“Shipping carriers rejected U.S. agricultural export containers worth hundreds of millions of dollars during October and November, instead sending empty containers to China to be filled with more profitable Chinese exports,” a 2021 CNBC investigation found.
American farmers, ranchers and growers don’t have a shipping container shortage, as has been reported. Foreign shipping carriers are refusing to take American and California-made products, and instead, the shipping carriers take empty containers back to China.
China pays shipping carriers so much money to export Chinese-made goods, they are then paid a premium to carry the empty containers from America back to China. As a result, hundreds of thousands of containers with American products are delayed or remain sitting rotting on American docks in American ports while foreign customers wait.
In the past year, members of congress, the U.S. Secretary of Transportation, the U.S. Secretary of Agriculture, the California State Transportation Agency Secretary, and the California Department of Food and Agriculture sent letters to the shipping council, leading ocean carriers, and Federal Maritime Commissioners. But the export situation has only gotten worse.
What does this mean for California?
California walnut, almond and citrus growers, and meat and dairy producers are facing not only the loss of their food products because so much of the 2021 crop is still sitting in storage in the U.S., but is already sold, and they aren’t getting paid for what was ordered and committed – payments will not be received until the product is delivered.
“California’s walnut industry exported 47% fewer nuts in the shell and 16% fewer shelled nuts during September and October of 2021 than it did in the previous year,” the California Walnut Board reported to Reuters.
“The 2021 crop we now know has not shipped to the level that we thought,” President and CEO of the Almond Alliance of California, Aubrey Bettencourt told AgNetWest. “The cash flow was not received by our handlers, processors, hullers, and shellers, so they have little to no leeway to afford the pool payments to our farmers for the 2022 year. This is getting to be a scary situation. I’m not speaking for everybody, but it is a concern, and we are starting to see letters about it that we just don’t have the cash flow available to our farmers.”
The product was grown, processed and prepared for shipping, but growers and suppliers haven’t been paid, while the food products sit abandoned, rotting in shipping containers. Growers are now facing the 2022 crops. How do they pay for the new crops when they haven’t been paid for 2021? How perishable are walnuts, almonds, citrus, meat and dairy?
California State Transportation Agency Secretary David S. Kim and California Department of Food and Agriculture Secretary Karen Ross sent a letter in early January 2021 to leading ocean carriers “requesting they take full advantage of underutilized California ports, including the Port of Oakland, to increase capacity for agricultural exports and help relieve supply chain congestion in the San Pedro Bay.” To no avail.
The CNBC investigation found:
“Shipping carriers rejected U.S. agricultural export containers worth hundreds of millions of dollars during October and November, instead sending empty containers to China to be filled with more profitable Chinese exports.”
“Carriers rejected an estimated 177,938 containers known as TEUs (20-foot equivalent units) in October and November, according to the analysis of data compiled from the Census Bureau and the ports of Los Angeles, Long Beach, California, and New York and New Jersey.”
“According to port trade data, the total export container deficit for the ports of Long Beach and Los Angeles was 136,392 TEUs. An estimated 41,546 TEUs were denied out of the Port of New York and New Jersey. The total value lost export trade from those ports is $632 million.”
The Globe spoke with Aubrey Bettencourt of the Almond Alliance, who joined the alliance December 2021 in the middle of the crisis. “The 2020 almond crop ran long, so the pain of not having the 2021 crop hasn’t been felt yet,” she said. “But the global demand of almonds is huge.”
Bettencourt explained that for the retail side – the middle purveyor – they don’t care. “They will replace almonds on the store shelves with another snack.” So unless almonds are a part of a product, like Almond Milk, or almond flour, not everyone will experience the loss.
There are two other regions which grow almonds – Spain and Australia, Bettencourt said. And Australia is a major supplier to markets in the Asia-Pacific region, and has a free-trade agreement with China. Bettencourt said our second largest almond market is Germany, but Spain as a grower could supply the Germans.
California’s Congressional Delegation is working on this, especially after realizing the $2.1 billion loss of agriculture revenue in California because of this shipping crisis, Bettencourt said. And that means no tax revenue to the state on the $2.1 billion. The shipping and port crisis “has been almost one year to date. Last February/March 2021 was the last normal period at our ports,” Bettencourt added.
