There were 108 container ships at anchor or drifting off the San Pedro Bay approach as of October 14, 2021, a new all-time record for the complex. The Biden administration announced a White House port envoy and committed the Port of Los Angeles to 24/7 gate hours. The terminals at LA and Long Beach announced a Container Dwell Fee of $100 per container per day, rising daily, for boxes sitting past nine days for rail moves and six days for truck moves. Walmart, Target, Home Depot, Costco, and Samsung all confirmed they were chartering their own vessels to bypass the main trans-Pacific liner services.
If you are a chemical importer with a container on one of those 108 vessels, or with a PO that’s supposed to sail out of Ningbo in the next two weeks, you are out of time to hope this clears up. Your cargo is sitting on the water or in a Chinese yard, and the decisions you make between now and month-end determine whether you keep your US customers supplied through Q1 2022 or start losing accounts.
This is the practical playbook: what to do right now, this week, and this month. Divert, reroute, pull forward, renegotiate, and cap your exposure. Specific moves with specific numbers.
The 108-Vessel Record and What It Actually Means for Your Cargo
The Marine Exchange of Southern California’s October 13 report logged 108 vessels waiting, with 60 of them at anchor and another 48 drifting in deep water because the anchorages are full. For context, the pre-pandemic norm was zero to one vessel at anchor. The complex has been above 30 vessels since June, above 50 since August, and now it’s flirting with three digits on a weekly basis.
Wait times before berthing have extended to 13 to 18 days depending on terminal. Some vessels have sat at anchor for over three weeks waiting for a berth at APM Terminals Pier 400 or TraPac. Once berthed, discharge rates have also slowed because yard density at LA/LB is running at 95%+ utilisation. Terminals are literally running out of physical space to put boxes.
The White House 24/7 announcement on October 13 sounds like it should move the needle. In practice, it won’t, at least not quickly. The bottleneck isn’t gate hours. It’s chassis availability, warehouse space, and drayage capacity. Extending gate hours when chassis are already parked under loaded boxes in customer yards doesn’t create new chassis. It creates the theoretical option to move more containers that nobody has chassis to move.
The Container Dwell Fee and Why It’s Aimed at You
On October 25, 2021, POLA and POLB plan to implement the Container Dwell Fee: $100 per container per day for containers dwelling nine days or more for rail and six days or more for truck, compounding daily by $100. So a container that sits 10 days on truck incurs $500 on day 10 alone ($100 + $200 + $300 + $400 + $500? actually it steps up: day one of dwell above threshold is $100, day two $200, day three $300, cumulative, and the fee is charged to the ocean carrier who will absolutely pass it to you).
The fee is aimed at ocean carriers, and the carriers will contractually pass it through to the beneficial cargo owner. Check your bill of lading. You will find the pass-through clause if you look for it. A container that sits 12 days past the six-day truck threshold (so 18 days total terminal dwell) will accumulate fees in the thousands of dollars. For chemical importers running ISO tanks or specialty packaging, you need to get boxes out of the terminal before that clock starts.
The practical response is two-fold. First, you need a chassis on the ground the day your container discharges, and you need your drayage carrier to pick it up and move it. Second, if your warehouse or consignee can’t receive the box within the free time, you need a drop yard. Paying $45 per day for drop yard storage is a better deal than paying $300 to $600 per day in compounding dwell fees.
Port Diversion: Oakland, Tacoma, Prince Rupert, Houston
This is the single most impactful move most chemical importers can make right now, and too few are making it. LA/LB isn’t the only deepwater gateway for Asia-Pacific cargo. It’s just the most congested.
Oakland has been running an anchor queue of 0 to 6 vessels through most of Q3 and early Q4. Ocean freight rates to Oakland are essentially identical to LA/LB on major trade lanes, roughly $16,000 to $18,000 per 40-foot container from Shanghai or Ningbo as of mid-October 2021. Terminal handling and drayage costs in the Bay Area are higher than LA basin, but they’re real and available. If your consignee is in Northern California, Nevada, Oregon, or anywhere west of the Rockies other than LA basin, Oakland is faster and cheaper door-to-door right now.
Seattle and Tacoma (the Northwest Seaport Alliance) have congestion of their own, running around 10 to 18 vessels at anchor, but that’s a fraction of SoCal. Transit times via Seattle to Midwest rail ramps are 1 to 2 days longer than LA, but with current LA dwell times, you’re often still faster. BNSF and UP rail service out of the Northwest has been less congested than out of LA.
