California Exports’ Decline in 2015 1st Since 2009

The West Coast port strikes that caused rotting produce and transportation delays sparked an $8.5 billion decline in California exports in 2015, the first since 2009.

Beacon Economics reported in their 2015 year-end round-up that California merchandise exports fell from $174.13 billion to $165.17 billion in 2015. Beacon found that manufactured goods shipments were down by $6 billion.  Agricultural products and raw materials led the way down with a $2.7 billion decline.

Although the strong U.S. dollar probably had some impact on California competitiveness, the three West Coast port strikes by the International Longshore and Warehouse Union caused the devastating equivalent of about 20 days of lost export loadings in 2015.

ILWU members were already commanding average wages and benefits of about $1,200 a day just before the strikes. But as Breitbart News reported last January, America’s best-paid union members just before holidays would manage to shut down all 29 West Coast ports by organizing 80 percent of heavy crane operators to call in sick.

It appears that union members were setting up employers to be forced to pay double-time for catch-up work on the four union contract holidays over “Lincoln’s Birthday” and “Presidents’ Day.”

Although February each year is a traditionally a slow month for international trade, it is often the biggest month for U.S. farm exports. But export delays for agriculture in the first quarter of 2015 averaged three to four weeks for fresh fruit and vegetables and up to eight weeks for rice.

Sun Pacific Shippers and Farming, the largest navel orange grower in California and largest kiwi grower in the United States, complained that the biggest damage was done to the $1 billion of oranges, lemons and limes that are normally exported to Korea, Japan, China and Australia each year.

Although the company tends to ship 350 containers of fruit worth $6 million a week, Sun Pacific’s President Al Bates told the San Francisco Chronicle that port delays in 2015 cut exports in half. Bates said losses were especially painful to farmers who were already paying premium prices for water during the drought.

Tim Johnson, President and CEO of the California Rice Commission, which represents the state’s 2,500 rice farmers, told the Sacramento Business Journal that as the number of rice export containers built up at port warehouses in early 2015, farmers reduced plantings, which means that this year’s California rice exports will be even lower.

The port strikes also hammered California workers up the agricultural supply chain. West Sacramento-based Devine Intermodal, which moves cargoes by truck for Farmer’s Rice Cooperative, Blue Diamond Growers and other California growers to the Port of Oakland, cut hours by a quarter of his 25 workers in early 2015.

Jock O’Connell, Beacon’s international trade adviser, told the Sacramento Bee that the export slowdown accelerated at year end due to the Chinese slowdown.

California merchandise shipments fell 12.9 percent, from $14.73 billion in December 2014 to $12.83 billion in December 2015. Agriculture exports led the decline with a 17.7 percent plunge.