Port of Seattle slowdown affects Anderson Hay locally

Simone Corbett, Staff Reporter


For months, the Port of Seattle slowdown has left a major impact on hay and agricultural disputers throughout the west coast.

Negotiations between the Pacific Maritime Association (PMA) and the International Longshore and Warehouse Union (ILWU) began the “friction” that caused a slowdown at the Port after contracts expired in early summer 2014. With expired contracts, the labor union needed the port operators to establish new conditions, but neither group could come to an agreement.

“There was just bad friction and debating that crippled the operations of the port and caused slowdowns,” Mark Anderson, CEO and president of Anderson Hay, said. “A lot of the dysfunction began as we approached October.”

As the oldest international supplier of hay worldwide, Anderson Hay experienced firsthand the economic impact of the slowdown at the Port.

“From November to February, we were invoicing 50 percent of what we could’ve been. At a high volume, low margin business, that doesn’t work very well economically,” Anderson said.

Various trucking companies throughout the region also experienced a tremendous impact from this slowdown.

“During that time, a lot of truck drivers weren’t able to get any work because they weren’t able to go back and forth to the port,” Anderson said. “As a hay industry, there was as much as $60 million a month in lost sales up and down the whole west coast.”

While many frame the negotiation issues as a labor dispute, Anderson said he believes these problems are not just about labor alone.

“We have public facilities that are operated by global companies, that can’t come to terms with the people that work there,” Anderson said. “That’s a broken system that’s costing our economy billions of dollars.”

Anderson said there had not been a negotiation issue for 12 years before this conflict arose. Politicians and lawmakers are now faced with tremendous pressure to make sure a problem like this doesn’t happen again.

State senator Judy Warnick has been actively leading resolutions at the state level. Warnick said because company negotiations are not open to the public, there was nothing the state senate could do to help control the issue between PMA and ILWU.

“The frustrating part for me was that we couldn’t do a thing about it. It’s a frustrating situation to be in,” Warnick said. “The only way we could get involvement in the dispute was from President Obama.”

At the end of January, a letter was addressed to President Obama asking him to intervene. Warnick said she wished the president would’ve intervened much sooner. However, she believes the letter did help speed up the process to get the labor union and operators to come to a conclusion.

In recent weeks, PMA and ILWU finally established terms and conditions to settle on a five-year contract. However, it is predicted to take months for the labor companies to get back into normal operations and make up for the congestion that the slowdown caused.

“Some claim it may take a month for Seattle [and] Tacoma to get back to normal. It may take as long as three months for Los Angeles, it’s going to take some time,” Anderson said.

Because of this lengthy recovery, the costs are increasing, Anderson said.

“In our industry, there’s a lot of hay that won’t be shipped by the time new crop comes,” Anderson said. “There’s a tremendous amount of costs associated with not getting product invoice, and product being delayed.”

Another challenge companies such as Anderson Hay are facing is recovering their market image with their trading companies around the world.

“It’s going to take a long time to clear out containers at the port,” Warnick said. “Long term, the effect is going to be devastating if they can’t keep the contract with the people who are buying their hay.”

Warnick explained that the loss of international customers has been one of the biggest concerns for Ellensburg and surrounding areas.

“There was starting to be an impact   on companies that import goods because goods were sitting on ships and never leaving,” Warnick said.

Anderson said trucking companies in the Ellensburg community and employees of those companies have been hit particularly hard by the slowdown because the dispute has left them out of work.

“There’s a lot of hay exporters in the community that provide a lot of jobs and buy a lot of services,” Anderson said. “If you look at hay exporters and trucking companies in this community and farmers that live here, that’s really what drives this community other than Central. It’s a huge, huge impact.”

Brandon Wilber, supply chain major, said that with Seattle being the main port for the transporting of goods throughout the west coast, it’s easy to see the huge impact the slowdown has had.

“We get everything shipped over from the port, and the slowdown has made it more expensive for goods to get shipped back and forth,” Wilber said.

Wilber said that while on a tour at Pearson Packaging, the company said they might lose $2 million per customer because the slowdown has prevented them from getting their machines shipped to China.

Warnick said she believes it is important for students going into the agricultural field to understand the impact of this type of issue.

“You could be doing your job as a farmer and producer of products, then to have your goods stopped at the borders of other countries is very frustrating. It feels like it’s out of your control,” Warnick said. “It’s important to watch those situations and be aware of them.”