The Institute of Scrap Recycling Industries (ISRI) president Robin Wiener sent a letter to U.S. Department of Commerce Secretary Penny Pritzker expressing “concern with the long-term impacts of the recent West Coast ports dispute on the health of the economy, the recycling industry, and our balance of trade.”
The letter outlined the significant role the recycling industry plays in the country’s exports and overall economy and how costly disruptions like the West Coasts ports must be avoided in the future.
Excerpts from the letter follow:
Since President Obama first took office in 2009, net exports of scrap have contributed $120 billion to the U.S. balance of trade and maintaining access to overseas markets is vital to the health of our industry. The U.S. annually exports more than 40 million tons of scrap to 160 countries around the globe every year, with total U.S. scrap exports valued at more than $23 billion in 2013. This amounts to 30 to 40 percent of the annual industry revenue. And while falling commodity prices were already hurting the recycling industry, the West Coast ports situation had an equally damaging effect on recyclers across the country. The knock-on effects of the labor dispute between the International Longshore and Warehouse Union and Pacific Maritime Association caused production lines across the country to slow, shipments to retailers to dwindle, and manufacturing jobs to be lost. It may be surprising to some, but the recycling industry is the perfect case study for the collateral damage caused by the ports dispute. In fact, scrap is the top export by volume out of the ports of Los Angeles and Long Beach.
Fortunately a complete shutdown appears to have been averted as that would have been even more devastating. Using figures from 2013, before the slowdown, an estimated $25 million of scrap exports were put on container ships and sent overseas every day. This would have be lost each day the ports were shutdown. Despite the deal, we still don’t know the long-term costs, many of which can be catastrophic. Key overseas markets for scrap exports from the West Coast last year included China ($4.2 billion), Taiwan ($1.1 billion), South Korea ($1.1 billion), Japan ($402 million), and Thailand ($200 million). These are critical and extremely competitive markets for U.S. scrap exports, especially at a time of slowing global growth, a stronger U.S. dollar and falling commodity prices.
The port dispute hit much closer to home for many American workers. Scrap exports support 35,000 jobs in California, Washington, and Oregon, and hundreds of thousands more across the country that process, broker, ship and perform numerous other roles in the manufacture of recycled commodities. Many of these workers lost their jobs or saw a reduction in hours as a result of the slowdown.
Published in the May 2015 Edition of American Recycler News