Transportation and Oregon – a love/hate relationship – Part 1

Transportation isn’t sexy. And when it works, no one talks about it. We fly under the radar for the most part. Now, it seems that every time you turn around, someone is talking about transportation. It could be congestion in Portland, the Port of Portland, container exports, trucks on the road, CARB (California Air Resource Board), LCFS (Low Carbon Fuel Standard), or the upcoming transportation package the Oregon Legislature is going to tackle in the 2017 Legislative Session.

If you are reading this from a state that has transportation figured out – I envy you! Us Oregonians seem to be on the struggle bus these days. (Transportation pun intended!)

I spoke at the Oregon Seed League convention last month and updated everyone on current issues regarding exports, transportation and Port of Portland. In fact, there were two agenda items dealing with transportation and port issues! I told the audience: “I’ll bet you’re looking forward to the day we stop talking about transportation.” It got a few laughs, but I’ll take it. I’m really not that funny.

Unfortunately, this isn’t a laughing matter. Also unfortunate is the amount of misinformation out there when it comes to transportation, trucking, and ports. I’d like to tackle a few of those here.

  1. CONTAINER TRUCKS AREN’T CAUSING CONGESTION IN PORTLAND.

What? I know I know, you’ve been told it’s container trucks, and it seems like it would make sense because of the Port of Portland not having container service at Terminal 6 any longer. But it’s not. Did you know: Only 200 out of 120,000 vehicles are related to containers moving to ports other than the Port of Portland. Trucks aren’t going anywhere they haven’t gone before.

portland-congestion-facts

But but but… congestion! Yes, Portland is awful. And it doesn’t appear to be getting any better. But it’s not trucks. It’s cars. Next time you’re in traffic, take a look around. You notice the trucks because they’re big rigs. But, compare the number of trucks to the vast amount of cars. And how many of those cars are single passenger?

When is Portland the worst? Rush hour. When are container trucks driving to or through Portland? I can guarantee you, it’s not rush hour. If we get caught in rush hour traffic, it’s because something has gone wrong at a terminal somewhere. We leave our plant early enough to miss rush hour in Portland, and we are typically back before rush hour in the afternoon. Does this always work every day? No, but, for the most part, we’re not stuck in rush hour traffic.

What’s the real problem? Traffic congestion increased recently along the Portland metro-area roadways. Vehicle volumes have increased 6.3% over volumes from last year. This increase is nearly twice the national average. The rise in vehicle volumes means that roads are running at or near capacity during the peak hours, commute times are growing longer, and driver frustration is building. Growth on the system is due to new users. The number of out-of-state drivers’ licenses increased to approximately 85,000 in 2015. In addition, a drop in unemployment means more people heading to and from work. Lower gas prices than one year ago also makes it less expensive to travel. (Information from Oregon Department of Transportation)

For more information on what ODOT is doing to help the traffic and congestion problems crippling Portland, click on info-graphs above.

2. IS THERE INCREASED TRUCK TRAFFIC ON I-5 SINCE PORTLAND LOST CONTAINER SERVICE?

trucks-on-road

Short answer, yes, there is increased traffic on the roads. And we are some of those trucks on the road. We also utilize Northwest Container Service (NWCS, a remote container yard) located in Portland. NWCS then rails containers north to the ports of Tacoma and Seattle. We can drop off and pick up containers at NWCS, but they cannot handle all of our volume, and there are increased risks to only using NWCS (namely less ability to have on-time delivery). So, as part of our business strategy to keep our shipments on time and to best service our customers, we deliver to a combination of NWCS, and ports of Tacoma and Seattle. If and when Portland brings back container service, we will use Terminal 6 at Port of Portland. Diversification is a key strategy in being successful in the strange world of international container shipping.

In summary, yes there are more trucks on the road because Terminal 6 at Port of Portland lost container service… but don’t blame the Portland traffic and congestion problems on trucks. These are 2 separate problems that really don’t have anything to do with one another.

