West Coast Port Strike Spotlights Corn, Soybean Export System Changes
Nine months of disruptive conflict and negotiations before the International Longshore and Warehouse Union (ILWU) and the Pacific Maritime Association reached a tentative agreement on operations, have caused the ports along the U.S. West Coast to gain a reputation for being unpredictable, and have caused tension in the soy and grain industries, according to Mike Steenhoek, Executive Director of the Soy Transportation Coalition. The ongoing labor disputes have raised serious concerns of trade disruption and economic fallout, and as a result foreign buyers are announcing that they will exit the West Coast in favor of operating out of alternative Gulf Coast ports as a viable replacement.
Also working against West Coast ports is the December 2015 scheduled completion of the Panama Canal expansion. Once operating at full capacity, increased efficiency of the system may save Asian buyers 35 cents per bushel of soybeans shipped, according to a study by the Soy Transportation Coalition. This will further increase transport along the Mississippi River and transport systems that feed into the Panama Canal route, causing a greater number of U.S. businesses to seek Gulf ports as their primary option.