It won't take long for the port strike along the East and Gulf coasts to affect consumers. Bloomberg's Laura Curtis talks with longtime fruit importers in Port Washington, New York, about what it means for the citrus in your grocery cart. Plus: Why the mom lugging orange slices to soccer games this weekend is using a Bogg bag. If this email was forwarded to you, click here to sign up. In a typical week, Peter Kopke imports hundreds of containers filled with clementines, grapefruits, navel oranges and lemons on huge vessels that arrive in the US weekly from South America and South Africa. The citrus gets unloaded at the Packer Avenue Marine Terminal at the Port of Philadelphia and trucked to a warehouse, where hourly workers pack the fruit into 3- or 5-pound bags. Then it's trucked to Costco, Target and Walmart stores across the country. But about $10 million worth of fruit for the company William H. Kopke Jr. Inc.—and all the other container cargo, including auto parts, building materials and medical supplies bound for ports on the East and Gulf coasts—is sitting in vessels offshore or in limbo along the journey, waiting for a deal to end to the first dockworker strike in almost 50 years at maritime gateways from Boston to Houston. "The fruit is detained by the strike," Kopke says. Depending on how long it lasts, he faces extra fees to keep the refrigerated containers plugged in on ships. Even if the fruit doesn't spoil, he's out the hundreds of thousands already spent to get it here—making his business one among many threatened with major losses. The Packer Avenue Marine Terminal, where Kopke's fruit normally arrives. Photographer: Bloomberg Consumers rarely have to think about how their fruit—and toilet paper and medicine—gets from a field or factory to a store shelf. But the strike, which began this week, imperils about half of US ocean shipping. The International Longshoremen's Association and the US Maritime Alliance haven't made much progress on ending the impasse in contract negotiations, which is as much about union demands to restrict automation as it is a dispute over how to split the windfall profits made by shipping lines during the pandemic. The politics are just as fraught as the economics. Just weeks before a knife-edge election, President Joe Biden has backed the union over the foreign-owned cargo carriers, saying he won't use his authority to break a strike. Republican presidential candidate Donald Trump and his Democratic rival Kamala Harris echo the sentiment. The employer group maintains that it's the union refusing to negotiate. There are already ripple effects from the missing fruit. There's no work for truckers who haul containers from the ports to inland hubs, and less work for the fruit packers. When the safety stock runs out, there will be even less. Just three days into the strike, with the supply dwindling and grocery stores canceling promotions they'd planned for October, the Kopkes say consumer prices are already going up. Plus, analysts estimate it'll take one week for every day the ports are on strike to clear the backlog when they reopen. Barring new shipments coming in, William, Peter's son, who's worked at the family business since 2002, says the industry has enough navel oranges to last 5 to 10 days, which means consumers will start encountering bare store shelves in a week and a half. There's even less inventory of grapefruit and clementines, and all of it might run out sooner, anyway. "I heard from one of our retailers that they're seeing some panic buying, like during Covid, when people started buying toilet paper," William Kopke says. His dad is similarly alarmed. "Once the strike ends, it doesn't mean you can get the containers, because the containers will be buried under other containers," Peter Kopke says. "It's going to be a complete nightmare." |
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