West Coast Port Congestion Update: Federal Mediator to Battle the Stalemate

Back in November, we filled you in on the port congestion happening on the West Coast due to disputes between dockworkers and their management. We’d like to give a quick update on the situation as we move into 2015.

What’s changed since November?

The short answer: not much has changed, in terms of the slowdowns. Longshoremen are still halting productivity and employers are still not budging on their contract conditions. However, measures have recently been taken to improve the situation.

At first, President Obama said that the federal government would stay out of the argument and let “nature run its course.” In other words, let the dockworkers and their employers come to their own terms in order to keep the ports running productively.

Unfortunately, an agreement still hasn’t been made and it’s been over six months since contracts for the dockworkers have run out. Ships are still lining up at sea to get unloaded at the ports, longshoremen are still stalling unloading trucks, the workers’ union is still accusing management of being the source of all the issues, and productivity has taken a major hit.

This has prompted the federal government to finally get involved. A federal mediator has been employed to get each side to come to agreeable terms. This recent stride by the government won’t necessarily end all of the chaos, but it could be a major step in the right direction.

What’s next?

The federal mediator is there to address both sides of the issue and come up with a diplomatic approach that satisfies both sides of the fence. This could take some time.

Employers are warning that if an agreement isn’t made soon, the major ports at Long Beach and Los Angeles could be facing a gridlock. At this time, the only common grounds that have been established are regarding health care and pay guarantees. The main issues left unapproved are union jurisdiction, automation, pensions and salary.

The silver lining to the big disagreement on the coast is that imports are still expected to rise this year, according to the National Retail Federation. The data shows that import volumes on the West Coast were the highest since 2009, despite all of the issues and conflicts on the docks. January’s imports are expected to be up 1.1 percent from January 2014.

This is good news for the economy, even if there are hurdles to getting the freight shipped across the USA once it arrives at the port.

What does this mean for my supply chain?

This means that your shipments coming into West Coast ports will likely still be delayed until a solution has been agreed upon, but keep in mind that imports are not being completely halted. Ships are still coming in, just at a slower pace.

Trinity is still keeping up to date on these matters to ensure that we are offering the most competitive shipping rates and timelines. Be sure to keep up with these updates as they emerge on our blog as well as with your sales representative.  

Sources:

US West Coast Ports on Brink of Gridlock, Employers Warn, LLoyd's List