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International Cooperation Department
Tel.: (+86-21) 65853850-8034
Fax: (+86-21) 65373125
E-mail: ICDept@sisi-smu.org
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Logistics |
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| California ports suffer from higher costs, evolving supply chains: PMSA |
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Date:2019-10-23 Readers:
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PRESIDENT of the Pacific Merchant Shipping Association (PMSA),
John McLaurin, says California's ports have lost market share over the
past decade due to high costs, regulatory uncertainties, and
environmental restrictions, noting the beneficiaries have been ports on
the US East and Gulf coasts and Canada's West Coast.
Addressing the Propeller Club of Los
Angeles-Long Beach recently, Mr McLaurin, however acknowledged
California's ports have reduced harmful diesel emissions more than any
other United States port, and drayage trucks servicing the ports are the
cleanest in the world.
In addition, he pointed out that some costs that beneficial cargo owners
(BCOs) face in California are beyond the control of the ports, such as
high intermodal rail rates compared with those charged by Canadian
railroads, reported IHS Media.
Mr McLaurin urged California's ports and public policy makers to engage
in a "calm, rational, and honest discussion" with members of the
transportation supply chain.
"Until we have the intellectual honesty to admit that the goods movement
industry is valued and provides hundreds of thousands of jobs across
the state, we will continue to chase freight away," he added.
Erosion of market share began with the West Coast port shutdown during
2002 contract negotiations. Those talks, which launched the transition
of West Coast ports from manual operations to the free flow of data via
computers - and eventually in 2008 to the introduction of automated
cargo-handling equipment - were the most contentious contract
negotiations in the US since the Mechanisation and Modernisation
agreement of 1960 paved the way for containerisation at West Coast
ports.
He said that the natural evolution of supply chain logistics in North
America contributed significantly to the loss of LA-LB market share to
ports east of the Mississippi River, where two-thirds of the US
population resides.
However, he also cited an "arrogance" on the part of California ports in
assuming that cargo has to flow through those gateways, and
short-sightedness in failing to grasp early enough the impact that the
canal widening and the opening of the Fairview Container Terminal in
Prince Rupert in 2007 would have on West Coast port competitiveness.
Mr McLaurin was adamant in urging that city and state regulators in
California seek to achieve a balance between the costs involved in
environmental regulations and the impact that "lengthy, litigious, and
tortuous environmental planning and permitting" have on the resulting
costs that are borne by the private sector.
"The goods movement industry is evolving. Are we prepared to embrace this change?" he said.
He noted that Los Angeles and Long Beach calculated that the cost of the
updated Clean Air Action Plan of 2006 and its goals for zero-emission
cargo-handling equipment by 2030 and zero-emission trucks by 2035 is
US$14 billion. The Port of Los Angeles said recently it has already
spent $400 million on environmental programmes since 2006, and the
private sector has invested $2 billion to reduce emissions, Mr McLaurin
noted.
http://www.shippingazette.com/menu.asp?encode=eng
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