The impacts of a bad reputation

U.S. Labor Secretary Tom Perez talked recently about how a good reputation can trump a good location when it comes to trade. Washington's ports had enjoyed an advantage due to their location as a good access point to and from Asia, but the result of the West Coast ports work slowdown may be that that they are seen as unreliable.

Indeed, the Puget Sound Business Journal writes that

The biggest East Coast ports had 10.2 percent more growth than the biggest West Coast ports in the fourth quarter of 2014, compared to a 1.6 percent difference from the year before. . . .

Some of that diverted cargo will never come back.

"With each labor event, some diverted cargo has not returned, and this seems to be the case for some West Coast ports coming out of this most recent contract negotiation," according to Fitch [Ratings].

Additionally, the story notes,

The Port of Seattle is mostly just a pit stop as goods make their way around the country.

While the Port of Seattle doesn't track exactly how much cargo shipped through the harbor moves outside the state, most of it is shipped elsewhere, said spokesman Perry Cooper.

When cargo isn't staying in Washington state, shippers have less incentive to use Washington state ports when others are more reliable.

In a 2013 report, we looked at the competition faced by our ports and noted that

31 percent by value and 13 percent by weight of all goods exported through Washington ports originated outside of the state of Washington.

On the question of how long it will take for port activity to get back to normal, the PSBJ story says, "it will take no more than three weeks to clear backlog at the ports of Seattle and Tacoma."

The Wall Street Journal writes about one way to get freight moving:

Port terminals are developing new ways to organize cargo at the docks and systems for getting that cargo moving off the docks as quickly as possible. Software developed by a local technology startup called Cargomatic, a sort of Uber for moving cargo around the Los Angeles region, serves as one creative solution.

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