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ILWU, PMA hope to reach contract deal ‘soon’
West Coast longshore workers and their employers said negotiations on a new contract are continuing. They said the two sides “remain hopeful of reaching a deal soon.” The ILWU and PMA have rarely communicated over the past 10 months. Therefore, the joint statement from the parties is very notable, although largely repetitive.
Shippers and West Coast ports are growing frustrated with the negotiations. Shippers have been rerouting discretionary cargo away from the West Coast in order to avoid disruptions linked to the negotiations. As a result, the West Coast’s market share of US imports from Asia fell from 61.5% last year to 58.8%.
The ILWU and PMA resumed negotiations two weeks ago after agreeing to sideline a controversial jurisdictional issue involving Terminal 5 in Seattle.
In the joint statement, the parties mentioned a prior agreement on health benefits and said that they “remain committed to resolving remaining issues as expeditiously as possible.” They also said that “West Coast ports have continued to operate” during the negotiations. However, the Port of Oakland saw occasional shutdowns and the Ports of LA and LB have experienced work slowdowns.
A new deal would cover 22,000 workers at 29 ports along the West Coast.
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Container shipping navigates uncharted waters
Regardless of how difficult the past few years have been for shippers and transportation providers, the future is once again the focus. The market is shifting rapidly and is moving into a phase that is familiar yet unpredictable.
Recent developments signify that the industry has left the COVID period behind and is entering a new era. The new times are defined by a rocky geopolitical environment, the politics surrounding shipping, and a new shipping structure due to the breakup of the 2M Alliance.
Rates are dropping rapidly and port congestion and delays are easing. Therefore, contract negotiations and pricing should normalize. The new era will be defined by the acknowledgement and avoidance of risk.
In the past, supply chains were defined by opportunity and efficiency, reliability was taken for granted, risk was removed, and disruptive events were viewed as individualized. That has changed and unpredictability is now assumed. A good example is the massive diversion of freight from the West Coast to the East Coast that many sources attributed to the avoidance of risk.
In addition to the new perspective on risk, legislation and politics surrounding shipping will also impact the industry in the future. There is talk in Washington that legislators may continue to rewrite shipping legislation beyond OSRA-22.
Lastly, the breakup of MSC and Maersk in the 2M Alliance will shake up the industry in 2025. The two biggest carriers have achieved scale large enough to operate on their own, changing the industry overnight.
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About O’Neill Logistics
O’Neill Logistics is a leading third party logistics provider. We operate in California, Savannah, New Jersey. We service many verticals including Garments, Fashion Accessories, Footwear, Furniture, Home Goods, & Electronics. Additionally, we offer omni-channel distribution and all value-added services. Lastly, we focus on retail “drop shipment” fulfillment and item-level fulfillment services with same-day service offerings.
O’Neill Logistics has over 2 million square feet of state-of-the-art facilities. Additionally, we offer dray services to support the warehouses and provide distribution to retailers and wholesalers. Our reliable 3PL platform combines sophisticated technology with robust, flexible processing designs and speed-to-market gateway models.
Lastly, we aim to simplify your supply chain. We deliver exceptional service and can optimize your operational performance. Therefore, we aim to build, protect and foster strong business partnerships.
Please reach out to us if you have any questions or need assistance with your logistics solutions!