The Korean liner company said it will continue to serve the Pacific Northwest region from Seattle.
Hanjin Shipping said Tuesday its ships will stop calling the Port of Portland, Oregon.
Min Park, a spokesman for the Korean container liner company told American Shipper, “Hanjin Shipping is permanently pulling out of Port of Portland” effective from March 9.
Park said Hanjin will continue to provide service to and from Portland and nearby regions via rail and truck transport to and from Seattle.
The possibility of Hanjin calling Portland at some time in the future is “not known,” she added.
In a letter to customers, Hanjin said the new rotation for its PNH service will be: Ningbo, Shanghai, Pusan, Prince Rupert, Seattle, Vancouver, Pusan, Kwangyang, and Ningbo.
According to ocean carrier schedule and capacity database BlueWater Reporting, fellow CKYHE Alliance members COSCO and Yang Ming also participate in the service. Hanjin operates the service using a half dozen ships with an average capacity of 5,628 TEU.
The decision to end service will have a big impact on some shippers, as has strife in recent years between longshoremen and the operator of Terminal 6 in Portland where Hanjin called.
For example, Shelly Boshart, vice president of BOSSCO Trading, a company that exports straw from grass grown in the Willamette Valley, says five years ago her company was shipping 80-90 percent of its product through Portland. Today it is only 30-40 percent, with the majority of cargo driven to the ports of Tacoma or Seattle for export.
While lower shipping costs through the Washington State ports offset the cost of the longer dray, she said BOSSCO and its trucking arm, Boshart Trucking, have had to add drivers and equipment.
That’s because drivers used to make two to four deliveries per day from BOSSCO’s facility 55 miles south of Portland. Today those drivers can make just one trip to Seattle, and if delayed, they may have to stop at a truck stop or pull over to the side of the road in order to comply with hours of service regulations. If a driver less than 30 miles from home, BOSSCO may dispatch another driver with a pick-up to bring him or her home.
Hanjin called at Terminal 6, the main container terminal at the Port of Portland, which is operated by International Container Terminal Services Inc. The Philippines-based terminal operator won a 25-year contract to operate the terminal in 2010, but has had repeated conflicts with longshore workers at the facility, who are represented by the International Longshore and Warehouse Union.
Last month, ICTSI said, “The ILWU has escalated its efforts against ICTSI Oregon, Inc. as of late, far beyond what other West Coast ports are experiencing. During the busy 2014 holiday season, ILWU engaged in approximately 36 work stoppages and slowdowns of various types and for varying durations. Similar efforts, along with intentional labor shortages, have continued into the first month of 2015.”
ICTSI said those actions continued with the union ordering a 12-hour work stoppage commencing at 7:00 a.m. on Jan. 27 and then walking off the job without notice at 1:15 p.m. on Jan. 28.
Portland’s Oregonian newspaper reported that on Friday, Feb. 6 and Monday, Feb. 9 the ILWU stopped work at the terminal to protest earlier worker dismissals. With the Pacific Maritime Association stopping ship loading and discharge up and down the West Coast over the weekend, the port was closed for four full days before opening Tuesday.
ICTSI said last month productivity at Terminal 6 was “well below acceptable historical levels. In May 2012, prior to the labor dispute which arose in June 2012, ILWU labor was producing approximately 24.8 moves per hour. However, in the last quarter of 2014, ILWU labor was producing at only approximately 13.2 moves per hour — a roughly 47% reduction.
“This level of production is far below industry as well as Terminal 6 standards,” said ICTSI.
The ILWU said in a statement today that “Hanjin’s stated departure from Portland rests solely on ICTSI’s inherent refusal and failure to nurture customer relations. ICTSI’s only interest is to leverage its regional monopoly for maximum short term and unit company profit. Its customers are secondary.”
In 2013, ICTSI was involved in a prolonged battle with the ILWU over whether it or members of the International Brotherhood of Electrical Workers (IBEW) had the right to plug in and unplug refrigerated containers.
A deal brokered by Oregon Gov. John Kitzhaber gave that work to the ILWU. But then last August, the Port of Portland terminated the reefer contract that had employed ILWU members.
In a letter to the president of Local 8 of the ILWU in Portland, Bill Wyatt, executive director of the Port of Portland, said the port authority had made the decision to return the work to the IBEW because of poor productivity at Terminal 6.
In his letter, Wyatt said that as part of the Kitzhaber deal, the port had temporarily assigned the refrigerated container work to the ILWU “with the expectation that container terminal productivity at T6 would improve to recent historical and acceptable levels.” Instead, he said, “container productivity at T6 has actually declined since the work was temporarily assigned.”
The ILWU complained in 2003, “ICTSI’s labor management model is authoritarian and intimidation-based. The company’s systematic use of employer complaints, legal claims and NLRB charges to threaten and control workers is without parallel historically among Pacific Maritime Association member companies. Worker morale at Terminal 6 is at an all time low.”
Last summer, ILWU Coast Committeeman Leal Sundet said the ICTSI had “duped” the administrative law judge of the National Labor Relations Board into “sanctioning ICTSI’s abuse of the safety standards that have been developed over decades and are designed to protect the men and women who risk their lives daily in this dangerous occupation.”
“Hanjin has been a vitally important and longtime carrier in our market, and this will be a tough loss for our region,” said Wyatt. “We have made every attempt to prevent this outcome.”
Wyatt noted that Hanjin had a presence in the port since 1993 and had contracts with many of the area’s largest shippers. He added that its departure leaves Hapag-Lloyd and Westwood Shipping as the remaining direct calling liner carriers.
According to BlueWater Reporting, Hapag-Lloyd calls Portland on the joint MPS loop with Hamburg Sud, which connects West Mediterranean ports with West Coast North America via the Panama Canal using 11 vessels with an average capacity of 4,255 TEUs. Hamburg Sud, however, does not load or discharge cargo at Portland, despite providing five of the 11 ships.
Westwood calls at Portland on its monthly Japan and South Korea to the Pacific Northwest Service 1 Loop 2, which operates with two 2,048-TEU vessels.
“The Port has a 25-year lease with ICTSI Oregon, Inc. for the container terminal that will remain in place, but there are short and long term impacts of losing a direct call container service,” the Port of Portland said. “More than 900 businesses depend on the port to get their goods to and from international markets, and the Hanjin service supports an estimated 657 direct jobs and $33 million in wages annually.”
The agency said its officials “will remain engaged in conversations with Hanjin Shipping, ICTSI Oregon, Inc., shippers and others to explore potential solutions and next steps.
“We are concerned for local importers, exporters and the hundreds of good family wage jobs that depend on this vital service,” said Wyatt. “It will take considerable effort and cooperation, but we will do our best to recruit a new transpacific service like Hanjin.
Hanjin ends container service to Portland, Oregon
