Congress May Give Jones Act Ships Special Port Privileges

by Captain John Konrad (gCaptain) This week, in the wake of the Ocean Shipping Reform Act that President Biden signed into law last month, US Congressmen John Garamendi and Jim Costa introduced new legislation to prioritize US shipping companies and exporters. If passed, a new law called “the American PortAccess Privileges Act” would give US Merchant Marine and US Military ships – including the Jones Act fleet – benefits including the ability to bypass port congestion at major US ports.

“Foreign exporters’ access to the American market and our consumers is a privilege, not a right. Cargo ships looking to offload foreign-made products and profit off West Coast ports must provide opportunities for American exports in return. This legislation would put American exports at the front of the line at our ports to support American businesses and workers. Congress must restore fairness at our ports for American exporters to help reduce the United States’ longstanding trade imbalance with countries like China,” said Congressman John Garamendi.

Garamendi, who is one of the nation’s top Jones Act supporters and sits on the powerful Armed Forces Committee, has been successful in enacting maritime legislation this year. Garamendi’s bipartisan, bicameral Ocean Shipping Reform Act of 2022, was signed into law by President Biden on June 16, 2022. Earlier this year his Merchant Mariners of World War II Congressional Gold Medal Act recognized approximately 1,500 living US Merchant Marine veterans.

“Supply chain disruptions are hurting California farmers and exporters like never before,” said Costa. “We need to remove bottlenecks and mitigate congestion at our ports to carry out American exports like the food grown in the San Joaquin Valley. I’m proud to introduce this legislation with Congressman Garamendi to boost American exports and to help our Valley’s agricultural economy recover,” said Congressman Jim Costa who co-sponsored the bill. 

According to official documents the “American Port Access Privileges Act” would ensure fair trade for U.S. businesses and keep hard-won foreign markets accessible to California’s agricultural exporters by:

• Codifying the current preferences for military, Jones Act, and other US-flagged vessels in place at many major American ports.
• Establishing a secondary berthing preference for ocean-going commercial vessels servicing multiple ports in the United States or with significant cargo bookings of American exports. This new preferential berthing will reward ocean carriers that serve both importers and American exporters by moving those vessels to the front of the queue for unloading and loading. It will similarly incentivize ocean carriers to make second-leg voyages to ports like the Port of Oakland, which is critical for California’s agricultural exporters.
• Ensuring that the new preferential berthing for export carrying-vessels would never interfere with U.S. Coast Guard orders for commercial vessels, port safety, or collective bargaining agreements for port workers.
• Requiring that export-carrying ships seeking preferential berthing report cargo bookings at least 7 days in advance to port operators.
• Authorizing the U.S. Department of Transportation’s Bureau of Transportation Statistics to collect data on berthing and cargo practices at U.S. ports. This will evaluate ocean carriers’ practices for port calls and cargo bookings, as well as the impact of preferential berthing afforded under the bill.

This proposed act comes among growing sentiment against foreign shipping companies and as American populist support for American exporters and American carriers grows. When President Biden visited the Port of Los Angeles last month he said supply chain challenges and related issues that address rising inflation are his “top economic priority.”

“Every once in a while, something you learn makes you viscerally angry. Like if you had the person in front of you, you’d want to pop them. No, I really mean it,” President Biden said, adding: “There are nine — nine major ocean line shipping companies that ship from Asia to the United States. Nine. They form three consortia. These companies have raised their prices by as much as 1,000 percent.”

This also comes as the Pentagon increasingly focuses on the US Merchant Marine and trade with China.

In May Biden selected a 4-star US Army General to become the next port envoy marking the first time in modern history that a top-ranking military officer worked at the White House on maritime-related issues.

The US Maritime Administration (MARAD) has not released a comment and, despite being tasked with supporting the US Merchant Marine, has been notably absent from the conversation about foreign carriers. MARAD has not commented publicly about the renewed political interest in supporting US Merchant Marine ships. According to freight journalist Rachel Premack, MARAD hasn’t even published a report comparing US Flag and Foreign Flag operating costs in over a decade. 

Which begs the question: Is MARAD asleep at the wheel?

“I would love a more recent study,” said Premack in her recent Freightwaves article on US cargo preference. “But this is the best available from the U.S. Maritime Administration (MARAD).”

The new head of MARAD – US Maritime Service Commandant Ann Phillips – has been mostly absent from the public eye since assuming the job in May.

The future will tell whether this new wave of political support for the US Merchant Marine will be sustained in Washington or if MARAD’s inability to communicate and apparent disinterest in assisting the efforts of President Biden, General Lyons, and Congressman Garamendi will cause this renewed support for the US Merchant Marine to wane.

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