An association representing container terminal owners and a union representing 22,000 dockworkers are unlikely to reach a deal in contract negotiations before the current contract expires next month, but experts say a strike or lockout is unlikely.

Neither side foresees the conflict escalating into anything that would impede port operations or further hobble supply chains.

Shipping experts say they're cautiously optimistic that talks between the International Longshore and Warehouse Union and the Pacific Maritime Association will be resolved reasonably.

Negotiations began May 10 over the contract that governs wages, benefits and employment rules for the longshoremen who work at Pacific Maritime Association terminals. The existing agreement expires on July 1.

When the previous contract ended in mid-2014, it caused work slowdowns that cost businesses, including agricultural exporters, hundreds of millions of dollars. A deal was finally struck in 2015.

This time, however, both sides have been more vocal about their intention to avoid a fallout.

"Both the PMA and the ILWU agree that they are unlikely to reach a deal before the July 1 expiration of the current agreement," the groups said in a joint statement this week. "This timing is typical, and cargo operations continue beyond the expiration of the current contract. Neither party is preparing for a strike or a lockout, contrary to speculation in news reports."

Bill Mongelluzzo, editor of the Journal of Commerce and an expert on trans-Pacific trade, said that in all his years following contract negotiations, he can't recall ever hearing a statement like that from both parties while negotiations were ongoing.

"Not reaching an agreement by July 1 does not mean a lockout or strike is imminent," Mongelluzzo told agricultural exporters at the Agriculture Transportation Coalition's annual conference in Tacoma.

Some shipping experts say they suspect President Biden put pressure on the groups not to further upend global supply chains during his visit to Southern California last week, where Biden met with both groups aboard the Battleship U.S.S. Iowa in San Pedro.

One trade expert said Biden has made it clear that his administration "will not tolerate interruptions" to port productivity.

In their joint statement, the union and maritime association said they discussed supply chain congestion with the president during his visit and reaffirmed "their shared commitment to reach a collective bargaining agreement that is fair to both parties."

The contract is about more than wages and benefits. It's also about reaching an agreement over employment rules, including automation.

Shipping experts say automation is the main hot-button issue in the 2022 contract negotiations.

Some ports, looking to become more efficient, are exploring automation, including using driverless automated cranes and driverless yard tractors.

Previous contract negotiations, including in 2008, won terminal owners the right to use some forms of automation.

But the 2008 agreement was widely criticized by dockworkers. Since then, the ILWU has aimed to block most further attempts at automation.

Jared Faker, president of the International Longshore and Warehouse Union's Local 23 chapter, said automation at ports has led to job loss for dockworkers.

Although terminal leaders aren't too concerned about an impending work stoppage, some are worried that this year's contract could tie their hands regarding automation.

"We're going to see more fold out on this contract negotiation," said Peter Friedmann, executive director of the Agriculture Transportation Coalition. Big changes, he said, may be in store.

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I cover agricultural, environmental and rural news across the Western U.S. Have a news tip? Contact me. 509-699-9099 or smcclain@capitalpress.com

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