A US longshore union representative has laid the blame for supply chain woes across the country on foreign companies, including shipping lines and terminal operators, that have failed to invest in staff.
Frank Ponce De Leon, coast committeeman at the International Longshore & Warehouse Union coast longshore division, told the US House Subcommittee on Coast Guard and Maritime Transportation that foreign conglomerates were more interested in short-term profits than benefiting the US economy.
“Make no mistake, the shortage of containers and delays in goods movement are a direct result of rent-seeking by the foreign conglomerates who lease the vast majority of America’s marine terminals – terminals that are, in fact, mostly publicly owned,” he said.
The ILWU official, a longshoreman for nearly 40 years, said he did not question foreign companies’ right to make profits, but said their margins were based on taxes paid by US citizens to dredge, build and maintain ports, terminals and other infrastructure.
He explained that the ILWU believes: “We have a responsibility to ensure that our national freight supply chain is used to benefit all Americans including the port workers the ILWU coast longshore division represents.”
The union also voiced what many shippers had suspected all along, that the demurrage and detention charges originally designed to maintain the flow of containers into and out of a port, have more recently become “a profit centre for the carriers and terminal operators”.
The ILWU says the vessel operators have increased their fees annually even during the pandemic.
“Larger-volume shippers can often avoid the fees, due to preference handling provisions in their contracts that grant priority movement of that shipper’s containers. This premium service is yet another profit centre for carriers, but also complicates and slows the overall processing of cargo,” concluded Mr Ponce De Leon.