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What I don’t understand: There are two ways to get empties out of a port: On a truck or on a ship. And it seems that root cause is ships bring more containers

What I don’t understand: There are two ways to get empties out of a port: On a truck or on a ship. And it seems that root cause is ships bring more containers than they take with them. So maybe, part of the solution could be a mandate of ships to take an amount of empties?

deleted 5y ago
[deleted]
gruez 5y ago
>And it seems that root cause is ships bring more containers than they take with them. No, that's not the root cause. The root cause seems to be a combination of cascading events that causes a deathspiral: https://cdn.substack.com/image/fetch/f_auto,q_auto:good,fl_progressive:steep/https%3A%2F%2Fbucketeer-e05bbc84-baa3-437e-9518-adb32be77984.s3.amazonaws.com%2Fpublic%2Fimages%2Ffe798dbf-879b-45c6-b5ac-e57aac294cc3_2400x1256.png https://cdn.substack.com/image/fetch/f_auto,q_auto:good,fl_p... "ships bring more containers than they take with them" is a symptom, not a cause. Mandating "ships to take an amount of empties" doesn't really fix the problem because shipping companies already want the ships to fill with empties, but can't because of other factors (see chart). Forcing ships to fill ships with even more empties presumably also makes things worse, by causing ships to occupy dock space.
- kevin_b_er 5y ago
  The ports only care about inbound cargo, not outbound empties. So they have no incentive to have enough space for empties. The surge demand has suddenly depleted the free spots is removed until its a trickle. Then you get this result. The ships are stuck because the ports had no incentive to reserve space for empties. Or, something like bufferbloat.
- lostmsu 5y ago
  The last (upward) arrow in the chart does not make sense. Why would people buy more goods: as prices go up, they can buy less and less goods.
  - srhngpr 5y ago
    My guess would be to hoard goods while they can since the prices continue going up.
  - gruez 5y ago
    You might be right. In that case you might be able to cut the loop short by changing "line of ships grows..." to point to "trucks can't pick up containers...". In that case it's still a death spiral situation, but it's more similar to something like traffic jams, where throughput drops when there's bumper to bumper traffic.
  - secondaryacct 5y ago
    So you buy less and less gas for your car as you hear CNN loop on gas price rising due to supply issue ? Abd what about toys when everyone is talking about saving Christmas ? You'll make triple sure you have one, maybe even buy several from several sources. I've seen myself do that with difficult to import goods, and price is always a lower factor than need. Price would eventually push me out, but there s a twilight zone when it's just right to panic buy stuff that werent supposed to be rare.
  - manquer 5y ago
    I agree, also most people have finite and limited disposable income, no matter want/need most people can only consume so many items especially when prices are increasing.
s1artibartfast 5y ago
It is more complicated than that. Who would the mandate apply to? Ships are are basically contractors and may not own all the containers. You can charge storage fees, and some places do.
kurthr 5y ago
Maybe those containers used to be full of "recyclable" materials? It does seem that they people who have control over this situation don't have much on an incentive to improve it. In particular fixing any piece of this loop would fix the others... eventually they just ran the port cranes longer and opened up the hours that trucks could go in/out. Is it "solved"? No, but the local pre-Xmas crisis is averted, which is basically peak for the year.

deleted 5y ago

[deleted]

gruez 5y ago

>And it seems that root cause is ships bring more containers than they take with them. No, that's not the root cause. The root cause seems to be a combination of cascading events that causes a deathspiral: https://cdn.substack.com/image/fetch/f_auto,q_auto:good,fl_progressive:steep/https%3A%2F%2Fbucketeer-e05bbc84-baa3-437e-9518-adb32be77984.s3.amazonaws.com%2Fpublic%2Fimages%2Ffe798dbf-879b-45c6-b5ac-e57aac294cc3_2400x1256.png https://cdn.substack.com/image/fetch/f_auto,q_auto:good,fl_p... "ships bring more containers than they take with them" is a symptom, not a cause. Mandating "ships to take an amount of empties" doesn't really fix the problem because shipping companies already want the ships to fill with empties, but can't because of other factors (see chart). Forcing ships to fill ships with even more empties presumably also makes things worse, by causing ships to occupy dock space.

kevin_b_er 5y ago
The ports only care about inbound cargo, not outbound empties. So they have no incentive to have enough space for empties. The surge demand has suddenly depleted the free spots is removed until its a trickle. Then you get this result. The ships are stuck because the ports had no incentive to reserve space for empties. Or, something like bufferbloat.
lostmsu 5y ago
The last (upward) arrow in the chart does not make sense. Why would people buy more goods: as prices go up, they can buy less and less goods.
- srhngpr 5y ago
  My guess would be to hoard goods while they can since the prices continue going up.
- gruez 5y ago
  You might be right. In that case you might be able to cut the loop short by changing "line of ships grows..." to point to "trucks can't pick up containers...". In that case it's still a death spiral situation, but it's more similar to something like traffic jams, where throughput drops when there's bumper to bumper traffic.
- secondaryacct 5y ago
  So you buy less and less gas for your car as you hear CNN loop on gas price rising due to supply issue ? Abd what about toys when everyone is talking about saving Christmas ? You'll make triple sure you have one, maybe even buy several from several sources. I've seen myself do that with difficult to import goods, and price is always a lower factor than need. Price would eventually push me out, but there s a twilight zone when it's just right to panic buy stuff that werent supposed to be rare.
- manquer 5y ago
  I agree, also most people have finite and limited disposable income, no matter want/need most people can only consume so many items especially when prices are increasing.

s1artibartfast 5y ago

It is more complicated than that. Who would the mandate apply to? Ships are are basically contractors and may not own all the containers. You can charge storage fees, and some places do.

kurthr 5y ago

Maybe those containers used to be full of "recyclable" materials? It does seem that they people who have control over this situation don't have much on an incentive to improve it. In particular fixing any piece of this loop would fix the others... eventually they just ran the port cranes longer and opened up the hours that trucks could go in/out. Is it "solved"? No, but the local pre-Xmas crisis is averted, which is basically peak for the year.