I love and appreciate trucks and the truck drivers that deliver 75% of our goods to us. In fact, I think it’s time to thank a trucker. Today and every day. It’s not an easy job, and those that safely do their job day in and day out, you are appreciated. thank-a-trucker-1

If you’d like to learn more about the Port of Portland and why Terminal 6 is different than the rest of the terminals on the West Coast, you can read more here

There’s so much more to talk about in regards to transportation in Oregon! I know, so exciting… but for those of you who are interested, stay tuned for Part 2!

The battle continues… West Coast port crisis not over.

It’s not time to pour the champagne just yet. “Ship” hit the main-stream news fan late last week when Labor Secretary Tom Perez game both sides until Friday to settle the dispute or he would ship them off to DC to continue talks downstream from the White House. All puns intended. When news broke Friday evening that a contract had been tentatively signed, my Twitter blew up. Anyone not completely familiar with how things work thought this was over. Far from it. I know of both Ports of Oakland and Portland have both had skirmishes over the weekend. Apparently Local 10 in Oakland was found guilty of work stoppages. And the Hanjin Copenhagen is yet to sail from Terminal 6 at Port of Portland! That ship has been sitting for 19 days… We have 45 containers sitting on dock still waiting to load. Some of those containers have been there since January 15th. It doesn’t take a rocket scientist to realize that this is hurting the small businessman and farmer alike.

For a timely update aired by the Ag Information Network, see here.

Shippers have a very tough road head of them. Ship lines are trying to clear the backlog at whatever means necessary. We are fighting every day to keep ahead of schedules, getting trucks to port within the very short time-frame we are given – and us Oregonian businesses and farms are now behind the 8-ball because our options just became much more limited with Hanjin announcing they are pulling out of Terminal 6 at the Port of Portland. In one announcement, Port of Portland lost 80% of their containers business.

The complete lack of remorse and total disregard by both the PMA and ILWU for the havoc that ensued during this continuing crisis is repulsive. See very brief press release here. No “thank you for your patience”. No “we’re incredibly sorry for the suffering that America has endeavored.” And definitely no sign of “we will all work together to make sure the West Coast ports become synonymous with the best ports in the world!” Because of this and because of the economic pain and damage, we simply cannot let this happen again. We’re hearing that the contract was for 5 years. The clock is now ticking, the deadline is now set, and our next battle has been named: preventing a small group of people from holding the American economy hostage the next time the contract expires.

Wish us luck.

In the meantime, some comic relief… Here are our new names for a couple of vessels:

ship line just kidding

ship name MEHship line daylateship line almost

Day 29… and counting.

Day 29 of port issues: slow-downs, lack in port production, ILWU walk-offs, truck congestion, and all-over harm to business, agriculture and the economy. The long term repercussions of this are yet to be seen.

Let me clarify. It’s been 29 business days that we have struggled with this. November 3rd was a harsh reality when the first notification from my truck dispatch alerts me to issues. This was the email we received at 7:59am on November 3rd:

“We have been shorted almost all of our labor to work the yard today. The Union Hall has reported that they had “no man power” to fill the requested labor. We will be running at 25% capacity at best today. I would expect turn times to be in the 1-2 hour and if not longer. We would suggest holding off on any cargo that can be delayed until later in the week. We can’t stress enough that today will be extremely slow.”

We had NO idea that this was just the beginning of the chaos that would ensue and still continuing through today.

US Containers_Long Beach

Some background: The contract between the ILWU and the PMA has been negotiated since July 1, 2014. The previous contract expired on June 30, 2014 and both parties began the negotiating process for the new contract in May 2014. I probably don’t have to do the math for you, but we are in our 8th month of negotiations. It’s almost humorous. It is in fact beyond reason that two entities cannot come to an agreement in 8 months. It is beyond reason that because of these failing negotiations, that small business, agriculture commodities and West Coast state’s economies are hurting. It is beyond reason that our government is yet to step in and go up the chain of command and demand the President of the United States to order a Federal Mediator. The last we heard from the White House was mid-November when POTUS said he is “confident the two can come to an agreement.” Well Mr. President, it’s been 8 months. At what point do you step in? How long will you allow our PUBLIC PORTS to be inefficient, costly and unreliable?

