The International Dairy Foods Association (IDFA), U.S. Dairy Export Council (USDEC) and National Milk Producers Federation (NMPF) applauded the Senate introduction of the Ocean Shipping Reform Act (OSRA) on Feb. 3.
Michael Dykes, D.V.M., president and CEO of Washington, D.C.-based IDFA, released the following statement:
“On behalf of the U.S. dairy industry, I want to thank Senators Thune of South Dakota and Klobuchar of Minnesota for introducing this bill in the Senate in a bipartisan manner. The Ocean Shipping Reform Act passed the House of Representatives with dozens of bipartisan sponsors and 364 votes, demonstrating that Congress can indeed work together to provide important tools to address supply chain bottlenecks plaguing U.S. dairy and food exports. IDFA strongly encourages the Senate to pass this bill in a timely manner to assure businesses throughout the food supply chain that help is on the way.
“The Ocean Shipping Reform Act will provide real, long-term solutions for the myriad issues congesting U.S. ports and slowing U.S. dairy exports. The bill places disciplines on ocean carriers’ ability to decline export cargo and when demurrage can be charged, helping to get U.S. dairy exports on the water in a timelier manner. It also strengthens the oversight authority of the Federal Maritime Commission over ocean carriers, the majority of which are foreign owned.
“IDFA recently announced a Dairy Exports Working Group with the Port of Los Angeles and shipping company CMA CGM to identify and address supply chain issues hindering U.S. dairy product exports. We are hopeful that the Senate will act with urgency to move the Ocean Shipping Reform Act, sending a signal across food and agriculture that a new group of ‘supply chain problem solvers’ has arrived to remove obstacles and invest in long-term solutions that help American agriculture to thrive.
“Unlike 20 years ago when we exported very little, the U.S. dairy industry today is the third-largest dairy exporting nation in the world. Today, we need America’s transportation and export systems to function with a level of precision and efficiency that sets a global standard so U.S. dairy can achieve our goal of becoming the world’s leading dairy supplier within a decade.”
NMPF and USDEC also commended lawmakers for introducing the legislation. Should it become law, it would help alleviate delays and disruptions at U.S. ports that have been a critical part of the export supply chain challenges plaguing U.S. exporters.
“The supply chain challenges that have beset American exporters pose significant difficulties for U.S. dairy producers, causing over $1.3 billion in export losses for our sector during the first three quarters of 2021,” said Jim Mulhern, president and CEO of Arlington, Va.-based NMPF. “We greatly appreciate the leadership of Sens. Klobuchar and Thune to introduce legislation that will encourage many of the ocean carriers to stop unfair practices. We are committed to working with the senators and their colleagues in Congress as legislation moves forward to ensure that a final law delivers the changes our exporters most urgently need to see.”
USDEC and NMPF said they will continue to work with the Senate to strengthen the measure further as it advances through Congress.
The organizations, in collaboration with their member Supply Chain Working Group, have leveraged a multi-pronged approach with Congress and the administration from early 2021 to address the supply chain disruptions plaguing the dairy industry, including unprecedented fees, container availability and lack of transparency. Foreign-owned ocean carriers’ practices have been a sizable component of those problems, USDEC and NMPF said. The organizations have provided input into the legislative text and worked closely with the sponsors of this bill to advance Congressional efforts to update the Shipping Act to encourage more reasonable and equitable access to the export shipping supply chain.
Beyond legislation, NMPF and USDEC said they also continue to work with Congress and the administration to identify additional measures to ease the congestion — including calling for further expanding port hours of operation, increased data transparency and investments in key supply chain infrastructure.
“This Senate bill takes strong strides to address many of the challenges dairy exporters have faced, including securing export vessel bookings and combatting unfair detention and demurrage charges, vital issues to ensure our products reach their intended destinations,” said Krysta Harden, president and CEO of USDEC, Arlington, Va. “When we can’t export our products, we not only jeopardize our foreign customer relationships and markets, but we also lose value-added opportunities that create jobs and investment in the United States. We look forward to continuing to work with Senators Klobuchar and Thune, and others in Congress, to address outstanding concerns and provide for the strongest possible reforms.”