Mondiale Freight News

US west coast ports heading for total shutdown as union ups industrial action

Nov 10

As predicted earlier this week, go-slows at US west coast ports have now spread to southern California, with up to 80% of container handling capacity on the coast now in danger of being affected.
The west coast terminal employers’ body, the Pacific Maritime Association (PMA), yesterday said that dockworkers’ union the ILWU had begun refusing to dispatch hundreds of operators of yard handling equipment in the Los Angeles-Long Beach port complex, intensifying the already serious congestion in the region.
“Many of the qualified, skilled members the ILWU is withholding have more than 1,000 hours of experience operating this equipment. As a result, the PMA estimates that the ILWU’s withholding of skilled workers will leave half of the yard crane positions unfilled unless corrective actions are taken,” the PMA said in a statement.
The slowdown comes after six months of negotiations between the ILWU and PMA over a new master employment contract. The previous contract expired at the end of June, and until this week operations had continued as normal – although a combination of heavy pre-Christmas volumes, a lack of container chassis in the terminals and a shortage of drivers had led to congestion in Los Angeles and Long Beach.
With the new slowdowns, PMA spokesman Wade Gates said the congested ports could descend into gridlock.
“Although the existing congestion has had ripple effects throughout the supply chain, it is the ILWU slowdowns that now have the potential to bring the port complex to the brink of gridlock.
“The ILWU’s orchestrated job actions are threatening the west coast’s busiest ports and potentially billions of dollars in commerce. It is essential that the ILWU return to normal operations, as promised, so that we can continue meaningful negotiations in a productive environment free of union-staged slowdowns that are disrupting terminal operations at our largest ports,” he said.
Union sources confirmed that Local 13, the ILWU chapter that covers Los Angeles and Long Beach, had ordered members that operate yard equipment to leave scores of moves in the yards undone.
Meanwhile, congestion in Tacoma worsened this week, with a truck queue to the terminals said to be several miles long.
In response, a group of shipper and freight forwarder organisations has sent a letter to President Obama requesting his personal intervention to resolve the dispute. It predicted that the costs of the dispute could be as much as $2bn a day, citing recent research by the National Retail Federation
“The sudden change in tone is alarming and suggests that a full shutdown of every west coast port may be imminent. The impact this would have on jobs, downstream consumers and the business operations of exporters, importers, retailers, transportation providers, manufacturers and other stakeholders would be catastrophic,” the letter said.
It added: “We believe immediate action is necessary, and the federal government’s use of all of its available options would be helpful in heading off a shut-down and keeping the parties at the negotiating table.”
12 reasons for LA-LB port congestion

