US West Coast ports to begin tackling backlog after labour deal; relief for trans-Pacific trade
Monday, 23 February 2015 00:00
Freighters and cargo containers sit idle last week at the Port of Los Angeles as a back-log of over 30 container ships sit anchored outside the Port in Los Angeles, California - REUTERSReuters: US West Coast ports resumed full operations from Saturday evening after a tentative labour deal was reached between a dockworkers union and a group of shippers, easing months of disruptions to trans-Pacific trade that have hit businesses from automakers to meat exports.
The agreement involving 29 ports was announced late on Friday in a joint statement by the two sides. It was reached three days after US Labour Secretary Thomas Perez arrived in San Francisco to broker a deal with the help of a federal mediator who had joined the talks six weeks earlier.
The White House called the deal, reached after nine months of negotiations, â€˜a huge reliefâ€™ for the economy, businesses and workers. President Barack Obama urged the dockworkers and the shipping companies to work together to clear the port backlogs.
The 20,000 dockworkers covered by the tentative five-year labour accord have been without a contract since July. Tensions arising from the talks have played out since last fall in chronic cargo backups that increasingly slowed freight traffic at the ports.
The dispute had reverberated throughout the US economy, extending to automobile, agriculture, food, manufacturing, retail and transportation.
According to the American Association of Port Authorities, some $ 3.8 billion worth of goods move in and out of US seaports each day.
The West Coast ports handle nearly half of all US maritime trade and more than 70% of the countryâ€™s Asian imports.
During the dispute, shipping companies sharply curtailed operations at the marine terminals, suspending loading and unloading of cargo vessels for night shifts, holidays and weekends at the five busiest ports.
Port officials have said it would take six to eight weeks to clear the immediate backlog of cargo containers and several months for freight traffic to return to a normal rhythm.
The West Coast waterfront still faces a range of systemic problems cited by port authorities as factors in the backups.
Still, the settlement stopped the labour dispute from devolving into a full-scale, extended shutdown of the ports, which the retail and manufacturing industries have projected could cost the US economy some $ 2 billion a day.