Some carriers are sending empty containers back to Asia
By Diego Flammini
Several American ag organizations are concerned with transportation delays at U.S. ports.
Multiple marine carrier companies are sending empty containers back to Asia after those containers have been offloaded in the United States.
High demand for consumer goods coming into the U.S. from Asia has led to disparities in freight rates.
Marine carriers are taking advantage of these rates because it’s profitable.
“The freight rates on containers coming into the U.S. are so high that carriers actually have an incentive to offload the containers and send them back empty so they can continue to get that higher freight rate,” Travis Arp told Farms.com.
Arp is the senior director of export services and access covering Asia, the Middle East and Oceania with the U.S. Meat Export Federation (USMEF).
For exports coming from Asia into the U.S., carriers can charge around $10,000 per container. But the rate for products going from the U.S. to Asia is around $1,000 per container, he said.
“If carriers are looking at this thinking they can get 10 times the dollars per container, why would they fill the containers when they can get the containers back to Asia and loaded as quickly as possible?”
The issue with the marine carriers is only one of multiple issues affecting U.S. ag exports.
Labor availability is another challenge right now.
Because of the pandemic, staffing levels are lower than usual, which is also leading to delays.
“There’s a shortage of long shoremen to turn these ships over,” Arp said. “There’s lots of ships sitting at anchor in ports waiting to be unloaded and are backed up by multiple weeks. And then once those ships are unloaded you’ve got containers stacking up as well.”
The USMEF and 70 other ag groups have written to President Biden’s administration to raise awareness about the container issues.
The government needs to act quickly before any further damage is done to the ag sector.
“Given the urgency of this situation in commerce, we ask that (any tools) available to our government be immediately applied to stem the current ocean carrier practices that are so damaging to our agriculture exports,” the letter says.
International ocean carriers transport over 99 percent of U.S. foreign commerce.
If this issue persists, it could damage America’s reputation as a reliable ag supplier.
“If this situation is not quickly rectified, we risk not being able to fulfill contracts to send product to Asia – one of our largest markets – in a timely manner,” Maria Zieba, director of international affairs with the National Pork Producers Council, told Farms.com in an email. “These export delays are causing supply chain backups and need to be addressed urgently.”
“A lot of what we sell in our important markets is consistent supply,” Arp said. “That’s thrown into turmoil when you’ve got backups. We’ve had exporters who usually deliver multiple containers per week tell us they may do one drop per month.”