Roughly six months have passed since the greater west coast trade community returned to work after the ILWU (International Longshoreman and Warehouse Union) and PMA (Pacific Maritime Association) reached a labor contract agreement. In the interim, the Port of Portland and Oregon businesses - whose economic viability depends greatly upon both ILWU and PMA compliance with that labor contract - have suffered from various trade-limiting circumstances.
In addition to long standing labor issues that were magnified by the lack of a contract, other challenges in the local trade environment include, but are not limited to, trucking shortages, container unavailability and residual port congestion. The greater trade environment also presents mounting new challenges to Oregon businesses participating in international trade. The value of the U.S. dollar has increased and continues to gently climb, which restrains the purchasing power of foreign buyers. Global trade routes are also changing from Far East Asia (China, Taiwan, etc.) to farther South East Asia origins (Indonesia, Malaysia, etc.), decreasing the trade lanes landing on the West Coast that bring necessary container supply and vessel service to the region. The upcoming Panama Canal expansion is yet another disadvantage to trade in Oregon, as the expanded canal will bring larger ships that are too big to come inland up the Columbia River to Portland. The challenges are many and deserve more analysis than this blog allows; however, one thing is clear, Oregon businesses are greatly disadvantaged on the international market place.
In the absence of a holistic solution, it is Oregon businesses who have borne a majority of the burdens brought about by these various trade complications. Increased service costs, more often than not, engender the decreased profit margins, which quickly translate to a loss of Oregon jobs. If a one-size-fits-all solution to any portion of these challenges were easy, it would have been implemented by now; the difficulty of providing timely shipping and logistics services within the current trade circumstances cannot be overstated.
Having recognized the multidimensional challenges threatening the health of Oregon trade, this past April, Governor Kate Brown approved the Oregon Trade and Logistics Initiative (OTLI). The state has been given a financial grant to help make imports and exports better for those importers and exporters who were using the Port of Portland for container shipments; the purpose of the OTLI itself is currently acting as a fact-finding mission to determine the best way to use those funds. The intent of the OTLI is to enhance tools already at the disposal of the trade community to identify the most cost-effective alternative transportation options available to importers and exporters during this Port of Portland crisis. Through this initiative, Oregon importers and exporters whose business depends upon the viability of the Port of Portland - which had worsened by the lapse of the ILWU / PMA contract and pending lawsuits - have been invited to offer solution-oriented proposals at the six workshops, which will then be incorporated into recommendations that will be made to the 2016 Oregon Legislature.
The Oregon Department of Agriculture, Oregon Department of Transportation, and the Port of Portland have all partnered with Business Oregon to participate in the Oregon Trade and Logistics Initiative, and they want to hear from you. The first of six Trade Workshops was led by Business Oregon in Portland on Friday July 24th. Over 130 attendees came together to participate. Any person with a vested interest in the long term viability of Oregon trade is urged to participate in one of the remaining workshops listed below:
* Ontario, Oregon // August 10th at 6:30pm
* Albany, Oregon // August 11th at 6:30pm
* Medford, Oregon // August 12th at 6:30pm
Register HERE to attend a workshop near you.
If the logistics required to transport cargo to and from the port is too cumbersome, we all suffer, and we all suffer greatly. Roll up your sleeves, participate in the conversation, and choose to be an active part of the solution. Please extend this invitation to clients and relevant business partners in your network, and encourage others to visit Oregon Trade Solutions for more information. Let's push our industry forward through this difficult time.