10 of 14 Terminals Idled, Vessels and Intermodal Traffic Impacted
The ports of Los Angeles and Long Beach are shut down for a seventh consecutive day as Local 63 of the Office Clerical Unit (OCU) of the International Longshore and Warehouse Union (ILWU) continues striking. Without a contract since June 30, 2010, negotiations continued on and off until last week when the OCU walked off the job and the ILWU is honoring their pickets. This means that no vessels are being worked at ten of the fourteen terminals in the Los Angeles and Long Beach complexes.
Over the weekend, the mayor of Los Angeles, Antonio Villaraigosa entered the fray, sending a letter to the attention of John Fageaux, Jr., president of the union’s clerical unit, and Stephen L. Berry, chief negotiator for the employers group. Last week, the National Retail Federation sent a letter to the White House asking the President to get both sides to the table, or at least back to work.
The last time there was no work done on the waterfront for a significant period of time was 2002, when the ILWU was locked out by the employers group. The ten-day port closure cost the economy an estimated $15.6 billion, of which $14.4 billion was lost by importers and exporters as calculated by economic consultants Martin Associates.
On Friday, Hanjin announced an embargo for all international traffic destined to their International Container Terminal Facility in Long Beach and all on dock locations at both LA and Long Beach with the exception of TraPac, Pier A and PCT Terminals. The direct impact to shippers is that containers cannot be picked up or dropped off and trains that carry containerized cargo on and off the terminals to and from inland destinations are unable to be loaded or unloaded.
One carrier executive we spoke with on condition of anonymity is hopefully that there is positive movement today thanks to the involvement of Mayor Villaraigosa. “Negotiations will resume this morning. Differences remain, and the parties are continuing to work through them. The affected terminals will remain closed this morning and tonight.”
This impacts all companies equally. Whether you’re the largest multinational freight forwarder or a major retailer, it brings to light that the best risk planning and modeling in supply chains falls prey to things that cannot be directly controlled.
Rest assured that Camelot is watching the situation intently and will keep our customers and friends of the firm fully apprised of the situation. A few excellent sources for current news on the situation are:
And may we also suggest not losing sight of what is happening on the East Coast, either.