The Port of New York and New Jersey experienced an ILA (International Longshoremen’s Association) walkout this past Friday January 29th. The walkout began around 10am, and not only affected all port terminals, but also led to horrendous trucking lines outside of the terminal gates. After speaking with customer service representatives from various shipping lines, the ILA members have returned to work Monday morning. The cause of the walkout has not yet been confirmed, but multiple sources have mentioned the ILA is not impressed with the hiring rules imposed by the Waterfront Commission of New York Harbor, which oversees port hiring.
Letter to President Obama, November 6th:
The undersigned associations representing United States manufacturers, farmers, wholesalers, retailers, importers, exporters, and transportation and logistics providers are writing to express our deep concern about ongoing interruptions at West Coast port terminal operations and to seek your help to ensure the situation does not escalate to a complete shutdown of West Coast ports. Labor contract negotiations between the International Longshore and Warehouse Union (ILWU) and the Pacific Maritime Association (PMA) began on May 15, 2014 and it seems little progress has occurred since the contract expired on July 1, 2014. Until recently, both parties to the negotiation had honored a self-imposed media blackout. While the parties to the negotiation stated earlier this year that they would continue operations throughout the negotiations, we have seen crisis levels of congestion at the ports since September. Both parties recently issued press releases accusing each other of reneging on this commitment. The sudden change in tone is alarming and suggests that a full shutdown of every West Coast port may be imminent. The impact this would have on jobs, down-stream consumers, and the business operations of exporters, importers, retailers, transportation providers, manufacturers, and other stakeholders would be catastrophic. The threat of a West Coast port shutdown is creating high levels of uncertainty in a fragile economic climate which has forced many businesses to once again undertake contingency plans that come at a significant cost to jobs and our economic competitiveness. The West Coast lockout 12 years ago cost the U.S. economy $1 billion a day. It took half a year for the ports to clear the backlog and recover from this 10-day shut down. A shutdown now could be even more costly. A new study released in June by the National Association of Manufacturers and the National Retail Federation anticipates impacts at a much greater cost in 2014 – nearly $2 billion in daily costs to the economy for a five-day interruption. Our organizations believe that both parties can reach an agreement that will ensure the continued success and competitiveness of these ports for the foreseeable future. However, we would like to see an agreement reached without any shutdowns or further disruptions. We believe immediate action is necessary and the federal government’s use of all of its available options would be helpful in heading off a shut-down and keeping the parties at the negotiating table. This includes encouraging the parties to begin working with a federal mediator through the Federal Mediation and Conciliation Service (FMCS). This approach was successful in resolving difficult negotiations for East and Gulf Coast ports just last year. Even if both parties refuse federal mediation, we believe the FMCS would benefit from beginning to monitor the negotiations. We further believe that if a strike or lockout occurs, the consequences would be so serious as to warrant you exercising the extraordinary authority granted under the Taft-Hartley Act (29 U.S.C. §§ 176-180) that would likely result in requiring the parties to work with the FMCS.
Thank you for your consideration.
(105 Trade Companies)
Congestion Up date in Long Beach / Los Angeles Ports
Los Angeles and Long Beach port authorities commence immediate changes to improve truck turn times, or risk a total meltdown in the harbor. The largest U.S. joint ports continues to suffer from congestion caused by growing cargo volumes, chassis dislocations, vessels operated by carrier alliances calling at multiple terminals, cargo surges from big ships, gate hour restrictions at terminals, a truck capacity shortage, intermodal rail delays and labor uncertainties as the ILWU contract negotiations drag on.
The Port of Long Beach is temporarily giving container cargo owners three extra days of free time to keep import containers on the docks, through Oct. 31, the time allowed shippers to get containers picked up or face demurrage or storage fees is extended to seven business days from the current allotment of four days. “The terminal congestion is very unfortunate, and a truly exception occurrence,” said John Slangerup, chief executive at the Port of Long Beach.
Two months ago, the largest container carrier in the world, Maersk Line, issued a statement to its customers concerning the Ebola crisis in West Africa, meant to calm fears. The release did not mince words, and stated one undeniable fact at its start: Ebola has never been transmitted by international shipping. Though the statement still remains true, the worldwide shipping community is feeling the effects of the disease in the form of delays and schedule changes, along with potential quarantines and ship health screenings.
TSA-Rates from Asia to North America
Members of the Transpacific Stabilization Agreement have filed for their 11th general rate increase this year in a continuing effort by carriers to shore up spot rates from Asia to North America.
Mexican intermodal volume jumped this week, reaching a high not seen in the last two years, according to the Association of American Railroads, as Mexican shippers increasingly turn to rail to protect their cargo, theft being one of the most prevalent issues in Mexico today.
The Los Angeles and Long Beach Ports are experiencing the worst congestion anyone has seen in a long time. Here are some theories that could be considered causes of the LA/LB Port congestion:
Bigger ships take longer to unload, and both of these ports see some of the biggest ships that come into the United States. The solution must be better logistics systems, as these ships will not be going away and will only be getting bigger in the future.
Cargo volumes are also increasing in these ports and will only get bigger in the coming years as trade increases throughout the world.
Chassis shortages are a major cause of the current congestion crisis. Truckers can sometimes wait for hours in a line to load the container that they need to move. Truckers are even starting to avoid these terminals as the wait is too long.
New policies relating to safety checks have been credited with the congestion of the LA/LB ports, also causing longer wait times for truckers.
There are not enough workers being allocated to the big ships that come into these ports. If more workers were available to work on these ships then there would be less turn-over time per vessel.
The holiday season is upon us once again, a busy time of the year for all. For the shipping industry it is no different with increases in container volumes moving across the globe. This makes it especially difficult when congestion occurs at shipping ports, let alone the biggest ports in the United States, Los Angeles and Long Beach.
Apart from the ongoing Longshoremen and Pacific Maritime Association contract discussions, the port of Los Angeles is also experiencing a shortage of chassis, which are essential for trucks to transport shipping containers out of the port. It typically takes a shipping container two to three days to leave a port via truck, but there have now been shipping containers that haven’t left the port of Los Angeles for up to two weeks. Truckers sit idle in hour-long lines waiting to pick up containers that do not move because of the lack of chassis’. This delay has left retailers frustrated and forced to consider alternative ports such as Oakland or Houston.
Port congestion, such as this, during the holiday season can drive merchandise prices up as there is an uncertainty from retailers whether their products will arrive or not. Let’s hope this state of congestion improves in the near future otherwise the wake of disruption at the port will be felt by us all.