1-Year Recap of the West Coast Port Crisis – the ship that sailed

At this time, one year ago, any truck delivering containers to a West Coast port knew something was up. Terminals were slow, truck lines were long, communication between terminals and trucking companies was confusing. As an exporter, our greatest fear of that time was coming to the forefront of our world: the contract between the ILWU and the PMA that had expired on June 30, 2014 and was still being negotiated “in faith” had come to a tipping point. Multiple times did both sides confirm cargo would continue moving during negotiations – see Press Releases here – when in fact, that ended up being untrue.

By day 5 of the “West Coast Port Crisis”, I already knew what was going on – and knew that the only answer to this problem lay high above one person, one industry, or one state government. See my synopsis on November 7, 2014 here. If you want more history on the crisis, I wrote many blog posts throughout the crisis at my blog: www.DaughterofaTrucker.com.

Where are we now?

Our export industry is struggling. The impact on every industry is different. For the industry I’m involved in, grass straw exports, because of last year’s crisis and exporters not being able to get their forage to market, we had an oversupply by the time our next crop came around. For the Christmas Tree industry, we’ll see in the next month whether they lost their customers from not being able to fulfill orders last year. Washington apples lost millions in sales – one person calling it the “worst year in her career”. Will they recover, and what business did they lose?

The problem is due to two factors: the apple crop is the state's largest on record, and labor disputes at the state's ports resulted in apples sitting for too long.

The problem for the loss in apples was due to two factors: the apple crop is the state’s largest on record, and the port dispute resulted in apples sitting for too long.

I asked a colleague who is involved in international trade for his perspective as an Oregonian living in Hong Kong, Shaun Harris. He shares the following:

Usually in Hong Kong, grocery stores have produce and food items from the US. When the port slowdown happened, suddenly you couldn’t get celery and lettuce from California for instance. You couldn’t get Almond milk or Tillamook cheese from Oregon. But soon enough, those spaces were filled with Australian and European goods. (Turns out the French make a pretty good cheddar cheese.) Go back into the store today and most of those items haven’t changed back to the US product. I’m sure you’ll see the same thing playing out all over the world.

On a professional side, we spent months apologizing to customers for lack of shipments, seeing Japan’s MAFF writing USDA a letter asking them to figure it out, then a deluge of shipments once they made it out of the gridlock. Soon after, everyone was fighting overstock and soon accumulating inventories on the US side caused market prices to erode. From which, they still haven’t recovered.

Oregon Christmas Trees which were so heavily promoted here in Hong Kong ended up being cancelled and customers who ordered them got their money back.

As you can see, this was not and is not a problem that has been fixed. Just because the contract was finally “tentatively signed” in February 2015 and later ratified, the long term ramifications are very real and aren’t going away. How many U.S. companies lost customers and/or business that may or may not get them back? What was the cost to these companies? How much of the economy was hurt in the US because of the monopoly the PMA and ILWU has over all of us? What can be done to ensure this does not happen again?

Liberty Street Economics blogThese questions are impossible to answer. It’s possible the GDP of the United States suffered for the first quarter of 2015 because of the West Coast Port Crisis – just the fact it is even in question should be a wake up call for Congress, for our President, for the American people. Can you even believe it? The crisis was so bad it affected the Gross Domestic Product of the United States of America. It is baffling our administration allowed this to go on for so long.

Any help on the horizon?

Maybe. The Transportation Bill is currently being debated in Congress. Amendments to this bill include asking for port metrics to be gathered, as well as asking the GAO (Government Accountability Office) to study the effects of the port crisis are all being looked at. In addition, Congressman Newhouse (WA) will be introducing the ECONOMICS Act (Ensuring Continued Operations and No Other Major Incidents, Closures, or Slowdowns Act);  this puts in place specific “triggers,” so that when certain economic impacts surrounding a dispute occur, a Board of Inquiry must be convened, and the Board is required to report to the President and the public to recommend whether there should be a judicial injunction. There are other bills that have already failed, and I believe there are more still to come.

Can Congress fix this problem? Absolutely not, nor would I want them to. But, in the current monopoly of the PMA and the ILWU, we will need the US Government to have the information in the future if this happens again. Changing law in order to have this information for future use is imperative. I applaud specifically Congressman Reichert and Congressman Newhouse in Washington, as well as Congressman Schrader and Senator Wyden in Oregon for listening to their constituents and being instrumental in ending last year’s crisis as well as moving forward to help US trade on the West Coast.

Any other ideas?

In the words of my uncle Allan: Move to Texas. More importantly and seriously, please stay involved, stay informed, and continue to monitor the life around you. I love our state of Oregon, I love the west coast (West Coast, best coast!), and I love the United States. Unfortunately that doesn’t make it perfect. Thank you for reading.

3 thoughts on “1-Year Recap of the West Coast Port Crisis – the ship that sailed

  1. Oregon ‘s Bureau of Labor and Industry Commissioner should have been leading the charge to keep the Port operations in the spotlight of the federal government and to the benefit of Oregon producers in every industry. The damage done will take years to unravel.
    Oregon deserves better of our state elected officials.

    Like

  2. Pingback: Unfortunately: “I told you so.” | daughter of a trucker

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