A contract dispute that is disrupting port operations in California has already dealt a serious blow to the state’s citrus industry.
“The port disruption has cost growers and shippers about $12 to $15 million just since late October,” said Bob Blakely, vice president of California Citrus Mutual in Exeter. “This could end up being as bad as a freeze.”
Losses are in the form of reduced volume and canceled sales.
Blakely’s comments came during an interview after listening to a representative of the Port of Long Beach update the labor dispute during the annual conference of the California Citrus Quality Council in Visalia.
Gina Barro, business development manager for the port, said the dispute involves talks to renew a six-year contract that ended in June between the International Longshore and Warehouse Union and the Pacific Maritime Association.
Deterioration of fruit
Blakely said from 25 percent to 30 percent of the state’s fresh citrus is exported. The slowdown in shipments has led to reduced hours for laborers and the risk of accelerated maturity causing fruit to deteriorate.
One of Blakely’s concerns is that the slowdown will cut into the state’s market share abroad. The quality council concentrates on opening and retaining trade for California citrus.
Blakely said importers in China are seeking citrus from countries other than the United States to make up for lowered shipments from the United States.
“Once you lose market share, it’s hard to get it back,” Blakely said, adding that “containers need to be on the water now,” with a major sales target, the Chinese New Year, coming in late February.
Dusty Ference, director of grower services for Citrus Mutual, said the slowdown in exports forces more fruit onto the domestic market, which drives down prices here.
Blakely said Citrus Mutual President Joel Nelsen has been conferring with the governor’s staff about the issue, both of the state’s U.S. senators are pressing efforts to “keep perishables moving,” and 39 members of the California legislature have sent a letter to the union and maritime association urging a quick resolution of the contract dispute.
The letter stated support for a move to use the Federal Mediation and Conciliation Service to help resolve issues.
Struggling to keep up
Speaking by phone to those at the Visalia meeting, Barro said staff and workers at the port, the second busiest on the West Coast, are struggling “to keep up with larger ships.”
She said there appeared to be some headway in negotiations concerning inspection of chassis on trucks at the port. Still unresolved are issues of wages, pensions and the length of a new contract. There had been two, six-year contracts since 2002, but three-year contracts are more common.
Barro said the port is trying to accelerate loading and unloading of containers by taking steps that include modifying what had been termed a “Pier Pass” approach aimed at cutting down on truck traffic during the day. She said the approach, expected to be reformed, had resulted in a switch to night deliveries “that caused drivers to line up.”
Another challenge is the manner in which some incoming vessels are loaded, combining truck and rail cargo in a way that makes it cumbersome to separate them.
Alan Dowdy, assistant deputy administrator of the U.S. Department of Agriculture’s Animal and Plant Health Inspection Service, said the top markets for U.S. citrus are Canada, South Korea, Japan and Hong Kong. Among his agencies priorities, is making sure that markets including China remain open to U.S. fruit.
Dowdy said he would like to see more U.S. exports allowed to go to parts of the European Union where citrus is not being produced.
He believes the Trans-Pacific Partnership, now being negotiated among 12 Pacific Rim Countries, could boost U.S. exports of citrus.
Dowdy said more restrictions are being put in place as countries develop increasingly sophisticated approaches to phytosanitary issues.
Jim Cranney, president of the council, said another trade barrier is food safety and potential response to a domestic outbreak that could amount to “over reaction” and global recalls. He cited as an example the reaction by some to a caramel apple recall in the United States.
Cranney said a key mission of the council is to collaborate with research leaders to solve market access problems that deal with pesticide use and such pests and diseases as Phytophthora, Fuller rose beetle, bean thrips and mites.
The council presented the Albert G. Salter Award, which honors outstanding contributions to the industry, to Joseph Smilanick, a consultant who was formerly a plant pathologist at USDA's San Joaquin Valley Agricultural Sciences Center in Parlier.
Smilanick was honored for his postharvest research and work with packinghouses in addressing postharvest decay and the biology and control of postharvest pathogens.