port will have a truck capacity shortage to deal with.

"As an operating port, we told the shipping lines, we must maintain the fluidity of the terminals," said Mr Newsome. Charleston over the past five years extended its gate times on weekdays to run from 6am until 6pm, and recently added a Saturday gate. Charleston was able to charge the shipping lines directly by increasing the gate fee charged.

The extended gates have attracted widespread support in Charleston's trucking community. "We have people waiting to get in at 6am," he said.

Oakland, which last year handled 2.39 million TEU, worked with truckers, cargo interests, terminal operators and shipping lines, to come to the consensus that a full day gate on Saturdays would be the most effective way to smooth out traffic flow.

The decision has not generated universal support, but it appears at least initially that it will satisfy the work schedules of most stakeholders while inconveniencing the fewest. Furthermore, the port intends to revisit the issue, probably after six months, and is prepared to make whatever adjustments are needed, Mr Lytle said.

To implement the Saturday gate programme, and the fee it will entail, Oakland has requested approval from the Federal Maritime Commission. Approval would come after the customary 45-day comment period of the port's request to amend the Oakland Marine Terminals Operator Agreement that is already on file with the FMC.

The California Trucking Association, in its letter to the commission, added the stipulation that Oakland's fee be charged on all containers during all hours of operation, unlike the southern California traffic mitigation fee which charges only truck moves during peak day-time traffic times.

Oakland is suggesting that a neutral third-party auditor be appointed to collect and publish the information on costs, revenues collected and monies dispersed while also preserving the confidentiality of the individual terminals, Mr Lytle said. Oakland also is seeking strict FMC oversight, he said.

On the other hand, Oakland is not the nation's busiest port complex of Los Angeles-Long Beach. Its annual container throughput is about one-fifth of southern California's volume, and the fee that is being considered is US$17 per TEU.

East coast ports such as New York-New Jersey, which have struggled with unplanned-for cargo diversions from the west coast this past year, are looking ahead to next spring when the Panama Canal expansion project is finished and large vessels up to 13,000-TEU capacity will be calling, at which point there will decide extending gate hours.

Norfolk recently expanded its gate hours on weekdays to run from 5am until midnight, while dropping its Saturday gates. New York-New Jersey's GCT Bayonne has been running Saturday gates for the past month and stated it will continue those gates until further notice. Other terminals in the largest east coast port complex have run extended gates on an ad-hoc basis.

Any port that decides to establish a formal programme of extended gates, with a fee attached, will most likely face the same problem that PierPass gate programme in Los Angeles-Long Beach has struggled with since 2005 in its relationship with truckers and cargo interests.