Let’s look at what they may be negotiating. From multiple sources, it seems there are 2 items that are at the table: 1) Benefits. Specifically who pays the “Cadillac Tax.” 2) Automation.

1) The Affordable Health Care Act’s “Cadillac Tax” on generous medical plans is projected to cost the industry $150 million a year, according to Mr. James McKenna, CEO and Chairman of the Pacific Maritime Association. Employers (meaning the terminals and shipping lines, but ultimately us all as increases in costs always get passed on…) pay the entire cost of premiums for ILWU medical insurance. According to the PMA website: “The ILWU benefits package includes fully paid health care for workers, retirees and their families with no premiums, no in-network deductibles and 100 percent coverage of basic hospital, medical and surgical benefits. Prescription drugs are covered for $1 per prescription; dental and vision care are provided to workers, retirees and their families at little or no cost.” Employers say that plan is generous enough and, furthermore, they can’t afford to pick up any more expenses in that area. The ILWU does not want to pay for the additional costs. Frankly, I would argue that any red-blooded American would agree with the employers here! According to my source on Capital Hill, the PMA has already given into the ILWU’s demand of paying for the Cadillac Tax. Unbelievable to me. Completely unbelievable. Yet if this is true, then my guess is the ILWU saw the green light and went after more…

2) Automation. At first glance, more automation equals less jobs. Right? Here’s what I don’t understand. ILWU’s rallying call is “An injury to one is an injury to all.” So, the ILWU wants less technology, less automation. But what if it makes things safer? Would you accept it then? Or would you be so stubborn and immovable that you simply won’t listen to the word. If the long-term effect of no automation is business moving away from your ports that you work at, then you’ll lose your jobs anyway. I’ve read many articles and watched video’s of ILWU’s own spokespeople claim that “the boss’s” only focus is profit. See one here. Here’s a newsflash: business needs to make money in order to continue year after year. It’s called profit – and profit isn’t a bad thing. It keeps YOU getting that paycheck. You should be helping your boss make a profit – not be against the idea.

Maybe you noticed the email from above and it’s time-stamp: 7:59am on a Monday morning. Do I think it’s coincidence that this start of a slow-down happened at 7:59am on a Monday morning? About 3 weeks before Black Friday? Almost 2 months before Christmas? Absolutely not. The ILWU is very smart, very powerful, and very strategic. If they were to strike, the President could enact the Taft-Hartley Act. They didn’t. They began a long and calculated work slow-down as a negotiation tactic. And it appears to be working. Eventually they will get their way – and I would prefer it to be tomorrow, not next month.

So, you might be one thinking I am pro-PMA and anti-ILWU. I’m not. PMA? You’ve failed too.

PMA 2013 Annual Report

PMA 2013 Annual Report

President McKenna, I’ve read your 82-page Pacific Maritime Association 2013 Annual Report. You outlined these guiding principles last March when talking about the upcoming contract negotiations:

1) Given the tremendous economic impact (West Coast ports support more than 9 million U.S. jobs) of our industry across the nation, we will act with an awareness that these talks have ripples beyond the docks.

FAIL

2) With competition for discretionary cargo growing stronger every year, we will endeavor to enable West Coast ports to operate efficiently and productively.

FAIL

3) Knowing that a reliable labor force is essential to our ports’ standing, we will seek to deliver dependable labor on behalf of our members.

FAIL

I agree that these are important. I agree that “reliability, efficiency, and productivity will be the keys to success.” And you also say in your report that “…safety efforts led to the lowest level of injuries ever recorded.” Then what’s wrong? Why can’t you make this contract happen? I have to think that there is something inherently wrong here. Labor unions don’t realize that long-term success of the ports means long-term jobs for them. Employers either aren’t listening to the labor unions, or they don’t know how to communicate with them. Until these under-lying issues are rectified, then investment – and looking at the West Coast port’s future as positive – is futile.

