NY-NJ Truckers say Off-dock Empty Box Returns Adding to Costs
Motor carriers working the Port of New York and New Jersey are asking ocean liners and shippers to pick up more of the costs the truckers say they bear as a result of relocating empty containers further away from congested marine terminals. But there’s been an uneven response to those requests amid spiraling costs for fuel and driver pay, the truckers say.
In a late March email reviewed by JOC.com, CMA CGM told motor carriers at the port of New York and New Jersey that empty containers belonging to one customer should be dropped off in Monroe Township, New Jersey, which is about 30 miles from the port. According to the email, truckers were offered $600 for the move.
The truckers were directed to the location, which also houses a car junkyard, because the containers were owned by the shipper, who is responsible for where they finally end up, and not CMA CGM.
However, sources at three intermodal trucking firms claim they were not informed when they picked up the full containers that the empties would need to be returned somewhere other than the marine terminal where they originated. As a result, truckers were blocked for returns at the marine terminal, and only later told to go to Monroe, they claim. The claims could not be independently verified. CMA CGM did not respond to a request for comment.
An Elizabeth, New Jersey-based motor carrier executive who asked not to be identified told JOC.com that the $600 offer from CMA CGM doesn’t offset the costs of using up one-third of a driver’s available workday for delivering an empty container, much less the wasted trip trying to return the empty container to the marine terminal.
“It’s 45 minutes one way [to Monroe], without traffic,” said. “It could be a four-hour trip after waiting to dismount the empty container. We don’t have the time to waste. We need to deliver containers to get them off the port.”
Along with the Monroe depot, truckers are hauling empty containers 20 miles from the port to a yard in Old Bridge, New Jersey, operated by Integrated Industries. Motor carrier sources say that Maersk and Ocean Network Express are among the carriers that have directed their empty containers to Old Bridge and have agreed to the motor carrier’s rate for the trip.
In other instances, truckers have been directed to drop off empty containers at a site in Hillsborough, New Jersey, which is about 35 miles from the port. An executive with a Long Island-based motor carrier said they would only make the move if the customer agreed to their rate.
Fuel adds 50 percent to truck rate
The need for additional trips to handle empty containers comes as drayage costs are surging due to a tight driver market and increasing fuel costs. The Elizabeth-based executive said he has had to raise rates 25 percent in the first quarter to pay drivers more.
“Drivers are leaving port work,” the executive said, adding that 20 of the approximately 170 drivers it regularly used are now operating as independent motor carriers.
In addition, fuel surcharges are now running about 50 percent of the total cost, he added, up from about 36 percent last year.
Under the intermodal industry’s standard commercial agreement, whoever owns the containers can direct motor carriers to return them to a “satellite” location other than where they were originally received.
However, the agreement says that satellite locations have to be in the same “commercial territory” as the origin point and provider. The Elizabeth executive said locations such as Monroe and Old Bridge should not be considered within the NY-NJ port’s commercial territory.
“The ocean carriers are forcing us to go there,” the executive said. “It’s not optional.”
Box return process seen as inefficient
The use of empty container yards outside the largest port on the US East Coast is becoming more urgent as the marine terminals in New York and New Jersey struggle to balance import and empty containers.
The Union-based dispatcher described the process of returning empty containers to one of the port’s largest terminals as inefficient.
He said that three lines of trucks hauling empties are funneled down to one lane that goes between the empty container stacks. Three top loaders are available to remove empty containers in the lane. But if one or two top loaders are available ahead in the lane, other trucks still must wait because trucks aren’t allowed to pass in front of the machines.
“It’s torture that it takes two hours just to drop one empty,” the dispatcher said.
Major ocean carriers at the Port of New York and New Jersey are trying to manage empty container inventories by sending in empty sweepers and using the satellite yards. But the problem is being exacerbated by new carriers that are calling New York and New Jersey.
For about a week in March, truckers returning empty containers belonging to Wan Hai Lines, which started offering an Asia service in January, were only allowed to do so if they picked up an import container, according to data compiled by drayage software provider PortPro.
The double move aimed to balance marine terminal capacity between imports and empties. In addition, Wan Hai is said to be sending in a vessel to retrieve about 1,200 empty containers from New York and New Jersey. The ship’s name and its arrival date weren’t immediately available.
By: Michael Angell / JOC