1. Big Ships
Impact: The largest ships in the U.S. trades are calling in Southern California. Each vessel call generates 5,000 to more than 10,000 container moves during the several days a ship is in port, stressing berth, yard and gate operations.
Solution: The big ships are here to stay. In fact, the vessels will keep getting bigger, so terminal operators must improve their productivity to handle the big ships
2. Bigger Cargo Volumes
Impact: Cargo volumes at the port complex through September are running 5 percent higher than the same nine-month period in 2013, despite a good deal of cargo diversion to other ports, and this unexpected growth is taxing the entire supply chain.
Solution: There will be a dip in volumes into December because all of the holiday merchandise has entered the country, but there will be another spike in January before the Chinese New Year. The entire supply chain must gear up for bigger volumes. This may necessitate the hiring and training of additional longshore labor and truckers.
3. Carrier Alliances
Impact: Alliance partners are spreading out their vessel calls over multiple terminals in Los Angeles-Long Beach — as many as five or six — creating a logistical nightmare for truckers and cargo interests attempting to match the right chassis with the right containers.
Solution: Carrier alliances are not going away, so the alliance partners must work closer together, beginning with the stowage of containers on vessels overseas. Alliance carriers must cooperate with each other, and with terminals in Los Angeles-Long Beach, in planning which terminals will handle vessels when they arrive in port.
4. Chassis Shortages
Impact: Chassis are scattered all over the harbor, in excess at some terminals and in deficit at others, making it extremely difficult for truckers to have the right chassis when the drivers need them to match with the containers that must be moved.
Solution: Operators of the largest chassis pools in the harbor have agreed to develop a grey chassis model, with roll-out promised for Feb. 1, 2015. Interoperability of chassis assets is crucial to resolving the equipment problem.
5. Gate Hours
Impact: Even though terminal operators in Los Angeles-Long Beach keep their gates open up to 10 shifts each week, long truck lines at the beginning of each shift and after lunch breaks indicate that continuous operations over 16 to 18 hours each day are necessary to prevent truck bunching.
Solution: Pier Pass Inc. announced on Oct. 24 that most of the 13 terminals in the harbor were running an early flex gate at 7 a.m. each morning, an evening flex gate from 5 p.m. to 6 p.m. and were adding staff to keep their gates open through the day lunch hour and evening dinner hour.
6. Labor Staffing
Impact: Congested marine terminals generate hundreds of extra container moves in the yards. Numbers posted on the Pacific Maritime Association website indicate employers are paying 20 percent more man-hours compared to last year even though cargo volumes in Los Angeles-Long Beach are up only 5 percent.
Solution: Extending gate hours, moving forward with the grey chassis concept and improving terminal productivity should eventually de-congest the terminals and reduce unnecessary container moves within the harbor.
7. Safety Checks
Impact: The California Trucking Association this fall reported that ILWU mechanics, possibly in line with coast wide contract negotiations, launched a new policy of secondary safety checks on tractors, chassis and containers, causing unacceptably long turn times for truckers.
Solution: The Pacific Maritime Association and International Longshore and Warehouse Union must immediately come to agreement upon a new contract. The contract’s grievance machinery will then be in effect, and employers can seek timely arbitration when there is cause to believe frivolous safety checks are being required.
8. Hard-Timing TraPac
Impact: TraPac, which will be the first terminal in the harbor to automate its operations, is resisting attempts by the ILWU to force the employer to accept manning requirements TraPac says are unnecessary. Productivity at the terminal is way down.
Solution: This is a war of attrition to see which side wins and sets a precedent for future automation on the West Coast. Once again, a coast wide labor contract will reinstitute the grievance machinery, and TraPac and the ILWU can seek arbitration to resolve the matter peacefully
9. Truck Capacity
Impact: Federal hours of service restrictions and severe terminal congestion have stressed truck capacity in the harbor beyond its breaking point. Drayage companies are turning down pleas from importers to take on new business because the motor carriers don’t have enough capacity to handle their existing book of business.
Solution: The Harbor Trucking Association says there would be sufficient truck capacity if the terminals weren’t so congested. As an interim solution, a request to the government to temporarily extend the hours drivers can work might offer some measure of relief. Improved turn times at the terminals are crucial to attract more drivers to the harbor
10. Vessel Bunching
Impact: Big ships are being delayed at major gateways around the world because they take longer to be worked. When they reach Los Angeles-Long Beach, the terminals are assigning only two or three work gangs alongside the ships, rather than five or six, and are using most of the workforce to decongest the yards, further delaying the vessels.
Solution: Terminal operators around the world must develop processes to turn the big vessels in a timely fashion so the ships can be kept on schedule.
11. Demurrage and Per Diem
Impact: Marine terminals without prior notice are refusing to accept empty equipment, they are restricting the time for storing export loads, and they are closing sections of their facilities to truck traffic. This is causing a surge in late charges for the return of containers and chassis, and processing the paperwork that is involved is adding to the congestion problem.
Solution: Some industry sources say that until the congestion problem is resolved, the ports and terminals should extend free time for equipment, but others say this policy would result in making congestion worse by reducing the sense of urgency for removing containers from the terminals
12. Port Non-Productivity
Impact: Shipping company executives have stated, and The JOC Group Port Productivity database numbers confirm, that U.S. terminals lag their counterparts in Asia and Europe in working today’s mega-ships, so the problems being experienced in Los Angeles-Long Beach today could easily spread to other U.S. ports in the near future.
Solution: Terminal operators must analyse existing work practices and work rules, borrowing best practices from world-class ports in Asia and Europe, to prepare U.S. ports for the eventual arrival of vessels with capacities up to 18,000 20-foot container units.
Seven container ships anchored off LA-LB
Seven container ships on average have been anchored in the waters off the ports of Los Angeles and Long Beach since Oct. 27, as the congestion crisis at the largest port complex in the Americas continues.
Seven container ships were anchored in San Pedro Bay this morning, the same as yesterday afternoon but a different mix of vessels, according to the Marine Exchange of Southern California. Waiting for berths today were the NYK Terra and NYK Aquarius, operated by NYK Line; the Dallas Express and Halifax Express, operated by Hapag-Lloyd; the Hanjin Greece, operated by Hanjin Shipping; the APL Holland, operated by APL; and the CSCL Winter, operated by China Shipping Container Lines. Two of those ships were due to shift to berth today, the Marine Exchange said.
There were 21 container vessels already at berth this morning at Los Angeles and Long Beach, with six of them due to sail today. Five more were expected to arrive, with one due to anchor and four expected to go directly to berth.

Monday, 10 November 2014

Posted: 2 years 10.2 months ago
Tags: action, US, industrial