Prince Rupert, Canada, is the sleeper option. The port of Prince Rupert runs fast, has a direct CN rail service into Chicago and the US Midwest, and has maintained relatively low congestion through 2021. Ocean transit from Shanghai to Prince Rupert is actually shorter than Shanghai to LA by approximately 2 days because it’s a more northerly great-circle route. For Midwest or East Coast chemical consignees, Prince Rupert plus CN rail is a genuine alternative. Customs clearance into the US is handled via in-bond transit from Prince Rupert to the US rail ramp.
The Gulf Coast, specifically Houston, is a longer ocean transit, 30 to 35 days from China via Panama, but Houston hasn’t been meaningfully congested and for chemical importers with Gulf Coast customers or storage, it can be the most operationally sensible route. The Panama Canal has handled the New Panamax-sized vessels well since the 2016 expansion.
| Discharge Port | October 2021 Anchor Queue | Ocean Transit from Shanghai | Typical FAK 40ft Spot Rate | Inland to Chicago | Best Fit |
|---|---|---|---|---|---|
| Los Angeles / Long Beach | 90 to 108 vessels | 16 to 22 days | $16,000 to $18,000 | 4 to 7 days rail | If cargo must land SoCal |
| Oakland | 0 to 6 vessels | 16 to 20 days | $16,500 to $18,000 | 4 to 6 days rail | NorCal, PNW, Nevada |
| Seattle / Tacoma | 10 to 18 vessels | 13 to 17 days | $17,500 to $19,500 | 3 to 5 days rail | Midwest, rail-heavy |
| Prince Rupert, BC | 0 to 4 vessels | 12 to 15 days | $15,500 to $17,500 | 3 to 4 days CN rail | Midwest, East Coast |
| Houston | 4 to 9 vessels | 30 to 35 days | $14,500 to $16,500 | 2 to 4 days truck/rail | Gulf, SE, Texas |
Run the maths on your specific lane. For many chemical importers, the all-in landed cost via Oakland or Prince Rupert is actually lower than LA/LB once you bake in realistic demurrage, detention, and chassis costs.
Pulling Forward: Moving October Inventory Into September Sailings You Can’t Do Anymore, So What Next
You can’t pull forward October orders into September at this point because September sailings are full and already sailed. What you can do is pull forward December and January orders into November and early December, and lock in the booking window now. Peak season runs through early November on the trans-Pacific, then tapers. December sailings will have more space than October sailings, but you need to book now, not in three weeks.
This has financing implications. Pulling forward inventory means tying up working capital 30 to 45 days earlier than planned. For a chemical importer with a $3 to $5 million quarterly buy, that’s $200,000 to $400,000 of incremental working capital. Work with your bank or finance team on a temporary line adjustment.
It also has warehouse implications. US warehouse vacancy rates in major logistics markets are running below 4%, the lowest in decades. If you’re planning to land an extra month of inventory, you need the storage locked in before the cargo arrives. Third-party logistics providers in the Inland Empire, Phoenix, Dallas, and Atlanta are all running tight.
Renegotiating Incoterms: The Move From FOB to DDP That Actually Makes Sense Right Now
A lot of US chemical importers buy on FOB China terms. You own the cargo from the moment it passes the ship’s rail, you book your own freight, you pay the freight, you pay the duties, and you pay the destination charges. In a normal freight market, FOB gives you control and typically the best total cost.
In October 2021, that logic has partially inverted. Large Chinese chemical traders with FAK contracts to COSCO, OOCL, CMA CGM, and Evergreen have freight allocation you can’t replicate on spot. They can get your container loaded in week 43 while your NVOCC on spot can’t get space until week 48. For certain products and suppliers, moving from FOB to CIF or even DDP, where the Chinese seller handles logistics all the way to your door, is worth a 5 to 10% premium on the landed price because it actually gets the cargo delivered.
The caveat is you need to verify the Chinese supplier’s freight arrangements are legitimate. Ask for the carrier’s booking confirmation, the vessel name and voyage, and the bill of lading when it’s issued. Some less scrupulous traders will quote DDP and then sit on the cargo hoping the freight market eases.
For ISO tank shipments of liquid chemicals, the logic is different. Chemical tank operators like Stolt, Odfjell, and Den Hartogh run their own tank networks with dedicated allocations that don’t go through the container spot market. Your freight forwarder or direct contract with the tank operator matters more than the Incoterm.
