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January 26, 2015
West Coast Port Update
There are several challenges affecting the Ocean Freight Industry on the US West Coast. As most of you are aware, the International Longshore and Warehouse Union (ILWU) have been working with the West Coast ports since early July without a contract. After nine months of negotiations, a Federal Mediation Conciliation Services official was called in on January 5, with high hopes that the agency practiced in bringing warring sides to the table would achieve a settlement.

Shipping lines and terminal operators, who are represented by the Pacific Maritime Association (PMA), can no longer afford the increased operating costs that result from work slowdowns by the ILWU. Standard vessels should be discharged and loaded in no more than three days; currently vessels are taking 2-3 times as long to work. Carriers are suffering and sustaining losses due to the extreme congestion they are facing at the port.

Steam lines measure the amount of containers they can transport on each ship in TEU’s, which stands for Twenty-foot Equivalent Unit. There are currently 18 vessels waiting to enter the port, which equates to approximately 210,000 TEU’s that are waiting to be unloaded. Carriers incur an additional $50,000 each day that their vessels are idle.

On January 12, the PMA stated in a release that “The ILWU slowdowns and the resulting operational environment are no longer sustainable. The PMA has alerted the local port authorities to the deteriorating situation on the docks.” The clear implication of this statement is that terminals are approaching complete gridlock. A lockout would be undesirable to all parties involved, yet it appears to be heading in that direction. The inevitable Taft-Hartley injunction that would follow would only prolong the agony because the work slowdowns would most likely continue.
Until the ILWU and PMA reach a contractual agreement, it is certain that your prices will be impacted as surcharges are assessed by the carriers to recoup these increased costs.

We will keep you updated on further developments.

If you need additional information or assistance on technical issues concerning Sempermed gloves, please contact our Customer Service representatives at 800-366-9545.