Reps. John Garamendi, D-Calif., and Dusty Johnson, R-S.D., today introduced legislation to stop shipping companies from denying U.S. exporters the ability to get their commodities overseas as well as protect against excessive port fees.
Spurred by reports of Chinese exporters paying shippers extra to return containers empty and leave U.S. rice, almonds, walnuts, wine, pork and other goods waiting at Western ports, the lawmakers unveiled the Ocean Shipping Reform Act of 2021, a bill they say has plenty of support in both houses of Congress.
The legislation would prohibit shipping companies “from unreasonably declining export cargo bookings if the cargo can be loaded in a safe and timely manner,” according to a summary of the bill.
Chinese exporters sending everything from shoes to televisions to the U.S. can afford to pay far more for a container on a ship heading to the U.S. than American rice farmers can pay to send a container to Asia, so the vessel-operating common carriers, or VOCCs for short, tend to favor the Chinese companies, say lawmakers and farm groups.
On top of that, Chinese exporters are often willing to pay more to expedite the return trip of ships, which means not waiting for the ships to load containers of U.S. farm goods that need to get to Asia.
Garamendi and Johnson say their bill would prevent that from happening.
“This is a major issue for ag producers in the middle of the country,” said Johnson, who stressed concern that U.S. pork exporters will have to freeze their product because of the delays at ports. That he said, would have a major impact on the price that U.S. sellers get from customers who prefer chilled product.
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“Foreign businesses’ access to the American market and its consumers is a privilege, not a right,” said Garamendi. “California’s agricultural exporters and other businesses are willing to pay to ensure that American-made products reach key markets in the Asia-Pacific. In turn, companies looking to offload foreign-made products at West Coast ports must provide opportunities for American exports. Even during a global pandemic, trade must be mutually beneficial, and that is exactly what our bipartisan bill ensures.”
The Ocean Shipping Reform Act of 2021 doesn’t just have backing on Capitol Hill. More than 100 ag groups and companies have signed on to a letter penned by the Agriculture Transportation Coalition, expressing support for the bill.
AgTC calculates that about 22% of U.S. ag export sales can’t be completed because of the shipping problems.
“Ocean carriers are declining to carry our cargo in favor of returning so many containers back to Asia empty, while unprecedented freight rate hikes, penalty charges, and unpredictable service are denying affordable, dependable US agriculture export access to our best foreign markets,” said AgTC Executive Director Peter Friedmann.
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