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Latest News - February 2015

February 13, 2015
Farmers hit hard by labor strife at West Coast ports
Source: REUTERS
By: STEVE GORMAN

Protracted labor strife and shipping disruptions at West Coast ports have hit farmers especially hard, posing a major barrier to perishable goods headed to overseas markets and resulting in losses estimated at hundreds of millions of dollars a week.

Foreign Pacific Rim customers facing chronic delays in shipments of U.S. food and farm products are turning to other countries for produce ranging from citrus and apples to beef and pork, the Washington-based Agriculture Transportation Coalition (AGTC) has reported.

Many frustrated U.S. suppliers are deciding to forgo exports and scrambling instead to find domestic buyers for their produce, driving down prices, said Wendy Fink-Weber, a spokeswoman for the Western Growers trade organization.

Industry experts say the longer term concern is that American export business lost to other countries, and other ports, may not return once the U.S. West Coast crisis is over.

"They're losing their buyers and they're losing their markets," Fink-Weber said.

Precise figures on the extent of damage are hard to come by. The AGTC has estimated that total U.S. agricultural export losses - for fruits, vegetables and meats shipped by container - were running roughly $400 million a week in December, the latest month for which industry data was available.

Because the dislocation at the ports directly involves containerized cargo only, bulk shipments of grain and soybeans have largely been unaffected, the group said.

HEIGHT OF CITRUS EXPORTS HIT

Mounting waterfront cargo congestion and partial shutdown of the 29 ports last weekend and again on Thursday come as the California citrus industry reached its season of peak demand for exports of navel oranges and lemons to Asian countries.

California growers typically export a quarter of their annual $500 million citrus crop to markets in Asia, Australia and New Zealand. But bottlenecks at the West Coast ports have reduced that by about 25 percent, or roughly $125 million, since October, according to the trade group California Citrus Mutual.

The head of overseas marketing for one major citrus grower, LoBue Bros Inc. of Lindsay, California, in the Central Valley heartland, said his company's exports are off by about half.

The company normally gets 60 to 80 loads of citrus - 40,000 pounds of fruit per load - shipped overseas each week this time of year, but "right now I'm having trouble getting 20 out," co-owner Joe LoBue told Reuters. "In 40 years, I haven't seen it quite this bad."

Industry officials said they expect losses to grow as the port slowdowns go on.

"Fruit is rotting on the docks, sales are being canceled by the customer, and our industry has slowed its harvesting so as not to place matured fruit into the market place," Citrus Mutual President Noel Nelsen said in a statement.

Although some shipments arrive at warehouses and ports in refrigerated containers, "we're not sure the containers are being stored in places where they have power, or that they're getting plugged in," said Dusty Ferrence, director of growers services for the agency.

In January alone, cherry growers in Oregon reported lost export sales of $250,000 directly related to disruptions at the West Coast ports, according to the AGTC.

On Friday, more than 200 Washington state agriculture and forest products companies and organizations delivered a letter to their state congressional delegation urging their help in pressing the two sides in the labor dispute to quickly settle the dispute.

The International Longshore and Warehouse Union, representing 20,000 dock workers, has been negotiating for nine months on a new labor contract with the Pacific Maritime Association, the bargaining agent for shippers and terminal operators at the 29 ports.

 

 

 


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