With ports here losing favor amid a potential dockworker strike and supply chain issues, concerns persist about how imports shifting elsewhere could impact California’s economy.
At least one California port had 21 percent less cargo volume in November compared to the same month in 2021.
On the retail side, companies have been diverting their shipments to other ports, mostly New York and New Jersey, Rachel Michelin, president and CEO of the California Retailers Association (CRA), told the Northern California Record
“Part of it is when you’re doing logistics, you need certainty,” Michelin said. “You need to know how you’re going to get your goods, how you’re going to get them off the ship and into the supply chain.
“And in California we’ve had so much uncertainty, we still have labor negotiations going on and people start to get a little nervous because they want to know how they’re going to get their goods into the U.S.
"It’s spreading into challenges in Los Angeles and Long Beach, and that means [businesses] are going to look at other ports where they can get their goods in faster.”
The Biden Administration has been asked to help with negotiations between the International Longshore and Warehouse Union and the Pacific Maritime Association
The contract expired in July.
“We all benefit from a supply chain that is running efficiently and effectively, and we need to get back to making sure we have a stellar goods management system in California,” Michelin said.
Meeting all of the state’s environmental goals is getting complicated by regulatory uncertainty, Michelin added.
“Innovation is going to be there on the private side. Unfortunately, because the public sector continues to insert itself, that’s gumming up the system,” Michelin said. “And we’d like to see more ability to allow us to meet environmental goals, meet their timeline, but not be overly regulated in the process – that’s what seems to be happening in California.”
Supply chain productivity isn’t likely to improve unless there’s resolution of the West Coast port workers’ contract negotiations. Port officials here have forecast it could be February before a deal is reached, Transport Topics reported.
“I hope we don’t fall into the same trap that we did, candidly, with the rail strike – we were waiting until the last minute to avert a rail strike,” Michelin said. “And we need not just to solve the immediate problem, but to develop a long-term strategy that keeps us from being in this situation again in the future.”