Sea shipments to Kaua’i to start up, while West Coast port shutdown continues

FRESNO, Calif. (AP) – A weeklong shutdown of the West Coast’s major ports has left stacks of market-bound farm produce to rot on the docks and in the holds of ships that can’t reach shore.

Meanwhile, the Pacific Maritime Association on Friday night granted Gov. Ben Cayetano’s request that Hawai’i be given an exemption from the West Coast port lockout.

The exemption means that shipments of goods to Kaua’i should again pick up in about a week.

“This is good news for the people of Hawai’i,” said Cayetano spokesman Jackie Kido. “There are people here on very tight margins.”

Hawai’i depends on ocean transport more than any other state, importing about 90 percent of its goods through container ships from ports in California and Washington state.

The last container ship to leave the West Coast before the lockout began arrived at Honolulu Harbor on Thursday.

The process of unloading ships to make way for cargo bound for Hawai’i was expected to begin Saturday. Once loaded, the ships will take about five days to reach Honolulu.

James Andrasick, president and chief executive of Matson Navigation Co., one of Hawai’i’s major shipping companies, said if all goes well, the first ships should reach Honolulu on Oct. 13.

As contract talks continued between the dockworkers union and shipping lines Saturday, about 1.3 billion apples were awaiting shipment to Asia, nearly 8,000 tons of frozen meat from Australia sat in untouched shipping containers, and hundreds of tons of other fruit and food products remained far from intended markets.

About 5 million pounds of yellow, red, pearl and other onions grown in the Northwest are in danger of becoming moldy, said Del Allen, president of Allports Forwarding, a cargo booking business for farm products.

Each day it continues, the shutdown is costing the U.S. economy an estimated $2 billion, and for many farmers, it comes at the worst possible time – the peak of the fall harvest.

“By not having product being shipped to customers, you’re also not receiving money,” said John Rotteveel, who grows and packs almonds in Dixon, Calif., and exports about 90 percent of his crop.

On Saturday, as representatives of dockworkers and management began their third consecutive day of meetings with a federal mediator in San Francisco, the White House warned both sides to resolve their differences.

“The president’s message to labor and management is simple: You are hurting the economy,” press secretary Ari Fleischer said while traveling with President Bush in New Hampshire.

Two senior administration officials said Bush was considering appointing a board of inquiry into the lockout, a potential first step toward ordering workers back to their jobs for 80 days under the Taft-Hartley Act. Shippers have urged Bush to use the act, but several unions have spoken out against it.

The contract dispute between shipping lines and dockworkers – largely over benefits, the arbitration process and whether jobs created by new technology will be unionized – has sent ripples through nation’s agriculture industry, causing slowdowns of the harvest, and in some cases, layoffs.

Burlington Northern Santa Fe Railway stopped grain shipments to the West Coast on Tuesday to avoid further congestion at the ports, said Patrick Hiatte, the railway’s spokesman.

At sea, much of the chilled beef, lamb and mutton held up on ships could spoil before it reaches consumers, said Dennis Carl, chairman of the Australian Meat Council’s shipping committee.

Though most products can be safely refrigerated, storage problems and costs are mounting.

The D.J. Forry Co. spent $7,200 to bring 1,360 crates of plums from the Port of Long Beach to its warehouse in Reedley, Calif., and will spend $5,000 more to truck them to East Coast docks before a much longer voyage to Asia.

Sales manager Cary Crum said D.J. Forry also is bringing grapes back from the port and plans to truck them to New Jersey for shipment to the United Kingdom. The company will have to absorb the extra shipping costs, rather than sell the plums and grapes domestically, because they’re already packaged for overseas markets.

Other producers are redirecting food to American supermarkets, which could mean lower prices, said Colin Carter, a professor of agricultural resource economics who studies international trade at the University of California, Davis.

Wholesale prices are already dropping for beef, said Chuck Lambert, chief economist for the National Cattlemen’s Beef Association.

“Several of the cattle processors are reducing their purchases of cattle and stopped processing product for the Asian market,” he said. “We’re seeing cattle prices about $25 less per animal that could be attributed to this work stoppage.”

Between 20 and 30 percent of all U.S. agriculture products are exported, according to the U.S. Department of Agriculture.

Top exports include cotton, soybeans, beef and fruits and vegetables to Mexico, Europe and the Pacific Rim countries of Japan, South Korea, Taiwan, Hong Kong and China. The rim accounts for a third of all U.S. farm exports, the American Farm Bureau said.

“If the ports are not opened immediately, we will face shortages of fresh produce, some dry goods and nonfood products that only may be obtained from overseas,” said John Motley of the Food Marketing Institute.

The Pacific Maritime Association, which represents shipping companies and terminal operators, locked out 10,500 members of the longshoremen’s union last weekend, claiming the dockworkers had engaged in a slowdown to gain leverage in the contract talks.

The association granted an exemption for cargo going to Hawaii, following a similar one given for Alaska-bound goods, and the union said its members would move the cargo.

U.S. Labor Secretary Elaine Chao said the department “continues to be very concerned about the situation and we’re monitoring it daily.”

“Many farmers have had a very dry season and they are not able to shop their goods, and they’re probably the first ones that are hit by the West Coast ports situation,” she said.

But the biggest concern for farm groups is that a prolonged dispute could mean a big loss in market share among overseas customers, said Bill Pauli, president of the California Farm Bureau Federation.

“The threat is real that foreign buyers could take their business elsewhere,” he said. “A prolonged shutdown could lead to lost overseas markets and downward pressure on farm prices.”

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