Mid-Columbia companies deal with losses from port slowdown

Kristi Pihl, April 3, 2015, Tri-City Herald

A backlog of apples, potatoes and other goods is clearing out of the ports of Seattle and Tacoma.

 

Still, Mid-Columbia growers and exporters continue to feel the pains of lost sales and customers created by a lengthy export slowdown.

 

Exports and imports at the ports were slowed for about three and a half months, hitting many Northwest farmers, food processors, manufacturers, retailers, truckers and other businesses tied to international trade.

 

The Pacific Maritime Association and the International Longshore and Warehouse Union reached a tentative five-year contract agreement on Feb. 20.

 

The pact took a big step closer Friday to becoming official, as representatives of the dockworkers’ union overwhelmingly recommended that rank-and-file members vote to approve the deal.

 

Shipping through the ports of Seattle and Tacoma has gotten better, but workers still are trying to move through the accumulated backlog, said Scot Courtright of Moses Lake hay exporter Courtright Enterprises.

 

It may take until May or June for all of that backlog to be moved out of the ports and to its ultimate destinations.

 

There are complications at the ports because of how many containers still waiting to be shipped, Courtright said. Vessels are working on getting back to a more normal schedule after the disruption.

 

Washington farmers, manufacturers, retailers and other exporters will continue to feel the impact of the trade barricade even once a contract is ratified and the backlog cleared.

 

The state’s record-breaking apple crop shrunk slightly because companies are being more selective about what they pack and sell. That has brought last year’s total to about 145.9 million 40-pound boxes, said Jon DeVaney, Washington State Tree Fruit Association president. Earlier estimates put the crop at 154.9 million boxes.

 

The crop decline likely will continue to drop since companies are packing only what they think they can reasonably sell, he said.

 

Apple farmers missed the opportunity to see large increases in exports, DeVaney said. While the volume has increased with the end to the port slowdowns, it hasn’t been by a large amount.

 

Exports are up compared to last year, in part because of customers in Canada, Mexico and Latin America. Overall, about 26.4 million boxes of apples had been exported as of mid-March, compared to 22.1 million boxes during the same months the previous year.

 

But exports only were up 19.5 percent through mid-March compared to the same months the previous year, while the crop size was up 27 percent, he said.

 

More apples are being sold into the processed market, which means a less-profitable crop for Mid-Columbia farmers. Fresh market sales bring in the best prices, but growers will sell to the processed market if they can’t sell the apples in the fresh market.

 

“It’s better to get something for it than nothing,” DeVaney said.

 

It appears Washington frozen potato processors will be back to normal shipping patterns and able to ship last year’s crop before this year’s crop becomes available in July, said Dale Lathim, executive director for the Potato Growers of Washington and the United Fresh Potato Growers of Washington & Oregon.

 

Earlier, there was a concern that an oversupply would lead to less acres of potatoes planted in the Columbia Basin this year. But Lathim expects the potato acreage to be up overall, with declines in fresh potatoes made up by gains in frozen potatoes.

 

“Every grower should have very close to last year’s acreage,” Lathim said.

 

Farmers began planting this year’s potato crop in February, taking advantage of the warm spring weather.

 

Some customers were lost because companies in the state weren’t able to fill the demand for frozen potato products during the port slowdown, he said. They are working to try to get those customers back.

 

And processors did end up missing out on the potential growth for this year, meaning missed opportunities for revenue.

 

The Washington State Potato Commission estimates the missed opportunity for frozen food processors was about $48 million for November through January.

 

Courtright said hay growers didn’t lose customers, but they did lose business that they can’t make up.

 

“This is going to feed livestock, and you can’t make them eat more than they normally would eat,” he said.

 

Two months’ worth of hay didn’t ship because of the slowdown. That hay is still on hand and likely will carry over into when this year’s hay crop is available. Hay has a long shelf life and can last for a few years, he said.

 

It’s likely hay prices could drop as a result, Courtright said. Still, he expects to see more alfalfa hay planted as farmers respond to dropping corn and wheat prices.

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