Washington—US Secretary of Agriculture Tom Vilsack and US Transportation Secretary Pete Buttigieg on Thursday urged the world’s leading ocean carriers to help mitigate disruptions to agricultural shippers of US exports and relieve supply chain disruptions by restoring reciprocal treatment of imports and exports and improving service.

Ocean carriers have made fewer containers available for US agricultural commodities, repeatedly changed return dates and charged unfair fees as the ocean carriers short-circuited the usual pathways and rushed containers back to be exported empty, according to USDA and the US Department of Transportation (DOT). The poor service and refusal to serve customers is exemplified by many ocean carriers suspending service to the Port of Oakland.

USDA and DOT are calling on the ocean carriers to more fully utilize available terminal capacity on the West Coast.

“The Port of Oakland, Port of Portland, and other West Coast ports have excess capacity to alleviate supply chain congestion,” the Vilsack-Buttigieg letter noted. “Particularly, the suspension of service by ocean carriers at the Port of Oakland earlier this year has required agricultural exporters to truck their harvests to the already heavily congested Ports of Los Angeles and Long Beach.

“While ships must dwell for several days in San Pedro Bay to berth at Southern California ports, other West Coast ports are less congested and berths more readily available,” the letter continued. “Restoration of service would not only ease the congestion at the Ports of Los Angeles and Long Beach in Southern California but would allow the prompt export of American goods overseas and ease the strain on the supply of long-haul truckers necessary to transport goods from Northern California to Los Angeles and Long Beach.

“It is also critical that we restore reciprocal treatment of imports and exports that is inherent in trade,” the letter stated. “Shippers of US grown agricultural commodities and goods have seen reduced service, everchanging return dates, and unfair fees as containers have short-circuited the usual pathways and been rushed to be exported empty.

“This imbalance is not sustainable and contributes to the logjam of empty containers clogging ports,” the letter added. “The poor service and refusal to serve customers when the empty containers are clearly available is unacceptable and, if not resolved quickly, may require further examination and action by the Federal Maritime Commission.”

The letter was sent to Ed Aldridge, president, CMA CGM America LLC; Tenny Hsieh, president, Wan Hai Lines America; Feng Bo, president, COSCO North America; Kee Hoon Park, CEO, SM Line; Benjamin Tsai, president, Evergreen Shipping Agency; Uffe Ostergaard, president, Hapag-Lloyd AG North America; Jeremy Nixon, president, Ocean Network Express; George Goldman, president, Zim American Integrated Shipping Services; Paul Devine, president, OOCL (USA) Inc.; Doug Morgante, Vice president, Maersk Inc.; Fabio Santucci, president and CEO, MSC Mediterranean Shipping Company USA; and Cheng-Mount Cheng, chairman and CEO, Yang Ming Marine Transport Company.

The US Dairy Export Council (USDEC) and the National Milk Producers Federation (NMPF) praised the strong message from USDA and DOT urging the world’s leading ocean carriers to reform their practices to provide better service to US agricultural exporters.

USDEC and NMPF have repeatedly met with USDA and DOT officials as well as the White House over the past several months to urge a greater Biden administration focus on the shipping supply chain crisis’s impact on agricultural exporters. The dairy organizations have urged the administration to call out profiteering by foreignowned carriers at the expense of dairy exporters and take steps to address the supply chain crisis that’s cost the dairy industry $1.3 billion over the first three quarters of 2021.

The Vilsack-Buttigieg letter was a key step in the right direction and builds on last week’s House passage of the Ocean Shipping Reform Act, which is aimed at curbing some of the bad-faith practices by ocean carriers, USDEC and NMPF said. That legislation, which has yet to be taken up by the US Senate, would, among other things, require ocean carriers to adhere to minimum service standards that meet the public interest, reflecting best practices in the global shipping industry.

“Dairy exporters are enduring tremendous challenges in getting their high-quality products to customers in overseas markets, which puts our industry’s reputation as a reliable supplier at risk. Our competitors in the European Union and Oceania are eager to swoop in and scoop up those sales,” said Krysta Harden, USDEC’s president and CEO.

“USDEC commends the administration’s recognition that the current situation facing our dairy exporters cannot continue and strongly supports further steps by the Federal Maritime Commission and other Administration entities to drive change swiftly,” Harden added.

“Dairy farmers and their cooperatives have invested significantly in painstakingly cultivating export markets to help meet the growing global demand for dairy. This year’s shipping supply chain crisis has created enormous upheaval in maintaining those sales, which are so critical to the overall demand for American milk,” said Jim Mulhern, NMPF’s president and CEO.

“Dairy farmers strongly support USDA and DOT’s castigation of ocean shippers’ abusive practices and urge the administration to take the steps necessary to bring about meaningful reforms in export access for our dairy industry,” Mulhern continued.

NMPF and USDEC formed an Export Supply Chain Working Group earlier this year and have worked on a range of initiatives to address the shipping crisis including the passage of the Ocean Shipping Reform Act and work to drive further congressional advancement of this legislation.

Steps by the administration to fully use all existing authorities are a crucial complement to that ongoing legislative reform effort, the dairy organizations said.