West Coast Ports Finally Resume Full Operations


by Laura Stevens, Wall Street Journal

West Coast ports are finally working at full speed again—for the most part— but it will likely take months for the backlog to clear, port officials and logistics experts said.

Full operations resumed at West Coast ports Saturday evening, after the International Longshore and Warehouse Union and the Pacific Maritime Association, which represents employers, came to a tentative agreement on a new five-year labor contract late Friday. The contract still must be ratified by members.

Not everything went smoothly. Workers at the Port of Oakland on Sunday took their breaks together, and employers dismissed them, according to a PMA spokesman. An arbitrator ruled that the union’s action was an illegal work stoppage, and employers ordered new crews for the night shift.

On Sunday morning, the number of ships at anchor waiting to get into the ports of Los Angeles and Long Beach had increased to 31 from 27 Friday. Another couple dozen ships were either nearby or on their way to the ports.

“Just based on the mathematics, it will be about three months before we return to a sense of normalcy,” said Gene Seroka, executive director of the Port of Los Angeles.

In 2002, a 10-day lockout involving the same groups cost the U.S. economy an estimated $1 billion a day, and it took two to three months to return to normal. This time, while the labor dispute never resulted in total port shutdowns like a lockout, the slowdowns were spread out over a longer period. They began roughly in November as the union stopped sending enough workers and increased in January and February as employers cut evening and weekend shifts.

Port and logistics experts estimated it could take anywhere from about two to six months to get the U.S. supply chain—which makes sure T-shirts end up on shelves and auto parts are available for manufacturing—back on track.

Port problems have been causing widespread pain for shippers, retailers, meat and poultry companies and manufacturers across the country. Farmers couldn’t get produce to Asia, leaving some fruit rotting in containers, and some auto manufacturers were forced to fly in parts to keep plants running. Small-business owners with limited inventory to cover sales faced shortages, while some apparel companies feared they wouldn’t get products in time for spring delivery.

Farmers producing crops including oranges, potatoes, Christmas trees and soybeans have all been hard hit, as cargo arrived spoiled in Asia or couldn’t get there at all, said Peter Friedmann, executive director of the Agriculture Transportation Coalition. U.S. farmers are already competing with similar crops being grown around the world as the dollar strengthens, and the slowdown has been a tough blow, he said.

Farmers may have a hard time winning back customers lost over the past couple months, he said, adding, “People who are sourcing these products can’t afford a lack of dependability.”

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Source:  Wall Street Journal


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