The West Coast ports are the gateway of choice for goods sent to and from Asia. We are the most efficient route. Not considering anything else, the shortest route between Point A and Point B is always a straight line. Now when you bring in other variables, that line (or in our case, shipping route) begins to change. In 2002, there was a 10-day coast-wide port shutdown that sparked concerns. Add to this contentious contract negotiations between the Office Clerical Unit and the Harbor Employers Association in 2012, the ILWU Local 8 and the IBEW skirmish over who plugs in and unplugs reefers a few years back, and other regional grapplings have raised questions to the West Coast’s reliability. Was this enough to move cargo away from the West Coast ports? Yes it has.

East Coast/Gulf Ports showing a large increase over the past 6 years.

East Coast/Gulf Ports showing a large increase over the past 6 years.

Do not invest another dime into technology, into automation, into innovation. Not until you two INCREDIBLY POWERFUL entities can learn to talk to one another.  Here’s some advice: PMA, learn to communicate. ILWU, take some business classes. For the sake of us all.

Why this affects you.

The current port crisis isn’t just an Agriculture issue – this is an Oregon issue, a Pacific Northwest issue, an American issue.

Ag picture

We are a couple decades removed from the general public knowing their local farmer, understanding the farmer’s plight, respecting the neighboring farm, and supporting the farm families. We – the general public – have simply become urbanized, and have lost touch with what happens outside the city borders – people have lost touch with what goes on in rural America, and in doing so, what it takes to provide the food on their table, the textiles that make the clothes they wear and the seed that they use to plant their lawns and gardens. Critics of modern production agriculture are pushing the negative idea that we are all “corporate farms”, but the U.S. Department of Agriculture (USDA) reports the vast majority of farms and ranches in the United States are family owned and operated – in fact, 93 percent of the 2.1 million farms in the United States are family owned (http://findourcommonground.com/food-facts/corporate-farms/). There are blogs going around that the wheat we eat is poison. Since when? From the words of my farmer friend Brenda: “I want to tell you a short story about how we check our wheat before harvest to see if it’s ready, and also during harvest to make sure that the moisture is right.  We grab a handful (with our bare hands) and we toss kernels into our mouths and we eat it.  This practice has been done for generations.  My grandpa ate wheat straight from the field, straight from the combine, my dad has, and I do as well.  You would think that if anyone is going to come away from this whole conventional wheat experience with a toxic disease it would be us…but we don’t.  We are all healthy as horses, because what we are growing is safe and healthy.  Now I know as much as anyone that this isn’t scientific, but it does show how much we trust what we are doing out here in the fields.” (For more information on this topic, see: http://nuttygrass.com/ or http://prairiecalifornian.com/truth-toxic-wheat/)

Agriculture is important to us as Oregonians and as Americans. From the words of our Governor Kitzhaber: “Agriculture remains one of Oregon’s economic bright spots, creating about 1 in 10 Oregon jobs, with a $5.4 billion production value equal to roughly 15 percent of the state’s economy. There is tremendous diversity in what we grow, with more than 220 different commodities produced under some of the best growing conditions you’ll ever find. That array of crops, livestock, and fisheries strengthens our agricultural economy, which strengthens all of Oregon. But our agriculture sector is more than numbers, it’s also about what makes this place so special – our open spaces, vistas, greenery, and sustainable natural resources. Those Oregonians who have chosen to raise our food and fiber deserve our gratitude and support, and I ask that all Oregonians join me in thanking them for their incredible contribution to our state.” Well, Governor, you’re welcome.

Teaching the girls how to de-bud hazelnut trees

Teaching the girls how to de-bud hazelnut trees

What does that mean in a nutshell? JOBS. The opportunity for Oregon’s Agriculture and it’s affect on the economy is exciting – if we can allow it to happen. Oregon agriculture has diversified into markets that are growing very fast… These markets offer the potential to revitalize an industry that is slowly being recognized as having an increasing role in Oregon economic future.* Agriculture… having an increasing role in Oregon’s economic future! More jobs, more revenue!

Okay, so we – Agriculture – we’re kind of a big deal. When we really look at it – Oregon’s Agriculture is NECESSARY for the continued strength of the state.

OR Ag important exports

Excerpt from Oregon Department of Agriculture presentation – click on to be linked to blog “Crisis on West Coast Ports”

But if we can’t get it to market, then what good is any of it?

