Senate work session examines economic impact of slowdown at ports

TradeCaptureBROWNA joint work session held this morning by the Senate Trade and Economic Development and Commerce and Labor committees took a detailed look at the reduction of trade volume at 28 West Coast ports that is crippling Washington’s agricultural community and other trade-dependent businesses.

“Washington ports have been losing market share, and it is critical that we as lawmakers take a comprehensive look at the reasons for this slowdown and what we can do reverse that trend,” said state Sen. Sharon Brown, chair of the Trade and Economic Development Committee. “Fewer ships moving through Washington ports means higher cost for Washington businesses and farmers who need to ship their goods to international markets.”

Cargo has been moving at half-speed since October as contract talks continue between the International Longshore and Warehouse Union and the Pacific Maritime Association, which represents ports and shipping firms. The union’s master contract with Pacific ports expired June 30. Last week both sides requested the assistance of a federal mediator.

“There has been a significant reduction in port volume as a result of the ongoing dispute between the ILWU and Pacific Maritime,” said Eric Schinfeld, president of the Washington Council on International Trade.

“We are seeing a slowdown as a result of the failure to get a contract – that is a direct cause. We’re seeing hundreds of millions of dollars in lost activities for Washington state.  We have customers from across the world who are making the decision to go through other ports…we have months and months of backups so this is a problem that we will be feeling the effects of long after relations improve.”

Schinfeld pointed out that 40 percent of the jobs in Washington are tied to trade.

“So when you have businesses that can’t get their goods to market in a timely way, it impacts everyone,” he said.

Hardest hit by the slowdown is Washington’s agricultural community. Marc Spears, export sales manager at Chelan Fresh Marketing, discussed the impact on growers.

“We are losing 1.2 million dollars per week in economic activity and other growers are experiencing similar loses,” Spears said. “These sales do not come back. Growers have already paid for all the fixed costs…and we can’t forget that these are perishable items.

“This has an impact on jobs. We have a hundred full-time employees in packing and shipping; nearly forty percent of these could be laid off if we don’t expedite shipping.”

Mike Dodd of Basic American Foods, which specializes in prepared potatoes, chili, and beans for the foodservice industry, summed up the fears of many of those who testified: “If we lose these markets, we may never get them back.”

While most of those who testified pointed to the labor dispute as the cause of the disruption in trade, union representatives pointed to other concerns.

“The permitting process in this state must be streamlined,” said Dan McKisson, president of the ILWU Puget Sound District Council. “Discretionary cargo is moving through Canada, and this is a long-term trend.”

McKisson also identified the need for greater state investment in transportation infrastructure as a key factor in the slowdown.

“From listening to those who testified today, there is no doubt that this ongoing dispute and the resulting slowdown at our ports it is creating is having a devastating impact on our economy and jobs, especially for our agricultural community in central and eastern Washington,” said Brown, R-Kennewick. “While it is not our role as lawmakers to intervene or pick sides in this dispute, I believe it is crucial that we do everything in our power to encourage both sides to come to terms and resolve this matter as quickly as possible.  This is affecting our neighbors, our families and our friends all across the state.  It is an issue that is real and must get resolved.

“Ours is the most trade-dependent state in the nation, and our ports must operate effectively and efficiently.”