US West Coast ports face $5 billion worth of delays

Port of Long Beach, Shipping Cranes

Strike disruptions across major US West Coast ports have led to a “significant surge” in container backlogs, according to maritime analytics provider MarineTraffic.

The week following 5 June witnessed an increase in the average number of containers waiting outside the port limits at the Port of Oakland, rising from 25,266 to 35,153.

According to CNBC, a MarineTraffic spokeswoman further revealed that a more dramatic rise from the Port of Los Angeles and Long Beach in the same week where the average TEU waiting off port limits rose from 21,297 to 51,228.   

The combined value of the 86,381 container boxes stalled across West Coast ports has reached approximately $5.2 billion, reported CNBC.

In a recent letter to the Biden Administration, the US Chamber of Commerce cautioned about the potential financial consequences of a “serious work stoppage” at West Coast ports, estimating a daily cost of $1 billion to the US economy.

The Chamber further implored the President to appoint an “independent mediator” to expedite negotiations and to facilitate a resolution between the Pacific Maritime Association (PMA) and the International Longshore and Warehouse Union (ILWU).

While the White House has quelled all concerted attempts from shipping carriers and associations to intervene in the negotiations, the Biden Administration has deployed acting Labor Secretary, Julie Su, to oversee any contractual developments.

Much to the dismay of shipping liners, the White House intends to respect the collective bargaining process and has refrained from imposing any invasive level of influence, remaining, at large, non-partisan to the disputes.

Julie Su’s deployment, however, is certainly an escalation in Government involvement, though it should be noted that her role is merely to encourage the PMA and ILWU “to stay at the table and reach an agreement,” said Julie McClain Downey, Assistant Labor Secretary for Public Affairs.

In other words, the government’s intent is not to influence an agreement, but rather that an agreement of any kind is achieved.

Su’s involvement was welcomed by the Retail Industry Leaders Association, who later shared in a group statement: “We urge Acting Labor Secretary Su to stay engaged until a resolution is reached that ensures the uninterrupted flow of goods and restores confidence in the West Coast ports as a reliable gateway for global commerce.” 

READ: Shipping companies feel impact of US West Coast strikes

According to logistics managers familiar with the situation, the slowdown in work shifts and overall absences can be attributed to dissatisfied skilled labourers, CNBC reported.  

CNBC has further shared that requests for additional work at specific port terminals, that are made through official work orders, are not being posted on the union hall’s wall for fulfillment.

Additionally, the PMA is denied access to the union hall, preventing them from verifying whether the terminal orders are being requested as intended.  

In a statement regarding the series of disruptions suffered between 2 June and 7 June at the Ports of Los Angeles and Long Beach, the PMA accused the ILWU of refusing to dispatch lashers for when vessels arrive and depart.  

“Without this vital function, ships sit idle and cannot be loaded or unloaded, leaving American exports sitting at the docks unable to reach their destination,” the statement read.

The PMA further professed that such oversights were part of a concerted and organised effort, by the ILWU, to further unsettle port operations, and to “withhold necessary labour from the docks.”

READ: Pressure mounts on White House as US West Coast strikes persist

After the Port of Seattle became the latest to be afflicted with strikes more recently, the PMA credited the actions of the ILWU for the supply chain issues and transshipment delays the West Coast has suffered.

According to the PMA: “For months, the ILWU has staged disruptive work actions targeting the West Coast’s largest ports.

“These actions have either slowed operations or shut them down altogether, impeding the supply chain and leaving ships and the American exports they carry sitting idle at the docks.”

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