We are on day 13 of a West Coast Port crisis. The hard-working (when they’re working) members of the ILWU at the West Coast Ports are stuck in a negotiation-tactic filled fight with the PMA (Pacific Maritime Association). Until this is resolved and a contract is finally filed, we are at the mercy of the Big Dogs. Our farm is fighting, our company is fighting, our straw-export industry is fighting, the Christmas Tree industry is fighting, the Washington Apple industry is fighting – we’re ALL fighting to stay alive, to continue business, to continue our ever-so-important relationships with our overseas buyers. Some of us might not survive this, and that is sickening.

Governor Kitzhaber, President Obama, members of Congress – you KNOW how important Agriculture is to this state, this country. Our history is filled with the stories of the American Farmer. At some point along the way, the American Farmer became two antithetical people – the adversary (see above in regards to “corporate farms” and “poisoning food”) but also the romanticized and commercialized icon of America.

God made a farmer_tractor

Think 2013 Dodge Ram’s Super Bowl commercial using Paul Harvey’s “So God made a Farmer.” If you haven’t watched the commercials, or read the entire speech – you should (See below for link). It’s amazing, and makes me tear up every time I read it and watch it – because it’s true. Farmers are special people choosing a lifestyle that’s not easy, bringing their family with them into the field, working long hours – all to get their product to market in order to survive another year.

Their product to market… Again, market. I’ve quoted this before, and I’ll quote it again:

“There is nothing that we produce in this country in agriculture, that cannot be sourced somewhere else in the world. We can grow the best in the world, but if we can’t deliver affordably and dependably, the customer will go somewhere else… and may never come back”.

This state, this country, will have a different landscape if we 1- cannot get our product to market and 2- farmers are regarded as anything but supporters of America and caretakers of the land.

“Opportunities and challenges” is perhaps a cliché, yet it is a phrase that certainly fits Oregon agriculture today. Agriculture holds great potential to contribute to the solution, as long as the entrepreneurs and policy makers who recognize agriculture’s role as an economic engine in the past continue to acknowledge its even greater potential for the future.*

We need the support of our neighbors, our state, and our government to continue to provide food, jobs and revenue for the good of us all.

Watch So God Made a Farmer Video: https://www.youtube.com/watch?v=AMpZ0TGjbWE

*http://ruralstudies.oregonstate.edu/sites/default/files/pub/pdf/OregonAgEconomyAnUpdate.pdf

From the White House

“We alerted them that agriculture and forest products, America’s largest and most important export, are in serious peril.”

I’m shocked that this information isn’t on the news – and other than those I’ve talked to about – or maybe some that have read my blog or Facebook posts – the general public has no idea what’s going on. And according to this update, the National Economic Council and the Department of Commerce didn’t know either. I’ve pasted the update from our Executive Director, Peter Friedmann, after he met with some White House leadership. (See end of blog)

Why is this? I’m trying to figure out why the general public doesn’t know or understand. Do I dare believe that the ILWU is so powerful that the media doesn’t dare tick them off? If you want to be shocked about something, read this: http://www.pmanet.org/the-ilwu-workforce. (I’ll be blogging on this subject in the future). In a nutshell: Full-time workers earn an average of $147,000 annually in wages, along with a non-wage benefits package costing more than $82,000 per active worker per year. You better believe they don’t want this information out when they are crying about fair compensation and being blue collar middle-class families. They also don’t want it to get out that they are trying to negotiate to NOT pay the taxes on their Cadillac health care plans. And of course they don’t want automation – to keep our ports competitive – because they want to keep these high paying jobs.

I feel like I’m beginning to sound like a doomsday-er. I truly don’t intend to! Only two things can happen at this point: the PMA can cave into the demands of the ILWU so that they get back to work and stop their negotiating tactics of port slow downs – this option makes it harder to compete on an international level… Or the situation hurts the economy so badly that our US Congress and/or President Obama needs to step in. It’s a lose-lose situation.

