Feb 23, 2015

West Coast Ports Resume Normal Operations

U.S. West coast ports are back in business after a tentative deal was reached for a new five-year contract on Friday. The deal comes several days after U.S. Labor Secretary Thomas Perez intervened in the ongoing, nine-month negotiations between the union of dockworkers and the owners of 29 shipping terminals. The dispute has slowed down cargo movement, creating a massive traffic jam on the docks and a backlog of imported goods sitting in cargo containers. The West Coast ports handle goods that account for 12.5 percent of the U.S. economy.

Experts expect it to take weeks, if not months, to clear the backup and President Barack Obama urged “the parties to work together to clear out the backlogs,” the White House said in a statement.

The National Retail Federation issued a statement from President and CEO Matthew Shay:

“We congratulate the ILWU (International Longshore and Warehouse Union) and PMA (Pacific Maritime Association) for finally coming to agreement on a new labor contract. It is now time for the parties to quickly ratify the deal and immediately focus on clearing out the crisis-level congestion and backlog at the ports.

“We also thank Secretary Perez and the administration for engaging the parties on this critically important economic and supply chain priority.

“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. The agricultural, manufacturing, retailing and transportation industries have all suffered due to the nine-month long contract negotiations.”

Other industry groups are weighing in as well.

“Today’s slowdown on the West Coast may be the result of contract negotiations, but the impact it had on retailers provides a window into the future as increasing volumes and complexity will create similar backups, delays, higher costs and lost productivity,” said Kelly Kolb, vice president for government relations of the Retail Industry Leaders Association.