Issue link: https://pma.uberflip.com/i/1495430
Maritime trade and the broader supply chain have confronted extraordinary challenges in recent years. The record-high container traffic during the COVID-19 pandemic gave way to dramatic declines in 2022, when cargo volume reached pre-pandemic lows in the second half of the year. Wide fluctuations in traffic raise three core issues for the future of West Coast ports: 1) capacity constraints of marine terminals; 2) the acceleration of cargo diversion to East Coast and Gulf Coast ports; and 3) the lack of synchronization among all facets of the supply chain. With volumes projected to grow, these challenges add urgency to the need for West Coast ports to expand throughput. In large part, that means enhancing efficiency and productivity through automation, particularly at the Ports of Los Angeles and Long Beach. Growth in throughput, paid hours, and jobs in recent years shows the substantial investment in new technologies has paid off. This modernization push needs to extend to more port terminals and throughout the supply chain. We are also cognizant that dependable labor peace is fundamental to the West Coast ports' long-term economic health. Negotiations for a new coastwise contract began in May 2022, with the prior contract expiring last July. The leadership of PMA and the ILWU had the opportunity to meet privately with President Biden and Labor Secretary Walsh to discuss the status of the talks during a June visit to the Port of Los Angeles. These protracted talks have adversely impacted volumes and cost us market share, as importers increasingly bypass the West Coast in favor of East Coast and Gulf Coast alternatives. The data in this annual report highlights a particularly unfortunate consequence of the cargo diversion: reduced work opportunities for ILWU members. I remain optimistic about the future of West Coast ports. We are the primary gateway for trade with Asia. We have outstanding infrastructure, a world-class workforce, and the ability to lead the way on terminal efficiency. By building on our track record, we can surmount the challenges to strengthen port terminal operations, add reliability to the supply chain, and continue to deliver broad economic and social value to West Coast communities and beyond. Sincerely, James C. McKenna President and CEO TO OUR STAKEHOLDERS 3 PACIFIC MARITIME ASSOCIATION