A11
B USINESS
THE BULLETIN • TUESDAY, MARCH 16, 2021
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DOW
32,953.46 +174.82
BRIEFING
Security-camera
hack leads to raid
Swiss authorities on
Monday confirmed a po-
lice raid at the home of a
Swiss software engineer
who took credit for help-
ing to break into a U.S.
security-camera com-
pany’s online networks,
part of what the activist
hacker cited as an effort
to raise awareness about
the dangers of mass sur-
veillance.
The Federal Office of
Justice said regional po-
lice , acting on a legal as-
sistance request from U.S.
authorities, on Friday car-
ried out a house search
involving hacker Tillie
Kottmann.
Kottmann had iden-
tified as a member of
a group of “hacktivists”
who say they were able
to view live camera feeds
and peer into hospitals,
schools, factories, jails
and corporate offices for
two days last week after
gaining access to the sys-
tems of California startup
Verkada. They said the ac-
tion was aimed at raising
awareness about mass
surveillance.
Verkada later locked
them out . The company
alerted law enforcement
and its customers.
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U.S. air travel rises to highest levels yet Manager
admits
to fraud
of over
$12M
NASDAQ
13,459.71 +139.84
S&P 500
3,968.94 +25.60
BY DAVID KOENIG
The Associated Press
Across the United States,
air travel is recovering more
quickly from the depths of the
pandemic, and it is showing
up in longer airport security
lines and busier traffic on air-
line websites.
The Transportation Security
Administration screened more
30-YR T-BOND
2.37% -.03
than 1.3 million people both
Friday and Sunday, setting a
new high since the coronavirus
outbreak devastated travel a
year ago. Airlines say they be-
lieve the numbers are heading
up, with more people booking
flights for spring and summer.
“Our last three weeks have
been the best three weeks
since the pandemic hit, and
GOLD
$1,728.90 +9.40
CRUDE OIL
$65.39 -.22
each week has been better
than the one prior,” American
Airlines CEO Doug Parker
said Monday.
Airline stocks rose across the
board. Shares of the four big-
gest U.S. carriers hit their high-
est prices in more than a year.
However, the airlines still
have far to go before travel fully
returns to pre-pandemic levels.
SILVER
$26.25 +.37
While the number of peo-
ple passing through airport
checkpoints has topped 1 mil-
lion for four straight days and
the 7-day rolling average is the
highest in the pandemic era,
passenger traffic is still down
more than 50% in March
compared with the same pe-
riod in 2019.
See Travel / A13
Man worked for grass
seed company that
sold to Oregon growers
BY MAXINE BERNSTEIN
The Oregonian
Steve Ringman/The Seattle Times
Empty fruit bins that would ordinarily be filled and exported overseas in cargo
containers are waiting at Stemilt Growers’ fruit-packing plant in Wenatchee,
Washington, on March 8.
Idaho hemp bill
clears committee
A bill that would le-
galize industrial hemp in
Idaho is a step closer to
becoming law.
The state Senate Agri-
cultural Affairs Commit-
tee voted unanimously
March 11 to send House
Bill 126 to the full Senate
with a do-pass recom-
mendation. The House of
Representatives passed
the bill 44-26 on March 8.
“We need to have ad-
ditional opportunities,”
said Idaho Farm Bureau
Federation board Vice
President Richard Durrant,
a producer in Kuna. “This
has been a long process
getting through every-
body’s needs.”
Idaho is the only state
that does not legalize
hemp in some form. The
Legislature in 2020 and
2019 considered but did
not pass legalization bills.
Gov. Brad Little issued an
executive order authoriz-
ing interstate transport
of hemp.
Stocks extend
gains for fifth day
Stocks closed broadly
higher Monday, nudg-
ing some of the major
U.S. indexes to more all-
time highs as the market
added to its recent string
of gains.
The S&P 500 rose 0.7%,
extending its winning
streak to a fifth day. Tech-
nology stocks, airlines,
cruise operators and
other companies that rely
on consumer spending
helped lift the market.
Banks and energy stocks
were the only laggards.
Wall Street continues
to eye the bond market,
where yields pulled back
a bit from Friday’s sharp
increase. Investors are
also focused on the recov-
ery of the U.S. and global
economies from the coro-
navirus pandemic. The
$1.9 trillion aid package
for the U.S. economy has
lifted investors’ confi-
dence in a strong recov-
ery from the pandemic
in the second half of the
year, but also raised con-
cerns about a potential
jump in inflation.
President Joe Biden’s
pledge to expand vaccine
eligibility to all Ameri-
cans by May 1 should also
translate into faster eco-
nomic growth.
— Bulletin wire reports
EURO
$1.1926 -.0024
FARM EXPORTS
ARE DEAD IN
THE WATER
A former manager of a
Washington-based company
that produced and sold grass
seed and turf grass to indepen-
dent growers in Oregon admit-
ted to a series of mislabeling,
pyramid and real estate invest-
ment schemes that defrauded
customers and netted him
more than $12 million.
Christopher Claypool, 52 , of
Spokane, pleaded guilty Mon-
day to conspiring to commit
wire fraud and money launder-
ing during his first appearance
in federal court in Portland be-
fore U.S. District Judge Karin J.
Immergut.
Claypool is scheduled for
sentencing June 21, and pros-
ecutors will seek a four-year
prison term if he follows the
conditions of his pre-sentenc-
ing release, including paying
$8.3 million in restitution plus
unpaid taxes for undeclared
income.
The various schemes ran
from about January 2015
through August 2019, accord-
ing to a federal prosecutor.
Claypool had worked for Jack-
lin Seed Co. at its headquarters
in Liberty Lake, Washington.
Prosecutors said Claypool
and a colleague directed em-
ployees at Jacklin and a dis-
tribution facility in Albany,
Oregon, to fill customer or-
ders with different, lower-yield
varieties of grass seed and
conceal the substitutions with
mislabeled bags while charging
customers for the higher-yield
seeds they had ordered, ac-
cording to prosecutors.
See Fraud / A13
BY PAUL ROBERT • The Seattle Times
T
ens of thousands of boxes of apples that should be on
their way to the Middle East and Asia are piling up
instead in Wenatchee, Washington, warehouses.
In Ellensburg, Washington, it’s a
similar story for mountains of hay
bales that would otherwise be on
container ships bound for Japan
and South Korea.
The problem isn’t a lack of de-
mand: Foreign buyers are eager
for farm goods from Washington
and other states. But thanks to the
strange effects of COVID-19 on
global shipping, U.S. farm exports
are barely moving.
In normal times, “We ship 10 to
15 containers of fruit every week
into Taiwan,” says Dave Martin,
export sales manager for Stemilt
Growers in Wenatchee, one of
Washington’s biggest tree-fruit ex-
porters. “This week, we will not
have a ship.”
The shortage of cargo space has
backed up Stemilt’s huge pack-
ing operations and idled dozens
of truckers who normally haul the
40-foot-long containers to the ports
of Seattle and Tacoma. It has also
prompted Stemilt’s foreign buyers
to look to competitors in countries
such as Chile, where the apple har-
vest is just starting. “Those sales are
lost,” Martin says of the numerous
foreign shipments Stemilt has for-
gone since November, when the
shipping crisis became severe.
The cargo-space crunch is the
latest symptom of a global trade
system that was unbalanced even
before the pandemic, but is now so
lopsided that entire sectors are at a
virtual standstill.
Since the start of the pandemic last
spring, Americans have spent far less
on services, such as dining out, and
far more with Amazon and other
online retailers. That in turn has
sparked a surge in imports from Asia.
The wave of mainly Chinese
goods has overwhelmed some West
Coast ports, especially in Los An-
geles, where ships often sit for days
waiting to unload. And because
some of those ships, once they un-
load in Los Angeles, go pick up
cargo at other West Coast ports,
bottlenecks in Southern California
have meant major delays for export-
ers waiting to load their goods in
Seattle and Tacoma.
“We are now experiencing un-
precedented eastbound cargo vol-
umes coming out of Asia to the U.S.,
and it’s creating huge disruptions
within the supply chain,” says John
Wolfe, chief executive officer of the
Northwest Seaport Alliance, which
manages marine cargo operations
in the ports of Seattle and Tacoma.
But the surge in Asian imports
has had another effect on North-
west farmers. Because U.S. demand
for Asian products is so high, ship-
ping companies can now make far
more money sending empty con-
tainers back to China as soon as
possible, rather than take the time
to refill them with American farm
products.
It’s simple economics: Because
a container of Chinese electronics,
apparel and other exports is gener-
ally worth more than one filled with
American farm products, shippers
can charge more per eastbound con-
tainer load, says Peter Friedmann
with the Agriculture Transportation
Coalition in Washington, D.C.
For that reason, it’s more prof-
itable for carriers to speed that
container back to Asia for another
high-value load than it is to wait for
several days while a U.S. exporter
fills the container with hay or ap-
ples or some other low-value prod-
uct. Pound for pound, the value of
American apples or potatoes “is a
mere fraction of the value of a con-
tainer load of, say, Adidas running
shoes,” Friedmann says.
That imbalance has meant more
empty cargo containers leaving the
ports of Seattle and Tacoma: In Jan-
uary 2020, just 37% of the contain-
ers exported from Seattle and Ta-
coma were empty, according to NW
Seaport Alliance figures. This Janu-
ary, just over half went back empty.
Due to the greater weight of Ameri-
can exports, outbound ships always
carry some empty containers.
For exporters in Washington and
elsewhere in the U.S., that east-west
imbalance has created massive rip-
ples up and down the exporters’
supply chain.
See Exports / A13
Umatilla
tribe official
could lead
National
Park Service
BY ANTONIO SIERRA
East Oregonian
A longtime administrator
with the Confederated Tribes
of the Umatilla Indian Reser-
vation has been tapped for a
job with broad influence over
regional en-
ergy and en-
vironmental
conservation.
But an even
bigger job
could be in
store for him.
Sams
The tribes
announced
March 8, that Chuck Sams was
leaving his role as the interim
executive director of the tribes
to fill a seat on the Northwest
Power and Conservation Coun-
cil. Gov. Kate Brown appointed
him to the council, but she’s also
backing him for another ap-
pointment: a job in the Biden
administration as the director
of the National Parks Service.
According to Sams, 50, the
offer for his latest job came out
of the blue.
See Sams / A13