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Uncertainty Over Labor Contract Impacting Volume at West Coast Ports

02/20/2023

Gene Saroka, Executive Director of the Port of Los Angeles, has predicted significant volume declines in containers processed on West Coast ports during 2023 with volume down from pre-COVID levels.  Failure to agree on a long-term labor contract has created uncertainty among importers who have moved freight to Gulf and East Coast ports. This move is facilitated by widening of the Panama Canal that reducing the duration of voyages by very large container vessels from ports in Asia to the U. S.

 

The ports of Charleston, SC. and Savannah, GA. are benefitting at the expense of Long Beach and Los Angeles.  In comparison to January 2020, volume in Los Angeles during January 2023 was down 10 percent and Long Beach, by 15 percent.  In contrast, imports through Savannah, were up 12 percent and through Charleston, 20 percent.

 

It is noted that West Coast ports have not benefitted from investment in modernization with only $1.2 billion in improvements over the decade through 2020.  In contrast, eastern Gulf Coast ports received $11 billion for dredging of channels, introduction of mechanization and improved ship-to-rail transfer.