LONG BEACH, Calif. — Recent operational improvements should keep congestion at bay for the next few years, but the U.S. port and intermodal networks could be overwhelmed with cargo by 2010.

“The question is not if, but when, the system becomes congested,” Doug Tilden, president of Marine Terminals Corp., told The Journal of Commerce’s Trans-Pacific Maritime conference Tuesday.

Ports and railroads still feel the pain from 2004, a disastrous year when the intermodal rail networks were clogged, up to 100 vessels were forced to wait at anchor for berths in Los Angeles and Long Beach, and a severe labor shortage crippled marine terminal


The international transportation industry in 2005 corrected those problems and enjoyed a year of relative prosperity, Tilden said. Shippers and carriers relieved stress on LA-Long Beach by diverting services to the Pacific Northwest and the East Coast. West Coast employers did a much better job of managing their labor supply and hiring more longshoremen.

Railroads addressed bottlenecks at their intermodal yards and along their main lines. The Southern California ports improved productivity by reducing free storage time for containers and extending gate hours to nights and weekends. Terminal operators improved gate productivity through the use of information technology, while terminals in New York-New Jersey and Virginia managed successful chassis pools.

While these policies will be maintained in the years ahead, the big gains in productivity have been realized and future gains will be incremental, Tilden said. At the same time, cargo volumes will increase rapidly as ports in North America add a total of 4 million

TEUs a year to the current annual volume of 44 million TEUs.

What this means is that the event-driven congestion problems of the past that were spawned by railroad mergers and labor issues will evolve to systemic congestion problems that could crush the system, Tilden said.

“All components of the U.S. supply chain are stressed,” he said.

The intermodal transportation network should be able to stay one step ahead of the congestion problems over the next few years, said Jon DeCesare, chief executive of WCL Consulting in Long Beach. The U.S. economy will begin to soften later this year and remain

sluggish through 2007, helping to moderate the growth of imports from Asia. The economy will bounce back in 2008 and 2009, though, setting the stage for a surge in congestion problems by 2010, DeCesare said.

Ports in the U.S. will be unable to build their way out of danger over the next three years because of a lack of waterfront land suitable for development and environmental restrictions on expansion. Building new capacity in Canada and Mexico and at smaller U.S. gateways will help but won’t solve the problem, Tilden said.

“If the projects planned for Mexico, the U.S. and Canada are all available over the next three years, they will barely handle the three years of growth that will occur,” he said.

Existing ports and terminal operators that now average 2,000 TEUs per-acre on the East Coast and 5,000 TEUs on the West Coast much achieve 10,000 to 15,000 TEU per-acre throughput common at world-class ports in Asia and Europe, Tilden said.

Terminal operators must use a free flow of information from customers to streamline container moves from the terminal gate, through the yard and on to the vessel, just as ports in Asia and Europe now do to maintain denser, more efficient operations, he says.