Milling & Baking News - April 6, 2021 - 9

Export and Trade Issues

Western port container loading,
unloading congestion easing, slowly
Continued from Page 1

these workforce problems will abate as
more workers are vaccinated.
Some US ports have never been busier.
The Port of Los Angeles, the largest container port in North America, was experiencing record volume. The port processed
799,315 containers, 20-foot equivalent
units (TEUs), in February, a 47% jump
compared with February 2020. It was the
seventh consecutive month of year-overyear increases in volume and the strongest
February in the port's 114-year history.
" One year ago, global trade slowed to
a crawl as the COVID-19 pandemic first
hit China and then spread worldwide, "
Gene Seroka, executive director, Port of
Los Angeles, said in a March 16 press
briefing. " Today, we are in the seventh
month of an unparalleled import surge,
driven by unprecedented demands by
American consumers. "
Mr. Seroka noted in February 2021 loaded container imports at the Port of Los
Angeles reached 412,884 TEUs, up 53%
from 270,025 TEUs in February 2020. But
loaded container exports totaled 101,208
TEUs, down 25% from 134,469 TEUs in
February 2020.
At the same time, the dispatch of empty containers, heavily in demand in Asia,
from the Port of Los Angeles surged 104%
compared with February 2020, reaching
285,223 TEUs.
For importers, frustration and delays
stem from the sheer number of container
ships that must be unloaded and the time
a container must wait on a dock tarmac
or in a port warehouse before it is picked
up for delivery to inland warehouses and
points beyond.
Mr. Seroka in a March 30 interview with
CNBC said, " The time it takes for the importer to pick up their cargo at the port is
now more than four days, but it's off its
high of five days sitting under dwell. "
He reported some progress in other
metrics as well.
" Truck times - the amount of time
that it takes a trucker to move in and out
of the port to drop off and pick up containers - has decreased to 77 minutes
from 88 back in December, " Mr. Seroka
said. " So, we're starting to see some of the
trending in the right direction. "
To accelerate improvement, Mr. Seroka
emphasized the importance of getting the
entire port workforce vaccinated.
" There are more than 100,000 folks
who come to work here at the port complex every day, " he explained. " We've
made significant strides (in vaccinating)
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with our dock workers and longshore
members, but we still have a lot of work
ahead of us with respect to truck drivers,
warehouse workers and others. "
Mr. Seroka also said it was important
for importers to pick up their cargoes as
quickly as they can.
" We can then increase fluidity much
more quickly, " he said. " Our tarmacs are
about 90% full, and in our industry, 80%
is considered full capacity. "
For agricultural product exporters, the
greatest frustration in recent months has

US agricultural shippers are treated fairly by ocean carriers.
The Agriculture Transportation Coalition
and 70 other food and agriculture organizations, in a Feb. 24 letter to President Joe
Biden and copied to Secretary of Agriculture Tom Vilsack; Secretary of Transportation Peter Buttigieg; Michael Khouri, chairman of the Federal Maritime Commission
(FMC), and Cecilia Rouse, chairwoman of
the Council of Economic Advisers, said,
" According to their own public records, the
ocean carriers are enjoying their most profitable period in decades by controlling capacity and charging unprecedented freight
rates, imposing draconian fees on our
exporters and importers, and frequently

February container counts
Percent
February
2021
2020
Change change
Loaded imports
412,884.25
270,025.05
142,859.20
52.9%
Loaded exports
101,208.15
134,468.50
-33,260.35
-24.7%
Total loaded
514,092.40
404,493.55
109,598.85
27.1%
Total empty
285,223.00
139,543.75
145,679.25
104.4%
Total
799,315.40 544,037.30 255,278.10 46.9%
Calendar year 2021
1,634,831.60
1,350,181.05
284,650.55
21.1%
Fiscal year 2020-21
7,086,339.05
6,149,174.90
937,164.15
15.2%
Source: Port of Los Angeles

been the difficulty in securing containers,
which increasingly have been shipped
back across the Pacific empty.
In a recent interview with DC Velocity,
Peter Friedmann, executive director, Agricultural Transportation Coalition, explained that ocean carriers consider the
revenue they stand to receive on cargo
shipped from Asia to the United States
when deciding whether to have containers
returned empty. Asian exporters of goods
to the United States pay $6,000, $8,000,
$10,000, and in some cases up to $14,000
in freight rates for a container going to the
United States, Mr. Friedmann said.
" US agriculture exporters have to
compete with producers from all over the
world, " Mr. Friedmann continued. " We
cannot afford to pay those kinds of freight
rates. The value of the cargo in those export containers (agricultural cargoes destined for Asia) is not that high. Therefore,
the export revenue that the ocean carriers get for carrying the cargo westbound
to Asia is more like $400, $800, or maybe
$1,400 to $2,000 on the high end. So, ocean
carriers are making an economic decision
to forgo carrying cargo outbound across
the Pacific and instead are sending the
containers back empty. "
US agricultural organizations and
even members of Congress were pressing the Biden administration to ensure

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refusing to carry US agricultural products. "
The groups explained, " These refusals
and charges by the ocean carriers dramatically increase costs to our exporters,
marking foreign sales inefficient and uneconomical, rendering farmers and processors, for the first time, unreliable suppliers to the global supply chain. "
The groups asserted, " The Shipping
Act provides the FMC with the authority
to prohibit unreasonable, unjust practices
and 'to promote the growth and development of US exports through competitive
and efficient ocean transportation.' Given the urgency of this situation in commerce, we ask that these tools and any
others available to our government be
immediately applied to stem the current
ocean carrier practices that are so damaging to our agriculture exports. "
Roger Isom, president and chief executive officer, Western Agricultural Processors Association, who signed the letter
addressed to the Biden administration,
recently told Ag Net West, " There's been
movement from the Federal Maritime
Commission. They're definitely taking a
deeper dive into investigating what the
shipping companies are doing, but it's
very bureaucratic. They're telling us it's
going to take weeks before any answers
come back. We don't have weeks. This
thing has been going on for months. " MBN
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Milling & Baking News - April 6, 2021

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