Coke ships slow as Long Beach halts night shift

Coal and petroleum coke shipments from Long Beach, California, are being affected by a new wrinkle in a contract dispute between west coast shipping companies and the longshore workers union.

The Pacific Maritime Association, which represents companies that operate terminals on the west coast, earlier this week instructed terminals to stop night-time vessel loading and unloading at Long Beach and Los Angeles ports.

The order applies to bulk operations and container shipping, and market participants said that both the Metro Ports terminal and Koch Carbon subsidiary KCBX have eliminated night shifts at Long Beach. Metro had continued loading vessels at night for the first two nights, but said yesterday that it will not work night shifts until further notice.

This will slow petroleum coke and coal exports headed to Asia-Pacific and increase demurrage for shippers.

Long Beach is one of the largest petroleum coke export ports in the US, shipping 4.26mn t of green coke and about 340,400t of calcined coke in the first 11 months of last year, according to the latest US Census Bureau data. It also shipped 1.44mn t of coal over the period.

The Pacific Maritime Association says the order is designed to avoid piling up of containers at the ports, which it claims have built up because the International Longshore and Warehouse Union is withholding qualified yard crane drivers needed to load containers onto trucks for distribution.

"With many terminal yards already at more than 90pc of capacity, there is limited room for additional cargo to be offloaded," the association said. Limiting offloading operations will "enable terminals to focus night operations on clearing existing congestion in the yards." It will also allow the terminals to deploy more crane operators to removing containers rather than bringing more in, it added.

The union counters that by making the order also apply to bulk cargoes, the association is proving that the move is no more than "a cynical tactic to generate anxiety among workers … and create the appearance of a crisis in order to score points with politicians in Washington." Making the cutbacks apply to bulk operations is "illogical," the union said, since the congestion problem is with containers, in particular with a lack of required equipment.

Until now, only container shipping had been experiencing backlogs as a result of the labour dispute, but market participants say this new turn of events will affect coal and coke shipments from Long Beach. More than 10 green and calcined coke cargoes were scheduled to load in the coming weeks, and there is no telling how long it may take for the order to be lifted, potentially slowing or delaying a large number of cargoes.

The two sides have been at odds for eight months as they work to negotiate a new contract to cover workers at west coast ports. A federal mediator joined talks last week, but the parties appear no closer to a resolution.

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