Shippers pressure Biden as feared expiration of West Coast port labor contract looms

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LOS ANGELES — More than 150 local, state and national trade associations have implored U.S. President Joe Biden to push for a speedy and smooth resolution to West Coast port labor negotiations before they expire Friday night of the contract covering more than 22,000 workers.

Groups representing industries ranging from agriculture and apparel to trucking and toys have called on Biden to work with the International Longshore and Warehouse Union (ILWU) and the Maritime Association employers’ group (PMA) to extend the current contract, commit to continue negotiations in good faith and avoid any activity that would cause further disruption.

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“We know the administration understands the economic importance of these negotiations,” they wrote in a letter sent to Biden before the contract expired at 5 p.m. PDT Friday (0000 GMT Saturday).

The contract covering workers at 29 ports stretching from California to Washington state has been on Biden’s radar for months and he took the unusual step of meeting with the ILWU and PMA in Los Angeles on June 10. .

Indeed, disruptions at the West Coast’s ocean trade gateways, which handle nearly 40% of U.S. imports, could disrupt the country’s dilapidated supply chains, fuel inflation and threaten a flagging economy.

A slowdown or work stoppages at those ports could drive up transportation costs even further, exacerbating pressure on a slowing economy that is dragging down Biden’s approval ratings.

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« We’ve never had a White House dealing with these negotiations the way they are right now, » said Peter Tirschwell, vice president of shipping, trading and supply chain at S&P Global Market Intelligence. .

The ILWU and the PMA, which declined to comment for this report, said in a rare joint statement on June 14 that they did not anticipate any work stoppages or lockouts that would worsen supply chain congestion.

It’s important because when the contract expires, so does its « no strike » clause, Tirschwell said.

The last negotiation of the West Coast port labor contract broke down in 2015 after nine months of talks. Dockworkers halted work for eight days, a move that has clogged U.S. supply chains and siphoned around $8 billion from Southern California’s economy.

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History suggests an extension is not likely. The union in November rejected a one-year contract extension, saying its members had already granted a three-year extension to the current contract.

Automating the movement of containers through ports, which leads to fewer jobs, appears to be a key issue in the talks, which have been ongoing since May. Although the two sides did not identify the problem specifically, they published dueling studies on the impact of automation and traded barbs in the media.

In an interview with Reuters this week, US Labor Secretary Marty Walsh said he checks the ILWU and PMA weekly. They “continually tell me that we are in a good position. It’s moving forward,” Walsh said.

Meanwhile, wary senders take no chances. They route freight away from the West Coast to avoid potential labor slowdowns, especially at the nation’s busiest port complex in Los Angeles/Long Beach, which handles nearly $500 billion freight per year. This drives up their costs and contributes to backups in the ports of New York/New Jersey, Savannah and Houston.

(Reporting by Lisa Baertlein in Los Angeles Editing by Marguerita Choy)