UPDATE: California Cargo Situation Improving
Freight flow in Southern California is back to normal, while talks are underway to end the action in Oakland
LOS ANGELES - 05/07/04 - The overall movement of cargo in and out of California's deep-water ports has improved considerably over the last few days as the flow of cargo moving in and out of the ports of Los Angeles and Long Beach has returned to normal after a week-long "wildcat" action by independent truck owners reduced port operations up and down the state at times to a mere sputter.
But the work slowdown in Northern California is continuing as talks are underway to put an end to an action that has effectively brought container terminal operations at the Port of Oakland to a virtual standstill.
The state-wide action was initiated by about 600 independent owner/operators protesting the rising cost of diesel fuel and what was originally seen as the failure of some ocean carriers and terminal operators to pay a surcharge to offset the increasing cost of diesel fuel, which has risen in the past few weeks to as high as $2.50 a gallon in California - as much as 56 cents a gallon higher than the national average.
But, according to informed sources, the focus of the work slowdown is actually the perceived failure by some of the trucking companies to pass along the surcharge they collect from the ocean carriers and terminal operators to the independent truckers that they hire to haul containers in and out of the Port of Oakland.
"Virtually all of the terminal operators and ocean carriers pay the surcharge, but some of the trucking companies simply aren't passing the surcharge along to the independents," said one source close to the issue, who asked not to be identified.
Yesterday evening the Port of Oakland, acting as an intermediary, called representatives of the trucking companies and representatives of the owner/operators together to discuss the "wildcat" work slowdown.?
Those discussions will continue "until the situation is remedied," the source told the CalTrade Report, adding that "this is too important to be allowed to go on much longer."
Oakland - the fourth busiest container port in the US and served by 32 ocean carriers - handled a record 1.92 million containers last year, a 13% increase over the volume that passed through the port's 10 active container yards and two near-dock rail facilities in 2002.
The Union Pacific Railroad (UPRR) will continue "indefinitely" its embargo of containers moving through its intermodal rail terminals at the Port of Oakland and Lathrop, located near the Port of Stockton.
The railroad, which is the primary rail service provider in the Bay Area, maintains intermodal terminals in Oakland, Stockton (Lathrop), Long Beach, and Los Angeles.
According to John Bromley, a spokesman for the Omaha-headquartered UPRR, the cargo embargo will be lifted "as soon as the situation is resolved."
The Lathrop intermodal facility is one of the largest and busiest in the railroad's 4,000 mile network with an annual capacity of 220,000 trailer-on-flatcar (TOFC), Container-on-Flatcar (COFC), and DST (Double-Stack) "lifts," and serves as the primary consolidation point for container trains moving between Northern California and Chicago, Atlanta, and the northeast US.
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