CHICAGO Aug 8 U.S. grain shipments out of the
largest terminal in the Pacific Northwest are facing major
delays as grain inspectors remain off-site because of a labor
dispute, and concerns are growing that the backlogs will get
much worse when bumper harvests roll in.
United Grain Corp, which owns the terminal at the Port of
Vancouver, entered August with nearly 20 million bushels of
grain on the books to ship this month. That included 2.8 million
rolled over from July as it struggled to meet commitments after
state officials stopped inspecting grain on July 7.
"We have supply backing up into the supply chain just as the
wheat harvest peaks and creates choke points for everybody,"
said Pat McCormick, a spokesman for the Pacific Northwest Grain
Handlers Association, which includes United Grain.
"And with the harvest coming on, there isn't a whole lot of
capacity at other terminals," he added.
The Port of Vancouver in Washington state is the largest of
nine grain export facilities on the Pacific Northwest and moves
nearly 20 percent of the region's grain exports and more than 40
percent of the grain destined for Japan. About a quarter of all
U.S. grain exports are shipped out of the Paciifc Northwest,
second only to the Gulf.
United Grain, a unit of Japanese trading house Mitsui
, essentially stopped normal operations last month when
the state government withdrew police protection for inspectors
to cross the International Longshore and Warehouse Union (ILWU)
United Grain and the union have been in an 18-month standoff
after the two sides hit an impasse in contract negotiations.
The company has asked the federal government to supply
inspectors, but the USDA has declined so far. In a letter to
United Grain on Thursday, the USDA said the situation "does not
ensure that FGIS inspectors will have safe access to the
United Grain and the union will next meet on Sunday and
The company met most of its export commitments last month by
securing inspection waivers from customers and the USDA, as well
as shifting scheduled vessels to other export terminals,
shipping more than 9 million bushels overseas.
But concerns are mounting that the situation could worsen as
record-large corn and soybean harvests arrive beginning in a few
"Last year, when we got to September/October/November, we
saw more corn and especially soybeans coming into the Portland
area to be exported to China. If you take out United Grain -
that's less capacity available to export wheat," said Pearson
Burke, a grain merchant for AgVentures NW in Odessa, Washington.
"We're nervous as to what's going to happen down the road,"
(Editing by Jonathan Oatis)