Representatives of the International Longshoreman’s Association and the US Maritime Alliance (USMX) are optimistic that the two sides can reach an agreement on a new deal to replace a contract which expires at the end of September 2018, avoiding the turmoil that hit US West Coast ports late last year and early this year.
USMX represents ocean carriers and ports from Maine to Texas, covering the US East and Gulf Coasts. The ILA represents longshoremen in the same geographic area.
David Adam, president of USMX, credited both sides for creating a productive working relationship, while speaking at the South Carolina International Trade Conference in September. “We haven’t had a strike or slowdown or any other type of labour issue since 1977. The relationship is in a very, very good place.”
Benny Holland, vice president emeritus of the ILA, said that the union views USMX as a partner. “A lot of people think that USMX and the ILA are enemies. We’re not enemies. We’re partners in moving a product from the manufacturer to the consumer. If we don’t do our job, they don’t need any of us,” he said at the conference, which is organized by the South Carolina Ports Authority.
One benefit for negotiators is that, unlike US West Coast contracts, each port in the US East and Gulf Coast has its own contract, allowing negotiators to easily address local issues. “We administer the master contract, but the 14 local ports are negotiated locally,” Adam said, noting that the West Coast contract is applied evenly across all ports. The USMX/ILA contract covers container and ro-ro, but does not cover break bulk cargo.
“At the current time, the master contract is fully-implemented,” Adam said. “All the local agreements are complete. The relationship is in a very, very good place. We have good communication and cooperation. We’ve been working together really well for the past two or three years. [The relationship has] been really productive.”
Importantly, both sides to the upcoming contract negotiation hope to keep the relationship congenial. Holland related stories he had heard about the West Coast labour strife earlier in the year. “I heard some horrible stories from shippers [about] what happened to them after the West Coast lock-out and strike,” he said. “I went back and told our president, look, we can’t have that happen on the East Coast. We’ve got to make sure the shippers feel very comfortable that they’re not going to have a problem moving their product, they’re not going to have a problem getting their goods to the customer or to the consumer. We need to look at a long-term agreement.”
Adam said that USMX is also serious about negotiating a deal which is good for all sides, potentially before expiration of the current contract. “I believe both sides are very committed to serious discussions and talking about the issues very seriously, and are really trying to be productive. We can benefit from getting this done sooner rather than later, if we get the right agreement in place.”
Although both panelists spoke frequently of a 10-year contract, Adam went out of his way to say that a specific contract length has not yet been agreed upon.
“We need to sit down and put an agreement together that will be good for the shipper, but will also be good for the carrier and for the labour that services those vessels,” Holland said. “And we need to put our heads together and take a little bit of time [but] not a lot of time, because the sooner we get this done, the better. We’ve got a small window of opportunity to show people that they can come to the East Coast and they can come to the Gulf Coast and they can work their product and not have a problem. That’s our goal. We’re on board as long as it makes sense.”
Should a deal that benefits all parties actually come to fruition, the parties who use the ports and use the labour at the ports will be pleased, said Allen Clifford, executive vice president of Mediterranean Shipping Company, who spoke at a different session of the conference.
“It’s very easy to say it’s over, but the pain [of the West Coast labour strife] is still with many of us: ocean carriers, intermodal providers, steamship lines, truckers, shippers, freight forwarders,” Clifford said. “It was a very, very difficult time, because each one felt that their point was not properly heard. Each one felt that they were right. In this particular environment, you can’t work like this.”
Clifford notes that there is a set of shippers – manufacturers, particularly – who say that they won’t get burned again, and that they want to continue moving cargoes off the Atlantic and Gulf coasts and that they’re not going to ship as much as they did previously from the Pacific coast.
Although there are some situations where it simply doesn’t make sense to ship from the East Coast – for a manufacturing facility just outside the Port of Los Angeles, for example – Clifford expects many of the gains seen by the East and Gulf Coasts to remain. “There is a certain amount of cargo that will remain on the Atlantic coast and the Gulf coast because of great intermodal abilities,” he said.
By Gregory Glass
Asia Cargo News | Charleston, South Carolina
