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Shipping reform bill could pass in June

Ag groups urge passage of Ocean Shipping Reform Act as ag exports lose out on $25 billion in sales.

Jacqui Fatka

June 13, 2022

3 Min Read
Port backups GettyImages-1341617364.jpg
PORT CONGESTION RELIEF? Container ships are anchored by the ports of Long Beach and Los Angeles as they wait to offload on September 20, 2021 near Los Angeles, California. Amid nationwide record-high demand for imported goods and supply chain issues, the twin ports of Los Angeles and Long Beach are currently seeing unprecedented congestion. Mario Tamo - Getty Images

U.S. House Majority Leader Steny Hoyer, D-Md., said the House will vote in June on the Senate’s version of the Ocean Shipping Reform Act, which addresses longstanding supply chain issues and shipping port disruptions. More than 90 agriculture and business organizations signed a letter to Senate and House leaders, urging Congress to approve a final bill and send it to President Biden for his signature.

The Senate approved its version of the OSRA in late March; the House passed its bill in December. U.S. exporters and importers have for several years been dealing with port problems, including aging infrastructure, and shipping issues, such as excessive detention and demurrage fees charged to exporters and importers for use of marine terminal space and shipping containers.

American Farm Bureau Federation President Zippy Duvall as well as the CEOs of retail stores Jo-Ann Stores and Tractor Supply Co., spoke with President Biden June 8 and discussed several challenges farmers and ranchers are facing and the importance of final Congressional action on the Ocean Shipping Reform Act to address the backlog at our ports. Championed by Sens. Amy Klobuchar, D-Minn., and John Thune, R-S.D., and Reps. John Garamendi, D-Calif., and Dusty Johnson, R-S.D., the Act will empower the Federal Maritime Commission to crack down on excessive fees charged by carriers and ensure our farmers and ranchers are treated fairly.

“I had a good discussion with President Biden today about several issues, including the importance of the Ocean Shipping Reform Act to America’s farmers and ranchers. He wholeheartedly agreed that we must get past the bottleneck at our ports to get America back on the move and that means breaking the logjam on Capitol Hill,” Duvall said in a statement. 

Duvall notes he told the President that estimates suggest that farmers have lost more than $25 billion in agricultural exports over the past six months due to ocean shipping constraints. “That’s unacceptable,” Duvall says.

The White House says with some shipping companies raising their prices by as much as 1,000% during the pandemic, higher shipping costs are being passed on to consumers and small businesses, which has already driven up costs and could further drive up consumer prices by a full percentage point over the coming year.

The letter from the agricultural organizations add that currently shipping alliances maintain large percentages of market share and operate with the protection of antitrust immunity. Members of these alliances fail to provide timely vessel bookings and equipment and they assess extremely high rates and increasing demurrage charges when bookings are secured. They also refuse to negotiate commercial terms and solutions with their customers. Importers and exporters continue to face unreasonable business practices which OSRA seeks to address.

“Key to this is strengthening the role of the Federal Maritime Commission to address unreasonable demurrage and other charges, which have caused skyrocketed prices through the pandemic and have raised costs for everyone,” the letter explains. “Promptly reaching a final passed, and enacted OSRA bill will address current market conditions, made worse due to the pandemic, by helping to ensure U.S. competitiveness and reduce inflation, and lead to continued economic recovery.”

“The President thanked farmers and ranchers for weighing-in on the need for reform, and I assured him that we will continue pressing hard for passage of a final bill now that both Houses of Congress have cleared versions of it with overwhelming bipartisan support,” Duvall says.

The National Pork Producers Council is asking pork producers to urge their representatives to vote in favor of the OSRA legislation (S. 3580). Lawmakers may be reached through the Capitol switchboard at (202) 225-3121.

Duvall says he also discussed with the president the uncertainty farmers and ranchers are facing with limited supplies and skyrocketing prices of the fuel and fertilizer needed to grow food. “President Biden assured me he knows farmers are hurting and he's interested in learning more. He invited me to bring some folks to the White House so we can roll up our sleeves and work together to address the challenges facing farmers and ranchers,” Duvall says.


About the Author(s)

Jacqui Fatka

Policy editor, Farm Futures

Jacqui Fatka grew up on a diversified livestock and grain farm in southwest Iowa and graduated from Iowa State University with a bachelor’s degree in journalism and mass communications, with a minor in agriculture education, in 2003. She’s been writing for agricultural audiences ever since. In college, she interned with Wallaces Farmer and cultivated her love of ag policy during an internship with the Iowa Pork Producers Association, working in Sen. Chuck Grassley’s Capitol Hill press office. In 2003, she started full time for Farm Progress companies’ state and regional publications as the e-content editor, and became Farm Futures’ policy editor in 2004. A few years later, she began covering grain and biofuels markets for the weekly newspaper Feedstuffs. As the current policy editor for Farm Progress, she covers the ongoing developments in ag policy, trade, regulations and court rulings. Fatka also serves as the interim executive secretary-treasurer for the North American Agricultural Journalists. She lives on a small acreage in central Ohio with her husband and three children.

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