A Worked Landed Cost: LA vs Oakland vs Prince Rupert for a Chemical Container
You’re importing 20 MT of Chinese calcium hypochlorite (HTS 2828.10, Section 301 List 3 at 25%) in a 20-foot dry container, ex-works Jiangsu, destined for a water-treatment distributor in Denver, Colorado. Product cost is $1,450/MT ex-works.
| Cost Component | LA/LB Route | Oakland Route | Prince Rupert Route |
|---|---|---|---|
| Ex-works product (20 MT at $1,450) | $29,000 | $29,000 | $29,000 |
| China inland + export clearance | $650 | $650 | $650 |
| Ocean freight (20ft dry, FAK) | $9,800 | $10,100 | $9,400 |
| Peak season and congestion surcharges | $1,400 | $900 | $500 |
| US customs clearance and MPF (or in-bond to PR) | $360 | $360 | $420 |
| HMF (harbour maintenance fee) | $45 | $45 | $0 (Canadian port) |
| Section 301 duty (25%) on $29,650 customs value | $7,413 | $7,413 | $7,413 |
| Terminal handling | $380 | $420 | $310 |
| Demurrage allowance (LA assumes 5 chargeable days) | $1,150 | $180 | $90 |
| Chassis and drayage premium | $780 | $520 | $280 |
| Inland transit to Denver | $1,950 (rail from LA) | $2,100 (rail from Oakland) | $1,700 (CN rail via Chicago interchange) |
| Estimated dwell fee exposure (Oct 25+ POLA/POLB) | $600 | $0 | $0 |
| Total landed cost | $53,528 | $51,688 | $49,763 |
| Per MT | $2,676 | $2,584 | $2,488 |
Prince Rupert lands this container at $188/MT cheaper than LA, and that’s before you account for the transit-time saving of roughly 14 days door-to-door. Oakland is $92/MT cheaper. For a chemical importer running 50 to 100 containers a year through LA/LB, the diversion maths is worth six figures.
Demurrage and Detention Discipline: The Operational Tightening
Congestion amplifies demurrage and detention exposure. Terminals charge demurrage for containers sitting at the port past the free time, typically four to five days for dry containers and three days for ISO tanks. Ocean carriers charge detention for their containers sitting outside the port past the return window, typically seven to ten days.
In a normal freight environment, you can manage this with basic planning. In October 2021, with chassis scarcity and terminal dwell running long, you can accumulate thousands of dollars of charges without anyone on your team doing anything wrong. The container is on the ground at the terminal, there’s no chassis available to pull it, and the meter is running.
Operational moves that work. Negotiate free-time extensions with your carrier up front, before the cargo ships. Many carriers will extend to seven days for truck and eleven days for rail on request if you commit volume. Build a direct relationship with at least two drayage carriers in your destination market, not just one. Carriers get throttled. Your second carrier bails you out. Use a drop yard with a long-term storage rate if your warehouse is bottlenecked. Drop yards in the LA basin charge $25 to $45 per day. Compared to $300+ per day in terminal demurrage and upcoming dwell fees, it’s a clear win.
And on the contracts side, write detention and demurrage caps into your NVOCC or forwarder agreements. Not every provider will agree, but some will accept a $2,000 per container cap on destination dwell charges if you commit meaningful volume.
What to Watch Through Year-End and Into 2022
The SoCal anchor queue is not going to drop below 50 vessels before January. Peak season imports run through early November, Lunar New Year blanking on trans-Pacific sailings kicks in February, and ILWU contract negotiations for the West Coast port labour agreement begin in earnest early in 2022. Any labour uncertainty at LA/LB in May through July 2022 will push more cargo to alternative ports.
The container dwell fee, which takes effect October 25, is a forcing function. Watch how aggressively POLA and POLB actually assess it and how fast carriers pass it through. Watch whether Oakland and Prince Rupert congestion increases as diverted cargo arrives. Watch the November and December FAK spot rate out of Shanghai, which will tell you whether the worst of the peak-season freight market is behind you.
For any chemical importer with material China exposure, October 2021 is the moment to finish the contingency planning you probably started but didn’t complete in April. Divert a portion of your volume now. Pull forward what you can. Cap your demurrage exposure. Get your Incoterms right. The US ports are going to be messy through at least the first half of 2022, and the importers who come out of this with customer relationships intact are the ones who diversified their routing this month, not next quarter.