Biden administration’s latest effort to ease supply chain congestion: pop-up ports

WASHINGTON — The Biden administration is working with shipping companies to launch pop-up ports to try and ease congestion at the nation’s busiest seaports and get agricultural products to consumers faster.

Five pop-up ports will open in Georgia and North Carolina that are served by trucks or rail, the Transportation Department said on Tuesday. The administration says it is hoping to open more pop-up sites in other areas soon.

A pop-up site the administration says will be opening at the CSX Rocky Mount facility in North Carolina and four others opening in Georgia are intended to reduce the backlog at the Port of Savannah, one of the nation’s busiest seaports.

“It just means that goods will flow faster in and out at the Port of Savannah, which will make manufacturers in the area, their goods cheaper, it means that agricultural exporters will be able to get their goods out to international markets more efficiently and that the entire functioning supply chain for a big chunk of the country is going to be going to be more efficient because of that,” said Carlos Monje, the under secretary of transportation for policy at the U.S. Department of Transportation.

The Biden administration announced a plan Tuesday that allows the Georgia Ports Authority to redirect $8 million in previously allocated funds for the pop-up program that will result in containers being transferred to inland locations to free up dock space at the Port of Savannah.

The administration said it is working to open the pop-up sites immediately and expects they will be up and running in the next 30 to 45 days.

The four pop-up sites in Georgia will be in Atlanta, Savannah, Chatsworth and Statesboro, the Transportation Department said.

“Global supply chain is having a huge crunch now, and that’s because of where things are getting produced in the global supply chain,” said Jayashankar Swaminathan, a GlaxoSmithKline distinguished professor of operations at the University of North Carolina-Chapel Hill who specializes in supply chain management.

“Factories had been shut for some time. Ports had been shut for some time. And so the demand has gradually been increasing and supply hasn’t been increasing at the same rate,” he said.

Many locally made products cannot circumvent the global supply chain. Nugget, a maker of children’s couches in Butner, N.C., prides itself on local manufacturing with locally sourced components. But the polyurethane foam it gets from another North Carolina producer is made with chemicals imported from Korea.

“Suppliers of foam have been slashing their client lists this year,” said Ryan Cocca, one of Nugget’s co-founders. “I think we’re still taking at least a 25% reduction, if not more.”

Sporadic deliveries from understaffed transportation companies exacerbate the issue, and the ability to ship products is also uncertain.

“We can’t get boxes,” Cocca said. “There might not even be production today because there’s not anything to ship the Nuggets in, and I think it was a half day yesterday because of that.”

COAST-TO-COAST CHALLENGE

Agricultural products would mainly move faster as a result of the pop ups, and everyday goods and rock products, which include sand and gravel, could also get to their destinations quicker, the administration said.

Agricultural shippers in particular have to contend with spoilage issues, the administration said, and are often fulfilling orders for higher paying international customers.

North Carolina has major seaports in Wilmington and Morehead City and an inland port in Charlotte, that are also dealing with logjams. The administration says its goal is to move the shipping containers to areas where operational expenses are lower, real estate is less expensive and keep goods from getting stuck in busy ports.

“A major challenge that the ports are facing, and it’s more acute on the West Coast, but it’s absolutely something that we’re seeing on the East Coast, is that because of this surge of imports, and because the lack of warehouse space in general inland is that people — the folks who own the cargo — are letting them dwell longer, spend more time at the ports themselves, and that extra volume of containers makes it harder to move things around in a lot of different ways,” Monje said in an interview with McClatchy.

He said the pop-up program came about after port envoy John Porcari asked port operators to get creative. Monje said the administration would like to expand the program.

“That is a hope, and the genesis, really, of this proposal came from envoy Porcari asking the nation’s directors to come up with short-term proposals to alleviate the crisis. And we are working with port directors to find those opportunities,” Monje said.

“We’re going to work it and try to get more of these going,” he said. “What we’re doing is trying to be a fair dealer and try to encourage the kind of efficiency that you want here.”

Last month, President Joe Biden announced that the nation’s largest port in Los Angeles would shift to 24/7 operations to help clear the congestion. The second largest port, which is in Long Beach, Calif., also expanded its hours of operation.

He pledged federal support to speed up the movement of goods through the supply chain but said that private companies also needed to step up.

“The bottom line: We’ve seen the cost of inaction in the pandemic in the delays and the congestion that affect every American. But it’s fully within our capacity to act to make sure it never happens again” Biden said in the October remarks.

The News & Observer’s Lars Dolder contributed reporting.

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