Americas News
Shippers Look to Permanently Change Ports of Call After U.S. West Coast Labour Disruption
Shippers who diverted cargo away from U.S. West Coast ports due to slowdowns caused by an extended labour dispute may not revert routes back to previous ports, The Wall Street Journal reports.
Union negotiations in West Coast ports stretched on for over seven months before finally coming to an end in February, though not before many shippers had already begun changing trading routes to ports on the East Coast, Gulf Coast, Western Mexico, and Canada instead.
According to a survey by the Journal of Commerce, 65 percent of shippers who responded planned to ship less cargo through the U.S. West Coast through 2016, while a similar percentage are moving to permanently reroute some cargo.
"About a third of our cargo is purely discretionary," said Gene Seroka, executive director of the Port of Los Angeles.
The trend of ships heading elsewhere had reportedly accelerated in recent months, with imports at the port falling 28 percent year-over-year in January.
More business is also predicted to be diverted in the future, given the expansion of the Panama Canal.
"Some of that cargo has moved to other port complexes," said Seroka.
"It's going to be extremely difficult to earn that business back."
However, agriculture and smaller businesses are expected to the return to West Coast ports, as they are more hampered by geography and cost.
Last month it was reported that U.S. West Coast Suppliers were fearing low demand in the last months of the labour dispute due to the prevalence of ships heading elsewhere.
