As United States ports continue to push through supply chain bottlenecks, many shippers look for solutions to promptly get their freight out of the ports. According to the Drayage Directory, drays originating from Savannah’s Garden City Terminal have seen rates jump 20% or more, with some increasing as much as 50% dependent upon destination. Supply Chain Quarterly echoed this statistic, shared last year that “September’s national drayage spot rate was 6% more than the previous month and 32% more than the same month in 2020.” This article will showcase five trends that elevate these numbers and promote the interest in port drayage tech.
1. Container Volume Is Still Increasing, Stimulating a Need for Visibility.
As the supply-demand continues to rise, more containers in transport create an increasing possibility for lost freight. End-to-end visibility helps prevent lost and deterred shipments before and at the port. Port drayage tech provides beneficial cargo owners (BCOs) the data they need to book drayage more effectively by bringing light to processes. This visibility is especially critical for dual transactions when a drayage truck leaves the port with a full container and returns empty on every route.
2. Increased Import Activity on the East Coast.
California’s ports congestion is causing BCOs and other supply stakeholders to consider other transportation options. Instead of taking the frequented Pacific ocean lane, many are considering adding 6,000 miles to their oceanic route through the Suez and Panama canals if it means their freight will spend less time waiting at sea. As more shippers leverage this option, there will be an increased demand for drayage services to handle the influx appropriately. One way that 3PLs at the Port of Savannah have leveraged port drayage tech is through the creation of pop-up yards to move freight fast.
3. Changing Port Authority Fee Schedules.
Port Authorities across the nation are doing their best to get freight moving as fast as possible, with some resorting to instituting fees to minimize dwell time and detention time. The Ports of Los Angeles and Long Beach are taking it a step further by incorporating clean truck fund rate fees to promote eco-friendly and efficient drayage. As the ocean and port side of transportation is more uncertain than ever, BCOs need to invest in port drayage tech to compensate for ocean delays with fast drays.
4. Limited Warehouse Vacancy Increases Drayage Need.
Increasing freight finally getting through the ports is decreasing warehouse capacity. In December, Supply Chain Quarterly reported, “Those trends will combine to fill nearly all available warehouse space in the region, with vacancy rates sinking to a scarce 3.8% at year-end 2021—a decrease over 2020 year-end levels of 4.9%.” If drays land at a maxed warehouse, the freight loses valuable while rerouted to a warehouse with available capacity. It’s becoming vital for shippers and forwarders to seek a knowledgeable port drayage tech partner with local warehouse and distribution solutions to ensure their freight avoids delays.
5. Interest in Sustainability and Intermodal Transit.
As sustainability continues to rise in importance corporately, more BCOs are strategizing their freight movement from drayage to delivery with options such as railway. By utilizing intermodal transit, more drayage trucks arrive at rail ramps to consolidate shipments. Although incorporating rails creates more fuel-efficient transportation, this also complicates freight management due to the needs for consolidation, deconsolidation, temperature storage, and more. Advanced port drayage tech can assist BCOs and their local partners to handle these complex transportation needs successfully.
Stay Future-Ready in Port Drayage With PortCity.
As port trends continue to ebb and flow in 2021, BCOs, shippers, and forwarders must stay in tune with the current drayage environment and future possibilities. While the East Coast may have openings today to accommodate rerouted freight from the cramped ports on the West Coast, rates will continue to rise to accommodate the increased container volume. Stay current and competitive – get your logistics plan started with PortCity today.