Three months removed from a tentative contractual agreement between the Pacific Maritime Association (PMA) and the International Longshore and Warehouse Union (ILWU), container volume at the nation's trading ports are beginning to normalize, according to new analysis from the National Retail Federation and Hackett Associates.
"West Coast ports handled 33 percent more TEUs in March than last year."
West Coast ports, the main outlet through which goods are sent and received, handled approximately 1.7 million Twenty-Foot Equivalent Unit containers (TEUs) in March, NRF and Hackett Associates reported. That's up by nearly 45 percent from February and slightly more than 33 percent when compared with year-ago levels.
Jonathan Gold, NRF vice president of supply chain and customs policy, noted that port workers, truckers and everyone else who facilitates the flow of traffic along the West Coast's more than two dozen trading ports helped keep things moving in the first quarter, even though there are fewer hands there to provide assistance.
"Dockworkers and management made a massive push to clear the backlog of cargo over the past several weeks and West Coast ports are getting back to normal despite concerns such as the Teamster picketing seen in Los Angeles and Long Beach earlier this month," said Gold. "We hope to see this month's ratification vote go smoothly and then settle into a long period of efficient, dependable operations before we have to think about contract talks again."
Vote scheduled for May 22
In February, PMA and ILWU representatives came to an agreement in principle that would guarantee a labor contract for the next five years. A formal vote has yet to take place. This will happen on May 22. While members are expected to sign off on the accord, it could lead to another drawn out labor dispute, which led to the congestion issue at the nation's trading ports last year when the former contract expired in July.
Should the deal be signed, both the PMA and ILWU are confident that operations will normalize by the end of May, the Journal of Commerce reported. Some contend, however, that it's only a matter of time before congestion issues crop up again, mainly because ports need to be reformulated so that they're more in line with the gargantuan ships that take up so much room.
"The terminals are not designed for big ships," Dan Smith, principal manager for consulting firm the Tioga Group, told JOC.com.
He went on to say that ports will require at least 100 more cranes than are currently in place at the West Coast's 29 ports so that more offloading can be done simultaneously.
Ports expect 6 percent increase in TEUs from last year
As for how the rest of the first half of the year will go in terms of container shipments, NRF forecasts that 8.8 million TEUs will be handled. Should this prediction come to pass, it would be an increase of 6 percent over the first six months of 2014.