Pacific port problems put businesses behind

By ELAINE WILLIAMS of the Tribune

Two business leaders say certain kinds of commerce have almost ground to a halt in the region because of a labor dispute at West Coast ports.

The volume of shipping containers being handled at Pacific ports has slowed as the International Longshore and Warehouse Union negotiates with the Pacific Maritime Association, which represents terminal operators, cargo handlers and cargo carriers. Each side blames the other for the backup.

The problems are reaching to small operations such as Inland Empire Milling in St. John, with 12 employees; larger ones like Brocke and Sons, which has a staff of about 40 in Kendrick; and even Lewiston’s largest private employer, Clearwater Paper.

Since slackwater came to Lewiston, Brocke and Sons Vice President Bert Brocke said the routes overseas have never been so congested.

Containers loaded in December for Inland Empire Milling Co. still haven’t been accepted at ports, said Jerry Schauble, owner of the company that exports wheat, barley, dried peas, corn and soybeans.

“Our customers are now wanting to back out of contracts we’ve made with them because they went ahead and sourced the product from other countries,” said Schauble, who sends 90 percent of his products through West Coast ports.

That’s not the only issue, Schauble said. His business typically has five days from the time it retrieves a container from the coast to return it filled. But he can’t meet that time frame and is being charged extra because the system is so clogged.

Brocke and Sons is facing challenges because of the situation, too. Anywhere from 100 to 150 containers loaded with dried peas, lentils and garbanzo beans are stranded between Lewiston and Portland, Ore., waiting in line to go overseas. Brocke said he uses the Pacific ports to ship about 75 percent of his product.

None of his customers are walking yet, since they understand the company cannot control the slowdown. But he wonders how long that empathy will last.

Clearwater Paper mentioned the dispute in a conference call this week for analysts about its year-end results.
Paperboard sales declined 12 percent in the last three months of 2014, compared with July, August and September. That decrease was “well below” the company’s prediction of 4 to 8 percent, said Chief Financial Officer John Hertz.

“A typical fourth quarter decline was exacerbated by labor-related slowdowns at West coast ports,” he said during the call.

Relief could be on the horizon. The longshoreman union has described the two sides as being extremely close to an agreement. The Pacific Maritime Association announced this week that it made an offer that includes a 14 percent pay raise over five years and a continuation of medical benefits that have no premiums and no in-network deductibles or co-pays.

But even if the two sides settle today, both Schauble and Brocke said they’ll be dealing with the effects for months.

“We have been hurt and don’t even know to what extent yet because we don’t know when it’s going to end,” Schauble said.

Williams may be contacted at [email protected] or (208) 848-2261.