West Coast ports have more “damage control” ahead

Lest shippers believe that the International Longshore and Warehouse Union (ILWU) is fully on board with the new “tentative” contract agreement with the Pacific Maritime Association, consider what happened at the Port of Oakland this week.

In an episode on Wednesday, the Oakland International Container Terminal –  which provides stevedoring services for 20 shipping lines serving Asia, Europe and Central America – was shut down due to what the port describes as “a temporary setback.”

True, other terminals were operating on schedule, and only four vessels were waiting for space at the gateway’s berths, but the signal to shippers was crystal clear: the ILWU is not to be trusted.

This was reinforced by data provided by Zepol, a global trade and intelligence provider. Oakland is hardly the only victim.

Zepol (http://www.zepol.com) reports that total U.S. container imports are down over 5 percent this year, compared to January and February of 2014. Nearly the entire decline in imports was attributed to West Coast ports. The ports of Los Angeles and Long Beach, which make up a combined 40 percent of U.S. container imports, declined by 19 and 20 percent so far in 2015. East Coast ports have reaped the benefit, especially the port of New York/Newark, which increased container imports by 8 percent this year.

“The decline along the West Coast has lead to diverted shipments and a surplus in volume across the Atlantic and Gulf Coast,” confirms Zepol’s CEO and trade data expert Paul Rasmussen. “Due to these events, it’s the first time in over 11 years the port of New York/Newark has passed Long Beach as the second-largest port in the United States.”

Total U.S. imports by TEUs (twenty-foot containers) dropped from 2.93 million in January through February of 2014 to 2.78 million in 2015. Combined, the ports of Los Angeles and Long Beach have declined by over 230,000 TEUs compared to the first two months of 2014.

Most East Coast and Gulf-Coast ports haven’t seen decay, but growth in containers. The port of New York/Newark grew by over 34,000 TEUs. The port of Savannah increased 20 percent with an increase of over 40,000 TEUs and Houston rose 29 percent, by nearly 31,000 TEUs.