Ports Open For Business Despite Disruptions
In just a couple months, COVID-19 has made abundantly clear the interconnectedness of the global economy, the fragility of the supply chains that drive it, and the resiliency of the ports and terminals that move those cargoes.
Now, a month or more into social-distancing measures across much of the United States, ports and terminals themselves remain, for the most part, fully functional, according to Aaron Ellis, public affairs director for the American Association of Port Authorities.
“The general picture is that most North American ports are fully operational for cargo business but have closed or restricted operations for passenger vessels, especially cruise ships,” Ellis said. “The vast majority of ports are trying to have all cargo-related services operational 24/7 while ensuring a safe working environment for shore and office personnel.”
The U.S. Coast Guard, the Centers for Disease Control and Prevention, and Customs and Border Protection have all issued guidelines regarding port activities during the pandemic. In general, those protocols require crew members aboard ships that have called on ports in mainland China within the past two weeks the remain onboard while the vessel is in port. Likewise, if an individual crew member has traveled to China within that period of time or if a crew member is ill, the vessel’s master must immediately notify the Coast Guard.
Ports, like all essential businesses that are remaining at work during social distancing and stay-at-home orders, have implemented heightened safety and sanitation standards in an effort to prevent the spread of COVID-19.
“As far as our terminals go, early on, the port, our terminal operators and the International Longshoremen’s Association recognized the potential threat of community spread and proactively implemented enhanced protocol at the terminals,” said Port of New Orleans President and CEO Brandy Christian, “including temperature screenings, increased sanitization of equipment and use of disinfectants at the docks and railroads, as well as recommended social distancing practices.”
Terminal workers are following precautionary measures implemented by the port’s private terminal operators, Christian said. In addition, on April 8, the port initiated non-contact thermometer temperature screenings at the entrances to its Nashville and Napoleon Avenue terminals and at the local International Longshoremen’s Association hiring hall. Two days later, screenings were added at the port’s security gate at Felicity Street. According to the port, people with a temperature of 100.4 degrees Fahrenheit or higher will be denied entry and advised to contact a company representative. The port’s administration building is also closed for the time being.
“We have implemented rigorous screening and cleaning measures to help ensure a healthy workforce and are in very close contact with our tenants and labor leaders so we all have accurate information and can respond quickly to emerging issues,” Christian said.
Paul Aucoin, executive director of the Port of South Louisiana, said his port has also enhanced cleaning, screening and social distancing measures.
“Disinfecting work areas is taking place at crew change, plus personnel conducts crew change/debriefings outdoors where they can keep their ‘social distance,'” Aucoin said. “As per the CDC and the Louisiana Department of Health, personnel have been issued rubber gloves and masks, plus disinfectant spray and wipes are available to clean all surfaces at each crew change.
“We also have a brief questionnaire for the truckers about how they feel, where they have recently traveled, and whom they have been in contact with,” particularly whether drivers have been exposed to someone with COVID-19, Aucoin added. “Essential personnel who report not feeling well are asked to go or stay home.”
Early on in the known spread of COVID-19 in the United States, a longshoreman working at the Port of Houston’s Bayport and Barbours Cut terminals tested positive for the virus. In that case, the port temporarily suspended activity at the terminals and, in conjunction with the International Longshoremen’s Association, conducted an investigation to determine who that worker had interacted with in the days prior to falling ill. Those with direct contact were required to self-quarantine.
“We have taken prudent steps to ensure we resume operations responsibly and safely,” according to a March 19 statement from the port. “We will be resuming vessel operations this evening at 1900 at both container terminals and will reopen both container terminals for normal business tomorrow morning.”
The Houston terminals were closed less than 24 hours. Other facilities and the Houston Ship Channel were unaffected by the brief terminal closure.
While actual cases of COVID-19 haven’t had a broad impact on operations at seaports, disruption to the global supply chain because of the virus certainly has. With much of society in the United States and around the world shut down, demand for many goods is simply not there.
Many nonessential retail stores and warehouses are closed, with workers furloughed due to stay-at-home orders, so those cargoes are being parked in the containers in which they arrive, “which creates logistical problems for ports trying to find room to handle essential cargoes,” Ellis said.
Early on, there were fears that containers left in port by importers would overrun container yards. Ellis said, in large part, those fears have not yet materialized.
Still, due to market pessimism and the depressed job market, the demand for many items is simply not there.
“This reduced demand for goods is causing cargo owners to cancel shipping orders, which is again reducing vessel calls and work opportunities for the 652,000 people directly employed to handle port-related cargoes, as well as the 31 million jobs that those port cargo activities support,” Ellis said. “Consequently, some ports are having to cut their hours, and sometimes even days, of operation to respond to the diminished cargo volumes.”
Christian said that so far, the Port of New Orleans has seen a normal volume of vessel calls, with only two port calls canceled due to reduced manufacturing in China. Christian said container volumes at the port are actually up as of February compared to last year, but she doesn’t expect that trend to continue as the year progresses.
“We expect to see more of an impact to volumes in the second quarter as the impact of the slowdown in global manufacturing and consumption is realized,” she said.
Two segments where the Port of New Orleans has seen drops in volumes include cargoes related to the oil industry and breakbulk cargoes, particularly raw materials. That, in part, has to do with trade tariffs.
“Ports like ours across the country are also being impacted by North American production slowdowns and stoppages, for example in the automobile industry, which would impact raw materials such as rubber and steel,” Christian said.
Christian said the port is taking a conservative approach to its forecast for fiscal year 2021.
“Given the enormous disruptions to manufacturing, the supply chain, and consumer and industrial demand, we do believe it will take some time for normal patterns to re-emerge,” she said. “It is still too early to project the long-term effects.”
On the export side, Ellis said China’s first quarter shutdown due to the virus drastically impacted raw material transport from the United States. Likewise, due to minimal demand for vehicles around the world, roll-on, roll-off carriers are cutting movements.
“Only tanker operators appear to be weathering the virus crisis,” Ellis said. “Crude carriers are doing pretty well as oil importing countries and traders are buying oil to replenish their strategic reserves and for oil storage at record low prices. However, if there is a protracted worldwide recession, it could significantly reduce oil demand in the foreseeable future.”
Ellis, like Christian, said predicting the long-term impact on trade is difficult.
“Hard to say what overall container volumes will be for the rest of 2020, but likely similar to the decline following the 2008 financial crisis, which saw container volumes drop about 10 percent on average compared to the year before,” he said.
More Coronavirus-related stories in the WJ:
April 20 issue:
April 13 issue:
April 6 issue:
March 30 issue (online only):
March 23 issue:
March 16 Issue:
March 9 issue:
March 2 issue:
February 17 issue:
February 10 issue: