STATE
MyEagleNews.com
Wednesday, January 5, 2022
A7
PORT GRIDLOCK
Global shipping crisis snarls agricultural exports, increasing costs and delays
By GEORGE PLAVEN
Capital Press
TANGENT — As conges-
tion at ocean ports along the
West Coast has continued in
2021, Alexis Jacobson has
seen her schedule thrown into
chaos.
Jacobson is the inter-
national sales manager for
BOSSCO Trading, a company
based in Tangent that sells
grass straw from farms around
the Willamette Valley to cus-
tomers in Japan and South
Korea. The straw is used as
feed for beef and dairy cattle.
Under normal circum-
stances, Jacobson spends
roughly an hour a day working
with ocean carriers to ensure
their cargo makes it aboard
ships bound for Asia.
That was before COVID-
19 inflamed a nationwide
shipping crisis that has snarled
ports, catapulted costs and left
agricultural exporters scram-
bling for options.
“We’re constantly making
a plan, and then changing that
plan because of circumstances
out of our control,” said Jacob-
son, who now spends most of
her time each day calling audi-
bles whenever a vessel is late
or the booking is canceled.
Timetables are constantly in
flux, and often change with
only a few days’ notice.
Ag exports impacted
BOSSCO Trading is hardly
alone. Just about every North-
west farm exporter — from
Oregon hazelnuts to Washing-
ton apples to Idaho potatoes
— is feeling the pinch.
Shipping containers that
once sat on the docks for 3 to 8
days are now waiting a month
or longer to be loaded onto
vessels, depending on their
destination.
In some cases, carriers are
foregoing Asia-bound exports
altogether, opting instead to
send empty containers back
to Asia, where they are loaded
with higher-priced merchan-
dise such as clothing, foot-
wear and kitchen appliances.
Critics of the practice describe
it as a money grab, with the
industry reporting record prof-
its this year of more than $200
billion.
The price of shipping
exports from the U.S. is also
skyrocketing. Jacobson said
general rates that once ran
$400 to $500 per container
are now as high as $2,000 to
$2,500.
While that added cost can
be tacked onto the prices of
most consumer goods, farmers
are largely price-takers, mean-
ing they cannot pass along
higher costs.
Peter Friedmann, execu-
tive director of the Agricul-
ture Transportation Coalition,
a trade group in Washington,
D.C., that represents U.S. agri-
cultural exporters, said he has
heard from at least one mem-
ber — a hay grower in Wash-
ington — who did not bother
cutting hay for the first time
because he could not get his
product through the ports.
Delayed and canceled ship-
ments hurt agricultural export-
ers in another way, too. Once
international customers turn
elsewhere for products, Fried-
mann said U.S. producers risk
losing them forever.
“If we can’t deliver it
affordably and dependably,
our foreign customers will
go somewhere else,” he said.
“The reality is, there is noth-
ing we produce here in the
U.S. agriculturally ... that
can’t be sourced from some-
where else in the world.”
Experts say the logjam at
ports will likely persist well
into 2022, though new leg-
islation and infrastructure
improvements may help to
alleviate the problem.
‘Self-inflicted wounds’
Friedmann said there
are several “self-inflicted
wounds” that led to the cur-
rent crisis.
Most terminals along the
West Coast, he said, were built
to accommodate smaller ships
that carried 7,000 containers at
a time. Today’s largest vessels
are almost a quarter-mile long
and carry from 18,000 to more
than 22,000 containers.
“There’s no place to store
Rep. Shelly
Boshart Davis
Tom
Bellerud
gestion at Terminal 18,” Bel-
lerud said.
Bellerud said he is not
aware of any other major
port operation bringing this
much new capacity to the
marketplace.
“We’re very proud of
that,” he said.
Port of Seattle
The CMA-CGM Benjamin Franklin arrives in Elliott Bay and prepares to dock at the Port of Seattle.
this stuff when it gets off (the
ship),” Friedmann said. That’s
especially true in cities where
the docks are surrounded by
busy downtown areas.
Friedmann said the U.S.
also has some of the low-
est allowable truck weights
in the world, with California
interstate highways capped at
80,000 pounds gross weight.
Instead of hauling loads in one
or two truckloads, he said it
takes two or three, contribut-
ing to the shortage of chassis
and drivers.
The American Truck-
ing Associations estimated
the driver shortage would hit
a record high of more than
80,000 drivers by the end of
the year.
Although these problems
had been festering in the U.S.
for decades, Friedmann said,
the coronavirus pandemic
brought them to a head in
2020.
COVID-19 caused shut-
downs at ports and factories
in China, which limited the
production and movement
of goods. Meanwhile, more
Americans were stuck at home
and shopping online, amping
up demand for imported con-
sumer wares.
That created the perfect
recipe for delays. Last month,
a record 111 container ships
were anchored off the South-
ern California coast, waiting
to dock and unload their cargo.
“It’s complete confu-
sion,” Friedmann said, add-
ing that carrier service sched-
ules have become “completely
undependable.”
In a recent survey, Agri-
culture Transportation Coali-
tion members reported losing
22% of their export sales due
to supply chain problems.
‘Shipping fatigue’
At BOSSCO Trading,
Jacobson, the international
sales manager, and Shelly
Boshart Davis, vice president
of international sales, say they
are left exhausted.
“There’s this shipping
fatigue that’s really starting
to set in,” said Boshart Davis,
who also serves as a Republi-
can representative in the Ore-
gon Legislature. “We pride
ourselves on being flexible,
but it feels like we’re putting
out fires every day, every hour,
all the time.”
BOSSCO Trading mar-
kets straw from about 40 grass
seed farms around the Willa-
mette Valley.
Once the seed crop is har-
vested, BOSSCO’s crews
arrive to rake and bale the left-
over straw, which then goes
to a hay press in Salem. The
bales are loaded into shipping
containers and sent to ports in
Seattle, Tacoma and Portland
via truck and rail.
Normally, BOSSCO Trad-
ing handles 2,200 contain-
ers in a year. However, Jacob-
son said it is becoming harder
to find containers, as they are
stuck on ships or at docks.
Bookings from some carri-
ers have also been canceled
for months — called “vessel
voids” — leaving products
stranded.
Boshart Davis estimates
their costs are up 100% to
150% between increased rates
and fees, to say nothing of the
mental and emotional toll.
“When you can’t be pro-
ductive and efficient ... it costs
a lot of money when you’re
scrambling all the time,” she
said.
Todd Fryhover, president
of the Washington Apple Com-
mission, said his members are
under similar pressure.
Apples are Washington’s
most valuable agricultural
commodity, with $2.1 bil-
lion in sales in 2020. About
30% of the state’s production
is exported, though Fryhover
said port congestion has pro-
ducers concentrating this year
more on North American mar-
kets as opposed to overseas.
But that also has a cost. For
every 1 million boxes of fresh
apples shifted into the U.S.
domestic market, the price
drops about 50 cents per box
as supply begins to overtake
demand, Fryhover said.
“The entire supply chain
has been affected,” he said.
“It’s not easy to point at one
place and say, ‘Fix this and
everything will be better.’
That’s certainly not the case.”
Increasing capacity
The vast majority of marine
cargo in the Northwest is han-
dled by the ports of Seat-
tle and Tacoma, Washington,
governed by the Northwest
Seaport Alliance. It is the
fifth-busiest container gate-
way in the U.S., behind the
ports of Los Angeles, Long
Beach, New York-New Jer-
sey and Savannah, Georgia.
Tom Bellerud, chief oper-
ations officer for the seaport
alliance, said agriculture is
a dominant exporter in the
region.
Congestion has certainly
hampered the Seattle-Ta-
coma gateway, Bellerud said,
though he sees signs that
pressure may be letting up
somewhat. The number of
ships that were once backed
up in Seattle — albeit not as
extreme as Southern Califor-
nia — is now the lowest it has
been “in a very long time,” he
said.
Bellerud credited a few
factors that have helped to
relieve the bottlenecks.
First, he said both Seat-
tle and Tacoma are utilizing
alternative container yards,
freeing up valuable space on
the terminal docks and allow-
ing products to move more
efficiently. The Port of Seat-
tle identified an additional
40 acres at Terminal 46, and
the Port of Tacoma opened an
additional 20-acre yard.
“We have the luxury of
having some additional land
and space near our terminals
that can offer greater utility to
the overall operations,” Bel-
lerud said.
The biggest upgrade, how-
ever, will be the reopening of
Terminal 5 in Seattle, Bel-
lerud said.
The 185-acre terminal
has been under construction
for several years. It is slated
to go into service in phases
beginning in January, with
more than $500 million in
improvements.
“That will open some
space and relieve some con-
New legislation
Solving the supply chain
crisis is expected to take time,
but agricultural groups are
encouraged by a bill they say
will crack down on shipping
lines’ unreasonable practices
and improve transparency for
exporters.
The Ocean Shipping
Reform Act of 2021 passed
the U.S. House of Represen-
tatives with bipartisan sup-
port on Dec. 8. Lawmakers
have said the bill will ensure
maritime shipping remains
competitive, reciprocal and
protect businesses from price
gouging.
Tracey Chow, federal gov-
ernment affairs specialist for
Western Growers, said the
bill is not a silver bullet, but
as the shipping crisis eases
it will allow the industry to
ensure a level playing field
for agricultural exporters.
“We want the commerce
system to work for both
sides,” Chow said.
For example, Western
Growers — which represents
vegetable, fruit and tree nut
farms in California, Arizona,
Colorado and New Mexico
— has called out the prac-
tice of ocean carriers send-
ing empty containers directly
back to Asia instead of send-
ing them inland to be loaded
with agricultural goods for
export.
Carriers are able to charge
upward of $20,000 per con-
tainer for imports from Asia,
enticing them to skip agricul-
tural exports altogether.
