Bold action is needed for California’s clogged ports ByVince Fong andRobLapsley
allowed the problems to intensify. In the long term, sustainable invest- ments must be made in the state’s com- merce infrastructure to increase the ca- pability to efficiently move even more merchandise across the country. Without viable investments, theportswill losebusi- nesses to other states, resulting in the loss of well-paying jobs. The state must also dedicate resources so that manufacturing of goods can return toCalifornia. Without these investments and regula- torychanges, farmerswill suffer losses, and the cost of foodwill continue to increase . Disruptionto theagricultural industry is moreacute than toother sectors. Foodhas a shelf life. If not shipped timely, it rots and becomes worthless. Overseas customers will viewCaliforniaproduceasunreliable, andour farmerswill loseaccess to interna- tional markets, resulting in an estimated annual loss of $21 billion. Like all California businesses, entities in the supply chain including ports, rail, trucking and warehouse operations en- dure layers and layers of state and local laws that have complicated their opera- tions. An evaluation and examination of these regulations is necessary to deter- mine their impact on the supply crisis. Thecurrent situation isdire. Theremust beasenseofurgency totackle thisnational and global crisis that is rippling across ev- ery aspect of theeconomy. Quick thinking and bold action is necessary to not only reduce supply-chain bottlenecks but to strengthen our economic future. (AssemblymanVinceFong,R-Bakersfield, theauthorofAB1679, representsCalifornia’s 34thAssemblyDistrict andmay be contact- ed through his website at ad34.asmrc.org. Rob Lapsley is president of the California BusinessRoundtableandmaybe contacted at rlapsley@cbrt.org.)
Much attention has been paid to the congestion at California’s San Pedro Bay ports that is plaguing our na- tional—and glob- al—supply chain. An intricate and intertwinedsystem moves goods and products around the world through the ports, shipped via rail and truck to warehouse facilities, ultimately arriving at stores and homes. The chokepointswe are seeing through- Vince Fong
Trucks line up this month before piled-high cargo containers at the Port of Long Beach. The vol- ume of ships waiting to unload cargo at Los Angeles area ports is more than five times normal.
ou t t he supp l y chain are being felt by farmers, stores, manufacturers and restaurants in the Central Valley and across California, and will continue into the future. As of this writ- ing, 90 ships in the
farmers are experiencing the fallout. The state’sproductionof fruitsandvegetables— fromalmonds to pistachios to apples and every crop in between—are not being ex- portedat their typical rate. Infact,California farmersareseeinganestimated20%reduc- tion in their export opportunities due to a lack of reliability of ships and bottleneck trafficat ourports. The disruption in the supply chain causedby the crowdedports is complicat- ed. There are no easy answers, but there are answers. Untilmoremanufacturing of goods canbe returned toCalifornia,which is necessary, both short- and long-term solutionsmust be discussed. There is no doubt that Americans have shifted their purchasing habits. But to say that the crisis was just caused by purchas- ing habits during COVID fails to address the entirety of the crisis. Simply focusing onone aspectwill lead topatchwork solu- tions, resulting in another crisis. In the short term, the focus must be onmoving goods quickly and efficiently. Empty containers are clogging the ports;
theymust bemoved immediately to open up needed space and free truck chassis. Hoursofoperationatdistributioncenters must alignwith theports for smoothmove- ment of goods. Owner-operator truckdriv- ers continue to be in legal limbo as the fate of legal challengeshangsover theirheads. Withsomanymovingpartsandentitiesin- volvedinthesupplychain,theremustbebet- tercollaborationandcoordinationtoensure all aspects are functioning as smoothly as possible.Obstacles impactingsupply-chain operations such as faulty regulations and poordecisionsmustbeprevented. Creation of a high-level official at the state level to partner with federal-govern- ment leadership to be the go-to person for all entities involved would ensure the supply chain’s efficiency. Assembly Bill 1679 would establish a high-level advisor to advocate, expedite and swiftly remove hurdles to ensure efficiency and address chokepoints. Thispersonwouldbe tasked tomake sure long-term solutions are im- plemented. The fact that there is not a supply-chain advisor with expertise has
Rob Lapsley
ports of Los Angeles and Long Beach are waiting to be unloaded. Before the pan- demic, about 17 shipswouldbe anchored at anygiventime. Together, these twoports account for 40%of all shipping containers entering the United States, moving more than $400 billionof consumer goods each year. And billions of dollars in goods and merchandise are stuck on these ships. Stores and retailers are struggling to ob- tain everyday items to stock their shelves. Manufacturerswhorelyonpartstobedeliv- eredontimearebeingdisruptedbecauseof inventorydelays. Every itemyoucan imag- inemoves through this supplychain. Exportsarealsoaffected, andCalifornia’s
VOL. 49, NO. 8
February 23, 2022
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