US West Coast Port Contract Talks & Congestions - Update

The contract between the International Longshore and Warehouse Union (ILWU) and the Pacific Maritime Association (PMA) expired on July 1 without a new contract or contract extension in place. Both parties have continuously worked through the extended contract negotiations and on August 26th the parties reached a tentative agreement on medical benefits (a top concern at the beginning of negotiations). However, technology advancements and ILWU work jurisdiction still remain important items that have not been agreed upon even though the parties are meeting daily.

As a result, port congestion at West Coast ports has gone from bad to worse. The PMA accuses the ILWU of work slowdowns; the ILWU states that productivity is down due to congestion and safety concerns. A shortage of available chassis, high volume due to holiday season, and a truck capacity crunch, are all important contributors to port congestion.
Most recently, the issue has reached the White House; where shippers are pleading with President Obama to send a federal mediator. The White House feels that through collective bargaining, both parties will be able to resolve their differences and at this time will not provide federal help. Six Senators from California, Oregon, and Washington sent a letter to ILWU and PMA urging both parties to maintain negotiations in good faith.

Currently the following is affecting shippers and ultimately consumers alike:

• Multiple ships are anchored along the U.S. West Coast ports, pending labor to offload and load containers
• Many steamship lines have stopped accepting outbound container bookings and others are cancelling existing outbound bookings
• Potential port surcharges have been mentioned by some parties

Contract discussions aside, this current crisis of congestion was born months and years ago when carriers changed their chassis pools, overwhelmed ports with new massive vessels, and ignored conditions spawning a shortage of drayage drivers. These underlying but very important items will unfortunately not be solved by a contract agreement. Allyn international will keep monitoring the situation and send updates.

How can we help you?

As logistics service providers, Allyn is prepared to seek options to help minimize the impact this will have on our clients and their customers.  If this could be a challenge for you as well, contact the Allyn Logistics Sourcing Group (AllynLogistcsConsulting@allynintl.com) for assistance related to the West Ports situation and any other transport needs.

Contributor: Cleve George

Articles Cited

1. Obama confident ILWU-PMA can reach a deal; http://www.joc.com/regulation-policy/transportation-policy/us-transportation-policy/obama-won%E2%80%99t-wade-ilwu-pma-contract-talks_20141119.html
2. US West Coast ports hit a rut with freight moving slowly but few signs of change;;http://www.joc.com/port-news/us-ports/port-los-angeles/us-west-coast-ports-hit-rut-freight-moving-slowly-no-sign-pick_20141118.html
3. Longshore Union Slowdowns Continue in Advance of Critical Holiday Shopping Season; http://www.pmanet.org/wp-content/uploads/2014/11/PMA-Update-Statement-11-13-2014.pdf