WASHINGTON: Business should return to normal at US West Coast ports in about three months, and long-term damage from a nine-month labor dispute should be limited, said Long Beach, Calif., Mayor Robert Garcia.
Mr. Garcia, who was traveling in Europe to meet with shipping executives, said he expects a deal agreed to in February to end the standoff would be ratified. He said there were still delays, including more than a dozen ships waiting to get into Long Beach and the port of Los Angeles, the two biggest container ports in the U.S.
The standoff is estimated to have cost importers, exporters, retailers and cargo movers billions of dollars. Labor officials from the International Longshore and Warehouse Union, and the Pacific Maritime Association, the body that represents employers of the 29 U.S. West Coast ports, agreed to a tentative five-year deal in February. Mr. Garcia said he expects the agreement to be ratified in April.
“There is never a 100% guarantee about anything, but I think it is very likely that the contract will be ratified,” he told The Wall Street Journal in a phone interview from Geneva on Friday. In Europe, Mr. Garcia has met with executives from the world’s three biggest container shipping companies, A.P. Moeller-Maersk Group A/S’s Maersk Line of Denmark, Switzerland-based Mediterranean Shipping Co. and France’s CMA CGM SA.
Mr. Garcia said there were still over 20 ships waiting to get into the ports of Long Beach and Los Angeles, and that it will still be some time before operations return to normal. “For Long Beach, it will take us three months to get back to normal conditions,” he said.
Nearly 50% of all clothing and shoes are imported into the U.S. via Los Angeles and Long Beach. The two ports are also the points of entry for the majority of all imports from Asia, including household goods, electronics, toys and food.
Earlier this month, Maersk Line Chief Executive Soren Skou said cargo owners are increasingly looking to divert cargo to other gateways, including ports in Canada, Mexico and the East Coast. A survey of shippers in March by the Journal of Commerce showed that 65% said they planned to ship less cargo through the U.S. West Coast through 2016, with a similar percentage planning to permanently reroute some cargo.
Long Beach has reported an 18.8% year-over-year fall in container volumes in January, while Los Angeles volumes were down 22.8%.
Mr. Garcia admitted that some business may have been permanently lost to East Coast ports as exasperated cargo owners looked for alternative entry points but he said “we are confident we will regain the vast majority of the business, because L.A. and Long Beach are still the best and fastest to get your goods in from Asia.”
