Shipment term

Commodity exporters worry about disruptions in shipments to the United States

Image of a commodity export center

Kerala exporters, who primarily target US markets, are keeping their fingers crossed that there will be no disruption to shipments following possible labor protests by the International Longshore & Warehouse Union (ILWU), which controls ports on the West Coast of the United States.

Worried exporting community, which includes coir, seafood, spices, cashew and other commodities, says the situation will get worse if there are disruptions, affecting shipments of several products from India.

According to Mahadevan Pavithran, managing director of Travancore Cocotuft and one of the main coir exporters in Alappuzha, the strike call for a new labor contract is a concern for shippers who are already struggling with the lockdown of the coir network. the supply chain in West Coast ports due to the rise of Covid cases.

Talks with the ILFU, which take place every six years, caused severe labor disruptions and shipping delays during the most recent round, which was in 2014-15. However, there are concerns that the surge in pandemic-related imports has overwhelmed container terminals and this time caused a record backlog of container ships off the ports of Los Angeles and Long Beach, he said. .

“If the strike occurs, US importers and chain store buyers will exercise caution when placing orders with India,” he added. he said. The rise in Covid cases in the US has impacted supply for retailers and chain stores, which are reeling from store closures. Many retailers have not fully recovered from the pandemic and have been forced to limit their purchase orders from India, he added.

“Right now the situation at US ports is bad due to delays and congestion.” If the strike happens, the situation will deteriorate,” said a major seafood exporter in Kochi, adding that the majority of Indian seafood is shipped to Longshore.

Export of nuts and spices

In terms of cashew nut exports, J Rajmohan Pillai, chairman of Beta Group, owner of the Nut King brand, said the strike will have little impact as the majority of the cargo, which is negligible, is destined for the east coast of the United States. The good news is that all other major ports in the United States are not participating in the strike and the government is working quickly to find a solution. “I personally think it won’t happen because the loss to the United States will be too great with inflation at its peak,” he added.

According to a trade intermediary in Mumbai, the strike could disrupt kernel imports to India, especially as traders prepare for the upcoming Diwali season. The strike will cause inventory to build at the point of origin (the US) and there may be selling pressure later.

“At this stage, the strike call has not caused any major disruption in the spice industry,” said the All India Spices Exporters Forum. “However, if not resolved quickly or if it persists, it could certainly cause disruption, particularly for deep sea freight.”