Intermodal Chassis Availability for Containerized Agricultural Exports

Abstract

Containerized shipping accounts for a significant percentage of United State’s international trade. The provisioning of the “appropriate” container and chassis is critical to the success of U.S. agricultural exports. The availability of containers and chassis is viewed by many market participants as one of the most significant sources of inefficiencies in the intermodal logistics system, and a major impediment to expanding U.S. agricultural exports. This study addresses the factors that impact the provisioning of “the right” containers and chassis at the “right time” for the movement of agricultural commodities through the Ports of Los Angeles, Long Beach, and Oakland. The volume of containers transiting through these ports has grown several fold since the 1990s. This trend mirrors growth in trade, particularly with Asia-Pacific countries. The container volume data attaching to these ports shows large variability in monthly volume movements. Excessive volume variability creates significant uncertainty, causing planning and execution problems for the various stakeholders in the import-export logistics chain. This is particularly true for truckers, shippers, and freight forwarders serving the agricultural export sector, as the “optimal period” for exporting food products usually coincides with the peak of import-export volume imbalance at these ports. Understanding of the dynamics of aggregate container movement at these ports is critical for developing strategies that can help mitigate the problems arising from shortages of equipment, such as containers and chassis. Thus, the primary purpose of this study is to characterize the dynamic pattern of container transit through these ports, its impact on chassis availability, and its implications for containerized agricultural exports (particularly HPVs). To this end, we study the historical container movements at these ports and delineate the seasonal patterns that lead to imbalances in demand and supply of containers and chassis. Based on our statistical analysis and insights from key stakeholders, we identify a number of impediments to the efficient movement of containerized agricultural exports. Several important insights, including economic policy tools and incentives schemes, emerge from our analysis. Our study, the literature reviewed, and the feedback we have received from on-the-ground stakeholders make clear that there is no “one-size fits all” solution for containers and chassis shortages appropriate for all U.S ports. Instead, we present three strategies to mitigate and potentially alleviate the perennial equipment shortages that disproportionately impact agricultural exporters at these ports.