U.S. exporters of agricultural products say uncertainty surrounding the International Longshoremen’s Association Sept. 30 contract expiration is already slowing production and deliveries.
The Agriculture Transportation Coalition discussed the impact of a possible labor disruption in a statement accompanied by AgTC members’ statements about how a port shutdown would affect them.
Related webcast, to be presented on Sept. 12: The Industries Driving U.S. Trade - Agriculture
AgTC noted that several container ship lines have announced congestion surcharges of $1,000 per container or more that will take effect for all U.S. ports if East and Gulf Coast ports are closed by a labor dispute.
The coalition said the surcharges could price U.S. agricultural exports out of the market, and that even the prospect of surcharges is “already causing agriculture producers to slow production if they can, to hold back on export commitments. So the economic injury has already begun.”
AgTC said it hopes the Federal Mediation and Conciliation Service will be able to help the ILA and the United States Maritime Alliance forge a contract agreement. Negotiations will resume next week under FMCS auspices.
The impact of the last major U.S. port shutdown, a lockout of West Coast dockworkers in 2002, was felt by agricultural exporters for years, AgTC said. It cited Japanese confectioners who turned to Turkey and other countries when California nuts and raisins were unavailable.
“The fact that the U.S. ag producer was not at fault, that it was a labor dispute, doesn’t always convince the foreign customer to return to us,” AgTC said. “So, once a por shuts down, the economic injury to the U.S. producer lingers long after the ports get back to work.”
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