Ag Groups Urge Biden to Act Now on Unfair Ocean Carrier Practices
With more than 20% of agricultural production going abroad, over 70 agriculture associations urged President Joe Biden to address ocean carrier practices that are causing increased costs and delays for American businesses.
Despite some positive steps forward by the Administration, the groups delivered a letter on Sept. 13 to Agriculture Secretary Tom Vilsack, Transportation Secretary Pete Buttigieg, Chair of the Council of Economic Advisers Cecilia Rouse, U.S. Attorney General Merrick Garland and Federal Maritime Commission (FMC) Chair Dan Maffei, urging immediate action and saying, “the problem not only persists, but is becoming more dire.”
Carriers are increasingly declining or cancelling export cargo bookings, while frequent ship delays and cancellations with little or no notice to exporters, is delaying shipments by weeks or even months. The resulting inability of shippers to deliver their products on schedule affects the reliability of American exports, and subsequently decreases export values and market share, the North American Meat Institute (Meat Institute) said in a release.
The letter spelled out steps the Administration and FMC could take to hold ocean carriers accountable for their actions that are not only burdening American workers, but also presenting companies with unprecedented, onerous costs and logistical challenges.
“The cost to ship a container has increased between 300 and 500 percent in the past 2 years; U.S. producers are losing from 10-40 percent of their export value to these added costs; an informal survey suggests that U.S. agriculture exporters’ inability to perform is leading to a loss of 22% of their sales,” the organizations wrote in the letter.
Recommendations include establishing an interagency working group focused on facilitating agricultural exports and providing Federal support for deployment of port and national data-sharing portals, among other suggested steps, the release said.
On Sept. 13, the Meat Institute also expressed its strong support for the Ocean Shipping Reform Act of 2021 by signing a letter to U.S. Congressmen John Garamendi (D-CA) and Dusty Johnson (R-SD), who introduced the legislation last month. If passed, the legislation, among other things, would prohibit ocean carriers from unreasonably declining export cargo bookings if the cargo can be loaded in a safe and timely manner and would require that carriers comply with the FMC’s Interpretive Rule on Demurrage and Detention, the release said.
"Problems obtaining ocean containers of any kind combined with difficulty securing vessel space at fair and reasonable prices, are jeopardizing livelihoods and economic recovery. The attention given these unreasonable practices and the reforms proposed in OSRA21 are critical to reversing those challenges facing not only U.S. exporters but also U.S. businesses that rely on imports," the associations said in the letter to Garamendi and Johnson.
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