West Coast Dispute Sees Casualties as Container Lines Cease Freight Services

US – As cargo operations appear to return to normal on America's West Coast following the recent dock workers dispute, the International Longshore and Warehouse Union (ILWU) has come under some heavy criticism from port operator International Container Terminal Services (ICTSI), after Hapag Lloyd announced that it has ended calls at ICTSI’s Portland, Oregon terminal in order to improve schedule integrity. The loss of Hapag Lloyd from the port's container/breakbulk freight facility adds to the mounting woes ICTSI faces as it tries to find new shipping companies to fill the void left by the other box freight lines after they cancelled sailings to Portland earlier this year.

In 2010, ICTSI signed a 25-year lease with the Port of Portland for operation of the container/breakbulk facility at Terminal 6. ICTSI established ICTSI Oregon, Inc. to operate the 78 hectare Terminal at the Port’s Rivergate Industrial District, and took over operations in 2011. ICTSI have had a tumultuous time operating in Oregon with the dispute having started in 2012 when a disagreement arose between the ILWU and ICTSI Oregon over who had the responsibility for plugging, unplugging, and monitoring refrigerated containers, a role historically undertaken at the Port of Portland by workers represented by the International Brotherhood of Electrical Workers (IBEW).

Since 2012, and despite two separate National Labour Relations Board judges ruling against the ILWU for its actions, the ILWU has engaged in work stoppages and slowdowns in what one judge said was an effort to force the Philippine based ICTSI to abandon the port. As a result, the relationship between the ILWU and ICTSI and the Pacific Maritime Association (PMA), of which ICTSI is a member, deteriorated and with Portland achieving the lowest vessel productivity of any container terminal on the West Coast.

Hanjin Shipping pulled out of its container operations involving Portland, earlier this year in February. It was the largest container carrier offering service via Terminal 6, Oregon’s only deep draft international container terminal. Previously, in December 2014, Hamburg Süd announced that it was to remove the port from its sailings, eventually making its last call in February 2015. With the three shipping lines now omitting Portland from their schedules, Westwood Shipping Lines remains the only container carrier calling at the port. These cancellations obviously haven’t gone down well with ICTSI Oregon, which in a statement, criticised the actions of the ILWU saying:

“Attracting new business will be a challenging task. For Terminal 6 to be successful, the ILWU must signal to potential container shipping lines that its almost three-year campaign of work stoppages, slowdowns, and safety gimmicks at Terminal 6 has come to an end. While ICTSI Oregon will continue efforts to attract new customers, no carrier will want to make a long-term commitment to the terminal so long as ILWU workers delay cargo and vessels as a strong-arm tactic to get what they want. We hold the ILWU fully accountable for its actions; therefore, it is imperative that the ILWU leadership in San Francisco publicly commit that its efforts to interfere with productivity in Portland are over.”

Despite these challenges, ICTSI Oregon has affirmed that it is committed to this region and will forge ahead to seek new direct container service to Asia and Europe, saying that retaining and attracting new carriers to Terminal 6 is its highest priority. In its statement, ICTSI continued:

“We are reviewing all options and taking prompt action to generate new business. There is substantial market demand for exporting and importing goods to and from Asia and Europe through Terminal 6. As a result, we are taking calculated steps, in conjunction with the Port of Portland, toward seeking new carriers that can capitalise on the opportunities to serve this valuable market created by Hanjin’s and Hapag-Lloyd’s departure.”

Photo: Some estimates say between them Hanjin, Hamburg Süd and Hapag Lloyd supplied around 99% of the freight passing through Terminal 6. The Westwood Columbia, named after the river on which Portland sits is seen here sailing in the shadow of Mount Fuji as the last international box carrier with services to the Oregon port maintains freight schedules.