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Vessels backing up at an alarming rate on the West Coast

 | Jan 28, 2015 9:21PM EST

Vessels are backing up at an alarming rate at West Coast ports due to congested marine terminals and work slowdowns by the International Longshore and Warehouse Union.

The Marine Exchange of Southern California reported Wednesday that 17 container ships were at anchor and awaiting berths in Los Angeles-Long Beach. Oakland reported that five container ships were at anchor, and Tacoma reported six at anchor.

This is a dangerous condition because vessel backlogs upset the weekly scheduled sailings from Asia to the West Coast, and that has a cascading effect throughout the market. The Paris-based consultancy Alphaliner reported this week that vessels have been thrown off schedule by as many as three weeks, forcing carriers to add 36 additional ships to their trans-Pacific rotations to the West Coast. Furthermore, some carriers are running “extra-loaders” on all-water services to the East Coast. These unscheduled, single-voyage vessels carry cargo that would otherwise have moved through the West Coast.

Port congestion on the West Coast has been building since last summer, and Alphaliner said that it is now the “worst-ever case of U.S. port congestion on record,” an observation that’s hard to argue with.

Meanwhile, contract negotiations between the ILWU and the Pacific Maritime Association are on-going and were continuing all day on Wednesday, said ILWU spokesman Craig Merrilees. Negotiations began on May 12, 2014. The ILWU has been working without a contract since the previous agreement expired on July 1.

West Coast ports have struggled with mounting congestion since last summer. A number of factors contributed to the problem, including big ships operated by carrier alliances that generate huge container volumes in a single vessel call. In Los Angeles-Long Beach, the largest vessels generate as many as 10,000 container moves per call. Since the vessels carry containers from as many as six different carriers, the containers are spread out over multiple terminals, creating a logistical nightmare for truckers and equipment providers. Chassis shortages and dislocations and service issues on the transcontinental rail networks compounded the congestion problems.

Port congestion deteriorated rapidly at the end of October when the ILWU implemented work slowdowns in Seattle-Tacoma and Oakland. The PMA said the slowdowns were orchestrated by the union to exert leverage in the contract negotiations. In Los Angeles-Long Beach, the ILWU cut down the daily dispatch of skilled yard crane operators from 110 to 35, bringing the largest U.S. port complex to near gridlock, the PMA has stated.

The ILWU blames the gridlock and backlog of vessels at anchor on two issues -- pre-existing port congestion since last summer and a decision by employers late last year to suspend all night shifts at Seattle, Tacoma and Oakland, and to suspend vessel unloading (but not yard and gate operations) on the night shifts in Los Angeles-Long Beach.

The PMA said that since terminals in Southern California are operating at 95 to 97 percent of capacity, employers decided to suspend vessel unloading on the night shifts in order to clear out some of the container backlog in the yards to make room for containers to be discharged on the next morning when vessel unloading resumed.

Contract negotiations in San Francisco have been held under the auspices of the Federal Mediation and Conciliation Service since Jan. 6. A possibly significant breakthrough was made on Monday when the PMA confirmed that a tentative agreement had been reached on the issue of ILWU jurisdiction over container maintenance and repair. That issue had been holding up the negotiations since the beginning of the year.

However, other issues such as wages, pensions and the length of the new contract must still be resolved.

The congestion is also showing up in diversion of cargo to ports in Canada and on the U.S. East Coast. Container volume in Los Angeles-Long Beach declined 1 percent in December compared to December 2013, while East Coast gateways as well as Prince Rupert, Canada, were reporting double-digit growth.

Courtesy of www.joc.com


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West Coast newspapers side with port employers in call for federal mediation

JOC Staff | Jan 05, 2015 10:39AM EST

Two more U.S. West Coast newspapers have come out in support of a federal mediator to enter the stalled and increasingly acrimonious West Coast longshore negotiations, effectively siding with employers who have called for mediation.

The International Longshore and Warehouse has not agreed to mediation through a spokesman told the Seattle Times on Friday that the option is under consideration.

The editorials further ramp up public pressure on the union to agree to mediation as a way to resolve negotiations under way since May with no resolution after months of disruption on the docks that have led to delays losses for importers and exporters. They follow earlier editorials in December calling for mediation and criticizing the stalemate. The new editorials, in the Seattle Times and Long Beach Press Telegram, were balanced in not blaming one side or the other for the impasse.

In an editorial on Jan. 4, the Seattle Times said, “It’s time for a mediator to help forge an agreement to get ports functioning at full speed again,” citing the impact on the state’s potato and apple crops. “Instead of improving the movement of goods and making the ports more efficient, the stalemate is hurting the trade industry that is vital to Washington’s economy.”

The Long Beach Press Telegram said in an editorial that the ongoing impasse and its impact is “simply inexcusable. Enough is enough. It’s time to call in a federal mediator and resolve contract negotiations.”

The two sides, it said, “should go to the table in front of a federal mediator and argue their cases. Let an objective third party handle the sticky labor issues of pensions, work rules and jurisdiction.”

The New Year began with no breakthrough in sight. The Pacific Maritime Association, which represents employers, moved forward last week with a plan to call out fewer dockworkers to work ships saying the marine terminal container yards are full due to what it says is the ILWU’s refusal to provide adequate labor to work the yards.

Courtesy of www.joc.com


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