I realize that I need to write some background to the labor/contract dispute. I will try to do that soon. Hope this is enough to start getting the general public some knowledge into their economic limbo. I believe that the newspapers and TV will start covering this by the end of the week if this does not begin to improve. Until then, this is all I’ve got to help – one voice.

AgTC: White House Meeting Update

November 12, 2014

The AgTC and other industry groups met with White House leadership of the Domestic Policy Council, National Economic Council, and Department of Commerce to discuss the crippling port disruption on the West Coast. We alerted them that agriculture and forest products, America’s largest and most important export, are in serious peril.

There were a lot of aspects that the White House was completely unaware of– they didn’t know how much cargo is being left at the docks or is not able to be moved at all. We were very concerned at how little the White House knew about the situation at the West Coast ports and the impact on the nation’s economy. We made sure that they know now.

The White House said they were monitoring the situation, and we strongly emphasized that monitoring is insufficient. We urged the Administration to take firm action such as bringing in a federal mediator, as was the case in previous instances of labor-management disputes. We told them that we are weighing in with our Congressional delegations and that they will be hearing from Members of Congress.

In the meantime, we will continue to reach out to the press, because we believe the White House will respond immediately to the glare that is cast upon the White House by the press inquiries. We need to stimulate more of those press inquiries, and that is what we will continue to do.

Hi my name’s Shelly, and I’m an advocate.

I really wish that my second blog post could have dealt with sunshine and lollipops – maybe some cute kid pictures, some “Hello from the farm Friday” pictures.

Unfortunately, I’m diving head-on into something a little bigger than lollipops…  Oregon’s and America’s economy. Yikes, I know.

Port of Seattle

This is the line of trucks on Wednesday trying to get into the Port of Seattle. Port of Tacoma looks like this too… We are on DAY 5 of not being able to turn in containers into Port of Tacoma. To make a terribly complicated and long story short… we are one step away from the West Coast Ports – including Los Angeles and Long Beach – being completely shut down. 65% of America’s imports come through the Ports of LA and LB. The threat to America’s economy is estimated at $2 BILLION each DAY there is a shut down. Immediate action is necessary at the federal government level. Letters from the largest organizations and businesses in the country are urging President Obama to do something!

So, what can I do? It seems like nothing. But I’m constantly reminded that one person CAN do something – and so I am. I’m spending way too much time of my working day writing my state congress men and women, and our newly re-elected Governor Kitzhaber. I’ve written to Oregon’s representation in the US Congress. I’ve contacted Oregon Trucking Association. Our export groups are writing letters and contacting Congress. It takes hours to do this – hours I need to spend working, to minimizing costs to our business, to help with dispatching trucks and making decisions on what to do in the midst of this crisis, all to try and keep our customer’s schedules on time as much as possible. It currently is impossible to do so – there are millions of dollars of product being imported and exported that are currently sitting on docks on all the West Coast Ports, simply not moving.

My guess is that most of the public doesn’t care – and not in a negative sense! They just don’t know! But, every time something happens in the world of transportation, it will affect the consumer – typically in either higher costs, or product not getting to market. Think of it in terms of your favorite local coffee shop… those coffee beans are sitting in containers in port, or maybe not unloaded off the ship in Seattle. And all of a sudden the costs of those containers sitting at port adds up, and someone has to pay for it! Guess who ends up paying? That’s right – you and I.

And I care deeply for all of the reasons above, but what I most care about is Oregon and it’s wonderful AGRICULTURE. And guess what happens if this problem doesn’t eventually get fixed and fixed quickly… we lose our international customers. Consider the wise statement upon which the Agriculture Transportation Coalition was organized:

“There is nothing that we produce in this country in agriculture, that cannot be sourced somewhere else in the world. We can grow the best in the world, but if we can’t deliver affordably and dependably, the customer will go somewhere else… and may never come back”.

What happens if our customers around the world choose their Agricultural products elsewhere? This home that we call Oregon begins looking a lot different. We as a state can produce the finest agricultural products available – but if we can’t get those products to market, then we all suffer, including our next generation. Here’s my next generation – and this way I can tone this blog down with cute kids picture!

My girls

Here’s hoping that tomorrow is truly a new day for us!