West Coast Port Talks Drag On
This story appears in the Dec. 15 print edition of Transport Topics.
Labor talks at West Coast ports dragged into their eighth month last week, with continued reports of cargo slowdowns, freight diversions and officials pleading for a tentative agreement.
Negotiations were continuing at press time, with a scheduled pause for a union caucus beginning Dec. 15, where a contract would be reviewed if a tentative agreement is reached, International Longshore & Warehouse Union spokesman Craig Merrilees told Transport Topics.
On the docks, there has been no improvement in productivity as cargo arrivals slow prior to the holidays, said Wade Gates, a spokesman for the Pacific Maritime Association. That group has been negotiating on behalf of terminal operators and ocean carriers since May.
The latest sign of persistent congestion was a statement from an alliance of six ocean carriers, known as G6, that one of their services would avoid Los Angeles, the nation’s largest port.
“With regards to the current U.S. West Coast situation, G6 Lines agreed to temporarily suspend the eastbound Los Angeles call on its Pacific Atlantic 1 service,” said the statement posted on the website of Hapag Lloyd. “A review of the congestion situation will be done in due time. We apologize for this action, which is inevitable to avoid further delays in congested ports.”
The move will continue throughout January. The other G6 members, including Japan-based NYK Line, also are among the 20 largest ocean carriers.
Separately, the carriers’ Transpacific Stabilization Agreement discussion group, composed of 15 major U.S.-Asia container lines, urged companies to raise rates $1,000 per 40-foot container unit on Dec. 15. That came after the same companies withdrew congestion surcharges following shipper and Federal Maritime Commission opposition.
Los Angeles and Long Beach port directors underscored their desire for a resolution at an industry event earlier this month. Los Angeles officials are in contact daily with the White House regarding the situation, port spokesman Philip Sanfield told TT.
Shipper groups such as the Agricultural Transportation Coalition and the National Retail Federation have been trying to have President Obama inject a federal mediator into the talks.
“Retailers instituted costly contingency plans early on to ensure that holiday merchandise would be on the shelves or sitting in a warehouse ready to go,” NRF Vice President for Supply Chain and Customs Policy Jonathan Gold said. “However, we are still hearing from retailers experiencing delays at West Coast ports, and retailers are also looking ahead to the spring season.”
The retailers’ trade group, in conjunction with consultant Hackett Associates, projected a seasonal slowdown in December cargo arrivals at 10 of the largest ports. The Port Tracker report predicted that imports at 10 of the largest ports will total 1.37 million industry standard 20-foot units. That is down 14% from the September record at ports on the West, East and Gulf coasts that are part of the report.
That report indicated that import shipments will rise 6.2% from last year. First quarter growth was pegged at 4.2%.
