Subscribe to our free, weekly email newsletter!


West Coast Ag shippers warn of prolonged dockside labor discussions

By Patrick Burnson, Executive Editor
June 16, 2014

While negotiations for a new labor contract covering nearly 20,000 dockworkers at 29 West Coast ports are continuing, shippers are urging The Pacific Maritime Association (PMA) and the International Longshore and Warehouse Union (ILWU) to come to terms for a new six-year contract quickly.

According to Peter Friedmann, Executive Director, Agriculture Transportation Coalition (AgTC), there are several compelling reasons why U.S. West Coast ports are facing “critical” challenges. 

“Powerful global and national trends that are out of your (and our) control are beginning to determine how much import and export cargo will flow through West Coast ports,” says Friedmann in an open letter to Robert McEllrath, President, ILWU and James McKenna, President & CEO, PMA. “These trends are of concern to us and should be of concern to you…we are in the same boat.”

The talks, which began on May 12, remain on the table until an agreement on coast-wide contract expires on June 30, 2014. Media reports that the talks had been “suspended” were inaccurate, says PMA spokesman, Wade Gates.

Meanwhile, Friedmann says his constituents share a number of concerns:

*Production of consumer goods, including consumer electronics, toys, processed foods, footwear, apparel, household goods, furniture, etc. will continue to migrate from North Asia (Korea, Japan, China) towards South Asia (Vietnam, Singapore, Bangladesh, India). As manufacturing moves south, it also is moving closer to the Suez Canal; what moves through the Suez Canal goes directly to the U.S. East Coast ports.

*The eastern third of the country contains two thirds of American consumers. Since the last Census, six of the seven fastest growing states were in the East/South. That is why importers of consumer goods are increasingly bringing those cargoes through the most direct route, via the Suez Canal to the ports closest to those consumers.
*Major U.S. importers, recognizing the population density on the East Coast and some of the trends above, are locating their largest distribution centers strategically, close to the East Coast populations and ports. Whether Memphis or Spartanburg or Houston, these distribution centers are closer to East and Gulf Coast ports, than to the West Coast ports, and could increasingly take market share from the West Coast.

*As manufacturing returns to the U.S., such as auto plants, it appears to be going to the “Right to Work” states, which are close to Southeastern ports. Imported components could enter through nearby Southeast ports, and finished products would then exit those ports.

*If an increasing share of our imports start entering predominantly through Gulf and East Coast ports, that is where the “empties” will be. The railroads will have to bring the containers from those locations, to the places where our agriculture is produced, or bring that agriculture by rail and transship into containers at those East and Gulf Coast ports. This will be more costly, but it will not be impossible for the flow of some (but certainly not all) ag and forest products to change directions. Instead of heading west from our Midwest, it could head east or south before being loaded on a ship. That is already happening, contends AgTC.

Tomorrow: Port productivity

About the Author

image
Patrick Burnson
Executive Editor

Patrick Burnson is executive editor for Logistics Management and Supply Chain Management Review magazines and web sites. Patrick is a widely-published writer and editor who has spent most of his career covering international trade, global logistics, and supply chain management. He lives and works in San Francisco, providing readers with a Pacific Rim perspective on industry trends and forecasts. You can reach him directly at .(JavaScript must be enabled to view this email address).


Subscribe to Logistics Management magazine

Subscribe today. It's FREE!
Get timely insider information that you can use to better manage your
entire logistics operation.
Start your FREE subscription today!

Recent Entries

The International Air Transport Association (IATA) announced August 2014 data for global air freight markets showing continued “robust”growth in air cargo volumes.

Even though some of its key metrics dropped sequentially from August to September, the outlook for manufacturing over all remains strong, according to the most recent edition of the Manufacturing Report on Business issued today by the Institute for Supply Management (ISM).

Company officials said that these planned changes, which will take effect on January 4, 2015, will provide for increases in current pay rates and reduce the time it takes for its nearly 15,000 drivers to reach top pay scale.

While the economy has seen more than its fair share of ups and downs in recent years, 2014 is different in that it could be the best year from an economic output perspective in the last several years. That outlook was offered up by Rosalyn Wilson, senior business analyst at Parsons, and author of the Council of Supply Chain Management Professionals (CSCMP) Annual State of Logistics Report at last week’s CSCMP Annual Conference in San Antonio.

Matching last week, the average price per gallon of diesel gasoline dropped 2.3 cents, bringing the average price per gallon to $3.755 per gallon, according to the Department of Energy’s Energy Information Administration (EIA).

Article Topics

News · Container · Labor Management · Seaports · All topics

Comments

Post a comment
Commenting is not available in this channel entry.


© Copyright 2013 Peerless Media LLC, a division of EH Publishing, Inc • 111 Speen Street, Ste 200, Framingham, MA 01701 USA