Tentative five-year labor pact paves way to ease congestion at West Coast ports

The Pacific Maritime Association (PMA) and International Longshore and Warehouse Union (ILWU) on Friday announced they reached a tentative five-year agreement covering dock workers at all 29 West Coast ports.

Settled with assistance from the U.S. Department of Labor and Federal Mediation and Conciliation Service, the pact ends more than nine months of sometimes contentious negotiations between the parties. The agreement is subject to ratification by PMA and ILWU members.

National Retail Federation President and Chief Executive Officer Matthew Shay hailed the tentative agreement, which now will enable the parties to focus on easing congestion at West Coast ports. The cargo catch-up process could take several months.

"The congestion, slowdowns and suspensions over the last few months have had a significant economic impact on the entire supply chain and those who rely on the West Coast ports to move their goods and products around the world and throughout the country," said Shay in a prepared statement.

Port of Long Beach CEO Jon Slangerup also welcomed the agreement and the opportunity to improve cargo flows at busy ports.

"We know that the marine terminal operators, longshore workers, truckers, railroads and others will be extremely busy as they work to clear out the massive backlog of cargo at all of the West Coast ports, including Long Beach," he said in a statement. "All of us will be working together to make this happen as soon as possible."

The Port of Long Beach felt the impact from ongoing congestion last month, when it handled 429,490 20-foot equivalent units (TEUs), down 18.8 percent compared with January 2014 volume. Imports tumbled 23.5 percent to 213,667 TEUs, exports slid 19.6 percent to 98,462 TEUs and empty container volume fell 7.6 percent to 117,361 TEUs.

Volume at the ports of Seattle and Tacoma, Wash. — which now report their combined volume as the Seaport Alliance — also reflected the slowdown. In January, total volume fell 13 percent to 226,906 TEUs, imports plunged 21 percent to 89,982 TEUs and exports dropped 7 percent to 81,213 TEUs.

"We are uncertain how long it will take to move the remaining cargo on our docks and awaiting vessels, and to assess the effects this [labor issue] has had on our gateway," Seaport Alliance officials said in a statement addressing the tentative agreement.

On the East Coast, January volumes were much more encouraging. The South Carolina Ports Authority (SCPA) boosted container traffic 18 percent year over year to 152,917 TEUs. The South Carolina Inland Port — a significant rail volume driver — reached an all-time high in monthly rail lifts at 5,068, SCPA officials said in a press release.

The authority also reported record intermodal rail growth in 2014 at 199,000 lifts, up 38 percent compared with 2013. Rail volume has doubled since 2011 and nearly 20 percent of the authority's total container volume currently moves by rail, SCPA officials said.
 
In Norfolk, the Port of Virginia handled 191,996 TEUs in January, a 14.8 percent year-over-year gain. Rail volume shot up 22.1 percent and Virginia Inland Port volume rose 3.2 percent.