U.S. Sen. Ron Wyden and several colleagues are pushing the Federal Maritime Commission to protect the access of exporters to ocean carriers amid surging demand during the coronavirus pandemic.
Ocean carriers bring in highly valuable consumer electronics, apparel, building equipment and other finished products from Asia to the U.S.
Containers have traditionally then gone to rural areas of the Pacific Northwest and have been loaded with products such as hay cubes, potatoes and lumber, before being sent back for export, said Peter Friedmann, the executive director of the Agriculture Transportation Coalition.
But demand is high for consumer imports, which earn ocean carriers a higher freight rate. The pandemic and uneven economic recoveries around the world have led to a shortage in containers and a dramatic increase in shipping costs. Carriers have opted to send containers back to Asia empty to expedite the import of more high-value consumer goods.
“The steamship lines are all private companies all around the world,” Friedmann said. “They apparently don’t care about the U.S. exporter, and they don’t really care about the consumer either. They’re just carrying the cargo and maximizing profits.”
The Federal Maritime Commission ordered ocean carriers and marine terminal operators to provide information determining whether legal obligations related to detention and demurrage under the Shipping Act of 1984 are being met. Wyden, an Oregon Democrat, and 23 other senators wrote the head of the commission, calling for appropriate action against ocean carriers.
“The need is urgent, especially with record container volumes at the nation’s major ports,” the senators wrote. “These volumes, and the resulting congestion, will only grow as the global economy recovers from the coronavirus pandemic. Producers rely on competitive access to foreign markets, and the reported actions by certain (container carriers) to undermine this access pose significant ramifications for agricultural exporters and the industry at large.”
A representative of Wyden’s office said the senator has not heard back yet regarding the fact-finding mission.
One of the exporters affected is Hampton Lumber, which exports premium wood products to Japan through Tacoma and Seattle. Kristin Rasmussen, a spokeswoman for Hampton, said the company is even more affected by the carrier issues when trying to import specialty construction products.
“The container shortage is creating major supply problems in the U.S.,” she said in a statement. “It’s a big factor limiting home construction at the moment because so many building products come from China. Something as simple as a door jamb is in short supply right now.”
The Chinese government has previously taken action to control freight rate increases. “We want the U.S. to be as aggressive in supporting our exports as the Chinese have been aggressive in supporting their exports,” Friedmann said.