National Milk Producers Federation CEO Gregg Doud discusses the impact that the port strike could have on various industries and the economy on ‘The Bottom Line.’
The CEO of the Port of Long Beach is confident his Southern California can handle whatever increase in cargo it receives stemming from a dockworker strike at East and Gulf Coast ports.
“We do expect an increase in cargo” in the event of East Coast port strikes, Port of Long Beach CEO Mario Cordero told FOX Business in a Monday interview conducted prior to the contract deadline elapsing.
LOS ANGELES, CA – OCTOBER 16: Aerial view of containers waiting at Port of Long Beach to be loaded onto trains and trucks on October 16, 2021 in Long Beach, California. (Photo by Qian Weizhong/VCG via Getty Images) (Qian Weizhong/VCG via Getty Images / Getty Images)
“The shippers, in this particular case of the East Coast negotiations, the shippers have more comfort and certainty so thus history tells you that during these sorts of sensitive contract negotiations, they start diverting cargo to other gateways, in this particular case the West Coast,” he said.
PORT STRIKE: CAN WEST COAST PORTS ABSORB EAST AND GULF COAST IMPORT VOLUMES
Other ports along the West Coast and ones in Canada, including Halifax on the East Coast, could field cargo that gets re-routed, Cordero said.
“We’re in a very good position to handle whatever increase in cargo we receive,” he told FOX Business, referencing the cargo volumes that moved through the Port of Long Beach in August.
The port’s workers handled over 913,800 TEUs that month, representing a nearly 34% year-over-year increase, amid cargo diversions and potential tariff increases, the port said at the time.
“That is a historical amount in our 113 year history, the biggest month ever,” Cordero told FOX Business. “The great news is we’ve been able to do that with no congestion or bottlenecks here at the Port of Long Beach, so that’s a great pronouncement of progress, given what we experienced in the worst of the COVID-19 supply chain crisis.”
The Port of Long Beach was currently at approximately 70% capacity.
Cordero said strikes at East and Gulf Coast ports would not impact West Coast operations.
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“It’s fair to say that whatever business comes our way in the West Coast, we’re able to handle that and have an efficient throughput of whatever service comes our way,” he said. “I think there’s a lot of lessons learned from the COVID-19 experience.”
LONG BEACH, CALIFORNIA – NOVEMBER 12: A Long Beach Fire harbor patrol boat passes near container ships before Sen. Alex Padilla gave a press conference at the Port of Long Beach on November 12, 2021 in Long Beach, California. Padilla highlighted the (Mario Tama/Getty Images / Getty Images)
Some of Long Beach’s preparations include having its Business Recovery Task Force at the ready and working with its partners.
“If there is a prolonged stoppage, it will impact the economy as a result of higher costs, because any time you have any kind of supply chain interruption like we did in COVID-19 you’re talking about additional costs,” Cordero told FOX Business. “It’s a very sensitive time given the fact that we have a very good economy and the inflationary rate is on a very positive trajectory … We certainly don’t want as a nation any factors that takes us the other way so I think it’s probably the foremost of importance in terms of what this means to the nation, that is avoiding any work stoppage of any prolonged nature whatsoever.”
LOOMING PORT STRIKE BY THE NUMBERS: NEW YORK, SAVANNAH, BALTIMORE EXPECTED TO SEE DISRUPTIONS
The Port of Long Beach CEO said there are negotiations between the dockworkers’ unions and the employer associations every six years.
Last year, the Pacific Maritime Association and the International Longshore and Warehouse Union inked a new six-year contract of their own without a work stoppage occurring. The agreement, reached after lengthy discussions, applied to some 22,000 dockworkers employed by 29 ports on the West Coast, including Long Beach.
The Port of Long Beach saw over 8 million TEUs of cargo over the course of last year.
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