Over just five months last year, port congestion led to a 17% decline in agricultural exports that amounted to $2.1 billion in lost sales, according to new research led by UC Davis economist Carter Colin. It far surpassed the losses suffered from a trade war with China, which amounted to about $500 million.
By September, nearly 80% of containers left California ports empty. The number of containers filled with farm products dropped by 25,000 between May and September of 2021.
In years past, U.S. agriculture would typically fill over 40% of all loaded shipping containers leaving California ports, and about one-third of those containers carried California farm products. Tree nuts lost about $520 million, wine more than $250 million and rice about $120 million, according to the UC Davis research.
“The overall level of tree nut exports is lagging substantially behind the pre-congestion levels, including the 2018 or 2019 harvest-season export volumes, which points towards very significant export losses for this sector of California agriculture.”
The economists point out that the impact goes far beyond sales, since the supply chain crisis portrayed California ports as less efficient even than those in East Africa and Russia.
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According to the World Bank’s Container Port Performance Index, California ports rank near the bottom in terms of global port performance. Out of 351 total ports, the latest figures rank Los Angeles at 337, Long Beach at 341, and Oakland at 334 - far behind most ports in developing countries and those on the Atlantic Seaboard, the researchers noted before concluding: “The recent performance of California ports has been abysmal.”
“If port inefficiencies persist, the ramifications for California agriculture will extend beyond the immediate loss of foreign sales, as importers begin to view California as an unreliable supplier of agricultural products,” Carter noted.
The competitiveness of California agriculture in the world market is now being threatened by inadequate transportation infrastructure, the researchers explained. "We should have seen this coming."
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