“From a
business per-
spective, it’s
hard to com-
pete
with
that,” Chow
said. “You
can’t
just
Alexis
keep bringing
Jacobson
in imports
and not have reciprocity for
exports to leave.”
The Ocean Shipping
Reform Act would prohibit
carriers from declining U.S.
exports “unreasonably,” as
determined by the Federal
Maritime Commission.
It would also require com-
mon carriers to report to the
commission total import and
export tonnage, and loaded
versus empty containers per
vessel each quarter.
To incentivize efficiency,
Chow said ocean carriers
and ports may charge what
are known as “detention and
demurrage” fees if containers
are not unloaded or returned
quickly. The fees can be as
much as $500 per day per
container.
But with congestion at
the ports, Chow said export-
ers may not have the flexibil-
ity to avoid getting hit with
penalties.
It is typically up to the
invoiced party to dispute
whether these charges are rea-
sonable. The bill would shift
that burden of proof to the
ocean carrier.
“(This crisis) has brought
attention to how imbalanced
the maritime shipping indus-
try is becoming,” Chow said.
“Everybody understands this
is an issue that needs to be
addressed.”
Looking ahead, Fried-
mann, with the transporta-
tion coalition, said the crisis
at ports could drag into 2023
before ocean carriers can pro-
vide more ships and contain-
ers, and demand for imported
consumer goods starts to
abate.
“As long as people are
staying home and buy-
ing these huge volumes of
imported goods, and every-
thing we own and play with is
made overseas, this is going to
continue,” he said.
Committee Volunteers Needed
Grant County is now Recruiting Volunteers to Serve on Active Boards and Committees
Applications are Due by WEDNESDAY, JANUARY 5, 2022
Obtain an Application to Volunteer from the County Court, 201 S. Humbolt, No. 280, Canyon City, OR 97820
Online at Committee Volunteer Application or contact (541-575-0059) GCCourtAdmin@grantcounty-or.gov
Committees are formal public bodies required to comply with Oregon Public Meetings Law ORS 192.610.
College Advisory Board
Seven members plus three ex-officio members serve a three year term and meet monthly to promote local educational
opportunities and identify educational needs within the community.
Extension & 4-H Service District Advisory Council
Eleven members serve three year terms and meet semi-annually to provide guidance and assistance to local OSU
Extension staff in planning, developing, and evaluating balanced educational programs directed to high priority needs
of county residents. Membership is limited to one re-appointment.
Extension & 4H Service District Budget Committee
Members include two advisory members and a member-at-large serving three year terms. Annual meetings include
the County Court and are held to receive, deliberate, revise and approve the annual budget as provided by the District
Budget Officer. Any proposed programs are discussed and considered.
Mental Health Advisory Board
Seven members (including two consumer representatives) serve three year terms and meet no less than quarterly
to facilitate the provision of quality mental health services to county residents and enhance community knowledge
of available programs and services. Acts as the Local Alcohol and Drug Planning Commission and Developmental
Disabilities Advisory Board. The board is a formal public body required to comply with Oregon Public Meetings Law
ORS 192.610.
Planning Commission
Nine members serve a four year term and two alternates serve a two year term, meeting as needed to review land
use and zoning applications and discuss city and county growth issues and siting new facilities. Members must be
residents of various geographic areas within the county and no more than two voting members shall be engaged in
the same kind of business, occupation, trade or profession with agriculture designations of livestock / forage crop
production and horticulture / specialty crop production. Commissioners serving in this capacity must file an Annual
Verified Statement of Economic Interest with the Oregon Government Ethics Commission. Members must re-apply
to the County Court before their term ends if they wish to be re-appointed. The commission is a formal public body
required to comply with Oregon Public Meetings Law ORS 192.610.
Senior Citizens Advisory Council
ORS 410.210. Five members serve three year terms and meet semi-annually to define the needs of older adults,
promote special interests and local community involvement, and represent senior citizens as an advocate to the local,
state and federal government and other organizations.
Sera
The alliance provides a forum for local government agencies and the private sector to discuss, understand and coor-
dinate long range transportation issues affecting the south east Oregon region including Grant, Harney and Malheur
counties. The alliance acts as the Area Commission on Transportation. It reviews the process for determining trans-
portation infrastructure and capital investments in the south east region, recommends priorities, and advises Oregon
Transportation Commission on state and regional policies affecting the region’s transportation system. Five members,
plus one alternate, serve three year terms as Grant County representatives. Daytime meetings are held monthly, or as
needed, at locations rotating among the three counties.
Wildlife Advisory Board
Created by Resolution 1993-29. Nine members serve three year terms and meet as needed to discuss issues re-
garding big game management and make recommendations to Oregon Department of Fish & Wildlife, including tag
allocation and hunting season structure as they relate to population and damage of property.
Wolf Depredation Advisory Committee
OAR 603-019-0015. Members include one County Commissioner, two members who own or manage livestock and
two members who support wolf conservation or coexistence with wolves. These members agree upon two business
representatives to serve as additional members. The committee oversees the procedure established by Grant County
for its Wolf Depredation Compensation Program. The current vacancy is for a business representative.
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