U.S. Senator John Thune (R-ND) and Rep. John Garamendi (D-CA) have bipartisan legislation addressing this crisis, but do California growers and ranchers have the time it takes to get legislation passed and into practice, even if Congress is moving fast?
And what happens if almond, walnut, citrus growers, and meat and dairy producers don’t deliver the contracted products? Everyone involved wants to know this answer.
Ironically, next week, trans-Pacific and global container shipping and logistics companies gather at a conference in Long Beach, California, billed as “The must-attend conference for the trans-Pacific and global container shipping and logistics community.” The cost to attend the conference varies between $895 up to $3,345, which does not include golf at Pelican Hill Newport Beach.
View Comments (72)
It would be nice to just cut off as much trade as possible with China until manufacturing ramped up stateside to cut it all. Perhaps I'm blind but I don't see any benefit to the majority of Americans in trade with them.
That is what Trump tried to do. Re? But no, it would raise the cost of living. His idea was shot down. Bringing jobs back was opposed as a bad idea.
Then he should have led by example,, by not renewing his manufacturing contracts with China and having his furniture, clothing and other name brands made there as well as his contracts in India, Bangladesh, and Mexico. Plus if you and when you get an opportunity read the trade agreement his administration negotiated with China and Mexico. Not good for American manufacturing at all. Next time you go by a Chevy car Lott look at where over 45% of the truck original parts are made… (Mexico) some times it’s best to know facts then say what you hear. And your right if our Congress would have done there job this tread bill would not have passed but if Trump wanted his words to mean something he should have led by example. A true leader never ask others to do what he or she is unwilling to do….
Of course, if Biden had tried to do the same thing, he would have been hailed as a messiah!
Instead, we're STILL seeing a skyrocketing cost of living, and we're having to kiss China's ring...
Biden has spent his entire first year proving Trump was right again and again and again...
If course there are people that are gonna try to claim that one side of the isle or the other is at faut. "LAME IDEA"!!! IF THEY LEAVE HERE WITH NOTHING, AND WE DONT ACCEPT THAT CHINESE JUNK, THEYRE GONNA FET TIRED OF SAILING BACK AND FORTH WITHOUT GETTING PAID...
But you have an insatiable appetite for Chinese junk such as i Phones, computers, tools etc.
Unfortunately this is a "catch 22". Manufacturing is finding itself unable to make the parts to fill the orders because it can't get supplies to make the parts. In addition, some can't get new orders because the companies they work with either don't have the funds or everyone involved is lacking the help to make them. What happened to all the vessels that were sitting off the Coast of California all the way down to Mexico? You know the ones that coudn't unload because there weren't enough truckers to move the freight?
The US NEEDS TO KEEP THEM. To hell with the rest of the world. We might need them to not stave to death
The benefit is lower prices, and of course that's important. But the cost is the destruction of American industry, so the cheap consumer goods don't seem like such a great deal.
So basically China is declaring economic war on US-made goods, eh???
Is "The Big Guy" getting his 10% from the CCP via Hunter, like before November 2020???
Is Gavin getting his kickback for not raising a stink about this damage being caused his California constituents??? Or is his plan to bankrupt the California agribusiness underway so that the CCP can buy up the land for cheap???
Yes, that and him refusing them water should be our clue. Either China or Gates wants the land.
Maybe we need to start sinking Chinese ships as they leave Chinese ports.
Buy as much American goods as you can find. It is getting harder to find items made in the USA but with a search most items can be found.
https://www.madeinamerica.co/
The last 2 years have proved to be frightful for Australian citizens, perhaps their government has become too dependent on China. The CCP is hitting us from all angles to weaken our economy and our will.
I agree Cali Girl, we need to buy American and support small local farmers/businesses! I ordered 2 new American flags since some thug in CA ripped mine down and destroyed it. I found a company that is veteran/family owned called Grace Alley. Beautiful embroidered flags. I now also shop at a small local grocery store that sells local farmers crops/goods. There was a time when we did not rely on China imports, it is time for Americans to support Americans, especially veterans. Mammothnation.com is another site.
Thanks Stacy for the flag recommendation. I will check them out. Wow, stealing flags off a house is so low and ugly.
