- DTN Headline News
Groups Want Terminal Reopened
Tuesday, July 29, 2014 4:46PM CDT

By Chris Clayton
DTN Ag Policy Editor

OMAHA (DTN) -- Agricultural groups are pushing USDA to reinstate grain inspections at the port of Vancouver, Wash., a month after state inspectors stopped inspecting grain for export at United Grain Corp. because of an ongoing labor dispute.

Farm groups say a bad precedent is being set if U.S. grain exports can be blocked because of a domestic labor dispute.

Other than a single grain shipment based on a waiver, United Grain has been unable to ship grain for effectively a month after the Washington State Department of Agriculture announced it would stop sending inspectors to the facility. The Washington State Department of Agriculture provided official federal inspections through an agreement with USDA.

United Grain Corp. is locked in a labor dispute with the International Longshore and Warehouse Union over a new contract. Washington Gov. Jay Inslee agreed last fall to provide police escort for state inspectors following alleged threats and intimidation by union workers, who are locked out of the terminal. Inslee opted to withdraw the police escort earlier this month. A spokesman for Inslee cited the lack of headway in the talks between the company and the union, arguing the escorts were meant to be temporary.

More than 20 agricultural groups wrote USDA Secretary Tom Vilsack earlier this month expressing concerns about the disruption of inspection and weighing services. The groups noted they had met with USDA officials last October about creating a contingency plan in case Washington State officials opted to cease inspections at the facilities. Based on the actions by Washington's governor, agricultural groups argue that USDA has an obligation to use its own personnel to conduct the official inspections.

Thus far, USDA has declined to respond. In an email to DTN on Tuesday, a USDA spokeswoman stated, "The matter is currently under review and the USDA is unable to comment while it is under review."

Because of the harassment, Washington State officials also asked USDA to take over inspections at the port, but USDA has declined to do so.

Members of Congress from Washington State have asked Inslee to reinstate the inspections, citing that United Grain has offered to reimburse the state for the cost of the escorts.

Leaders of agricultural groups argue that the country's reputation as a reliable grain exporter is at stake. The American Farm Bureau Federation, National Association of Wheat Growers and the National Grain and Feed Association all sent news releases Tuesday drawing attention to the problems at the port.

"It's an obligation to have that grain inspected for export," Tom Sleight, president and CEO of the U.S. Grains Council, said in an interview. "We are concerned that it gets resolved because we need that grain moving."

Pat McCormick, a spokesman for United Grain, said the company has only loaded one vessel since July 7 after the buyer and USDA agreed to a waiver of the grain inspection. However, that can only be done for shipments going to countries that don't require inspections. That shipment was still delayed 11 days.

"We did manage one vessel, but the likelihood of being able to move much grain through our terminal is very remote," McCormick said.

BNSF notified United Grain over the weekend that the railroad would embargo further grain shipments to the terminal. United Grain had scheduled about 17 million bushels for export in August, but notified customers that they would need to look elsewhere until the inspection situation is resolved.

"We have heard from customers pretty clearly that they are looking for other opportunities to move their grain," McCormick said.

The terminal shutdown has created upstream problems moving grain and widening basis for farmers as well. Further, American farm groups and buyers overseas are raising questions about how the labor dispute affects the reliability of U.S. exports.

"There are serious questions that are being raised about how this is affecting the perceptions of the U.S. as a grain trading partner," McCormick said.

Other countries, notably Argentina, have developed a pattern of shutting down terminals and exports because of ongoing labor strife.

McCormick said the company has repeatedly asked USDA to provide inspectors. Initially, USDA officials said their own concern about the safety of inspectors was an issue. USDA did an assessment of the situation, but hasn't gotten back to the company. McCormick said there were no disputes or violence with picketers since Washington State began providing law-enforcement escorts. The company offered to pay for the escorts to keep them, but that did not remedy the situation.

"It has seemed more like to us as a pretext for the governor's decision to take sides in the labor dispute," McCormick said.

Chris Clayton can be reached at chris.clayton@dtn.com


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