WASHINGTON, Aug. 5, 2016 - West Coast union dockworkers will vote next week on whether or not they’re willing to discuss an early extension of their contracts, a development that would be very welcomed by agriculture exporters.
If the International Longshore and Warehouse Union (ILWU) votes yes during a three-day meeting in San Francisco from Aug. 10 - 12, then members will begin a lengthy process to discuss details to extend the contracts beyond the current July 1, 2019, expiration date, Russ Bargmann, an ILWU director, said Friday.
It’s a process that agricultural exporters will be watching closely after a nine-month contract dispute between the ILWU and the Pacific Maritime Association (PMA), a group that manages West Coast Ports, resulted in massive slowdowns that effectively halted trade in late 2014 through early 2015.
A spokesman for PMA declined to comment for this story.
“We are encouraged by this development and strongly support any step that will result in a more long-term contract between the two parties,” said Mike Steenhoek, executive director of the Soy Transportation Coalition. “Such a contract extension will provide greater predictability of the supply chain for those industries, including agriculture, that depend upon West Coast ports.”
Bulk shipments of agricultural commodities like soybeans and corn were mostly unaffected, but exporters of containers full of meat, fruit, vegetables, hay and other commodities were hit hard and lost billions of dollars.
Chilled meat exports to Asia were hit especially hard because of the labor dispute, said Joe Schuele, a spokesman for the U.S. Meat Export Federation. Frozen product is able to be stored in the ports for several weeks, he said, but chilled cuts have a much shorter shelf life. To prevent crates of rotting meat piling up at the ports in California and Washington, the product had to be diverted elsewhere – often sold back into the domestic market at a significant loss to the exporter.
Exporters ship about 200,000 metric tons of meat worth about $700 million to Asian markets through West Coast ports, according to data from the North American Meat Institute.
Schuele said exports of chilled beef and pork dropped by 18 percent in the first quarter of 2015, but some of that decrease was likely due to other market conditions.
Still, the entire industry felt the pain from the dispute that didn’t end until February, 2015.
“It also had an impact on prices, all the way back to the farm level because you start to see these swollen cold storage inventories,” Schuele said. “When those inventories start to get high, you start to see an impact on livestock prices.”
There is no telling which way the ILWU will vote next week, but the Agriculture Transportation Coalition quoted PMA President Jim McKenna in a June article, saying he was “hopeful” that the union would agree to talks on an early contract extension.
McKenna was quoted saying: “The logical thing is an extension of the contract for three to five years.”
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