Shopping local is key.
Some parts of our country have bare shelves, so I hope the California goods are transferred around our country.
We need to return the favor and stop buying so much cheap, low quality junk from China.
This is the fruit of liberalism. The barriers to registering ships in the US is too high and we don't build trade ships here in the US. There is no tax yourself into prosperity solution with globalism.
Stop all food sent to the chicoms. Let them starve.
Agreed. Reverse psychology, no more exports to China and cut the imports too. That will never happen though, with our current leadership.
The article is simply incorrect. The Chinese are not paying Danish owned ocean carriers for example to reject US Export cargo. The reality is that if you take a loaded container to China it takes as much as 30 days to clear customs and deliver. When an export container pays USD 1500.00 from Oakland to China you are better off to take an empty and get it quickly loaded with cargo that is paying USD 15,000 plus back to the US. You make more profitable use of the container by moving it empty. It is supply and demand, not some conspiracy.
The left owns this!
Let's go Brandon!
So is California is not part of US anymore?
California is a sanctuary state, not subject to US laws.
I think Hawaii is a sanctuary state as well. There are also sanctuary cities in the US, even DC, so really, these cities and states aren’t subject to US laws. Trump tried to withhold Federal government payments to US cities and states but the courts blocked him, so those cities and states have an odd relationship to the US, that they don’t have to follow US laws, essentially removing them from US sovereignty and jurisdiction, but the US has to send money to them.
So the answer is “no”, they’re not part of the US, but they do have elections for Representatives to Washington to appropriate money to be sent by the US to California.
Granted, it is a complicated relationship involving sovereignty, jurisdiction and payments, especially entitlements, but it does seem California and its residents are entitled to payments from the US, but being a sanctuary state, it’s not subject to US laws and sovereignty.
It does seem the US is obliged to protect California from invasion, but that’s optional as well, in that the US and California have on open borders policy, or don’t have a border with Mexico.
Tulsi Gabbard, former US congresswoman from Hawaii and US Presidential Candidate, said during an interview, if you don’t have a border, you don’t have a country, so likely the US isn’t a country as far as California is concerned, and California could be part of Mexico.
I think the US does pay social security benefits to Mexican Nationals who were working in the US, if they made social security payments into US Social Security.
I’m not advocating for breakup of the US, but it seems to be an ongoing legal process with laws, courts, Congress, Presidential executive orders, state legislatures and city counsels leading to a sort of fragmentation of the US, with it becoming more of a global entity with a gradual breakup, which this article about farm produce from California Producers being left to rot on docks and in warehouses while Chinese goods are brought in on a priority basis, meaning Chinese producers have priority. It’s not surprising China would give priority to Chinese products while American products are left to rot.
Unsurprisingly, American agricultural producers have little if any leverage with anyone. Washington has little interest, since as a voting block, they don’t amount to much, and barely a blip economically, compared to the Big Tech companies in Silicon Valley.
Likely the American agricultural sector will continue it’s economic collapse while American agricultural farm land is bought up by big tech billionaires such as Bill Gates, who I have read is the largest holder of US farmland, which has become a commodity in its own right.
Steven, stop spreading misinformation. Its crap like this that confuses people from facts and "opinions/misinterpretations". Sanctuaries were regional responses to the controversial US immigration policy during the flooding of migrant caravans . CA would need to declare succession from the US and be it's own country to no longer adhere to US laws. CA is still a state of the US and is still subjected to US laws while there is inter-state commerce, congressional representation and receiving federal funding and aid.
When did enforcing immigration laws become "controversial"?
The only "misinformation and crap" being spread is in your post. If you don't realize the California legislature is corrupt as it is, you are either naive or support that corruption.
Steven, you are so wrong. Sanctuary states, counties, cities are only for protection of immigrants. They do not call I.C.E. on people here illegally but I.C.E. can go into those areas and arrest people. Sanctuary, in the sense you are using it, does not mean they no longer are a part of the US. They still follow federal laws, pay federal taxes and get federal funding. You n;ed to do your homework about sanctuary states
Yes. That is the California legislators version of states rights.
Why so much hates here? This is a free world and people are doing free trade. You just need to pay more to get your containers. Don’t cry like a looser.