Shippers, especially those in the business of importing and exporting perishable goods, were scrambling for alternative transport Friday with no imminent sign of an end to the West Coast port shutdown that has choked off trade between the United States and Asia.
"We're already in a crisis," said James McCranie, executive vice president of marketing at Seald-Sweet, a citrus growers' cooperative in Vero Beach, Fla.
McCranie said the co-op had at least 30 containers trapped at West Coast terminals, the first shipment of a crop of grapefruit headed for Japan. The fruit, which is carried in refrigerated containers that have no independent power source, will quickly rot if not handled properly. "The problem is you have no confidence that your cargo is being properly refrigerated and there's no way to divert it," McCranie said. "It's perfectly fine fruit and could be sold in Washington or Oregon.
He complained that shipping lines were not able to give any information about where the cargo was and in what condition. "For a perishable, it couldn't be worse."
The U.S. citrus industry exports 11.3 million cartons of grapefruit to Japan annually, about 50 percent of it in containers at 1,000 cartons to a container.
"The effect is mounting with each day," said Claire Smith, spokeswoman for Sunkist Growers Inc., another citrus cooperative in Van Nuys, Calif. Although the co-op has only a dozen or so containers tangled up in the labor dispute, exports have ground to a halt.
"Our export market is a very large market so it's preventing our growers from earning their livelihood. It's more a question of losing money by missing the market," Smith said.
While the market for orange exports is in between the peak of summer Valencias and the winter navel varieties, Smith said, "We figure we're going to be losing about $1-2 million a week, and the longer it goes on the higher it will be because then we're getting into the major shipping season."
Resentment, too, was on the rise among frustrated shippers.
"The union is not negotiating, it's grand-standing," said Hud Warren, transportation manager for Herbalife, in Carson, Calif., an exporter of beauty products and dietary supplements. "It seems that all management wants to do is automate but still protect jobs, so this is not about jobs. I look out on my way to work and see 40 ships at anchor hemorrhaging money and I think it's just irresponsible."
Warren managed to stockpile three months' worth of goods before the dispute flared into a lockout. "If it were to drag on for a month, I think that would be critical for us. But it hits critical mass for others much sooner than that," Warren said.
McCranie said he would welcome greater efficiencies in the ports. "Most people I've talked to are kind of shocked at the salary levels they're talking about. It's not the norm," McCranie said. "It's staggering to think about it, when a man working all day picking fruit or on a packing line makes $800 a month. You're certainly not going to draw any sympathies from around here."
Shippers were considering other options, including alternative ports like Ensanada in the Baja California region of Mexico, which could handle bulk shipments of fruit but not large container vessels. Shippers and their customers abroad were also putting pressure on the U.S. government and the Pacific Maritime Association to resolve the dispute quickly.
"We just are doing anything as aggressively as possible to get things back to normal," said Smith.
McCranie agreed. "We just hope there will be some relaxation and we can get the perishable commodities out of there," he said.
Bill Ciesinski, manager of transportation and logistics at International Forest Products in Foxboro, Mass. said that the lock-out had brought some of his business to a halt.
IFP had begun to load 6,000 metric tons of woodpulp aboard a ship in Eureka, Calif. just prior to the port shutdown. Ciesinski said his company was paying detention for the ship, hoping for a quick resolution of the dispute. "I'm holding the ship there because if I don't load it, I have to wait another month," he said.
He also has had shipments of waste papers delayed.
"It's jeopardizing letters of credits and if it is not settled by Sunday, we are going to lose a significant number of orders," he said.
Cargo must be loaded by a certain day for letters of credit to be in force, he explained. If those dates pass, he will have to renegotiate the terms of sales. And he doesn't think the strike will create product shortages in Asia and drive up prices.
"We specialize in commodities, and the way the market is going, prices have been dropping."
Ciesinski says he is increasing the amount of cargo he is shipping through Gulf and East Coast ports, but says "I'm not overreacting. I'm taking it day-by-day and hoping they will come up with a settlement.
The New United Motor Manufacturing Inc. plant in Fremont, Calif., which closed an auto assembly line on Wednesday and a truck assembly line on Thursday, is hoping to re-open car production as soon as Monday by shipping eight containerloads of parts by air.
Spokesman Michael Damer says the plant, which is located about 20 miles south of Oakland, normally uses the port as a storage area for parts, moving about 26 containers each day for trucks and eight for cars.
The company had planned for a possible port shutdown and was building up an inventory of about a week's worth of parts. But because of dockworker slowdowns prior to the lock-out, inventory never got built to the level the company wanted, and the plant had to shut down.