NEWARK, NJ (Essex County) — U.S. Congressman Josh Gottheimer (NJ-5) Tuesday announced steps to combat supply chain issues, ocean freight carrier delays, and rising shipping costs hurting North Jersey small businesses, workers, and families, and which will impact the upcoming holiday season.
Gottheimer called for action to combat supply chain issues, including:
- Critical Congressional Oversight: The House Committees on Transportation and Infrastructure, Ways and Means, and Homeland Security should hold hearings to investigate the continued spike in global shipping prices and potential collusion in the marketplace.
- Dedicated Federal Action: The Federal Maritime Commission and all relevant authorities must redouble their oversight efforts to investigate the practices of major ocean carriers and assess if there is any collusion or anti-competitive practices.
- Modernization of the U.S. Department of Homeland Security (DHS): DHS must modernize how it tracks and clears ship traffic and to get goods moving. Currently, outdated processes are helping contribute to the backlog.
- Key Bipartisan Legislation for Ocean Shipping Reform: Gottheimer is cosponsoring key bipartisan legislation, the Ocean Shipping Reform Act of 2021, to take major steps to mitigate supply chain issues and help ensure that businesses and consumers aren’t facing untenable delays and price increases.
Gottheimer was joined today by U.S. Congressman Donald Payne, Jr. (NJ-10); Sam Ruda, the Director for the Port Authority of NY and NJ; President and CEO of SG Companies Matt Feiner; Federal Maritime Commission Chairman Dan Maffei; and stakeholders at the Port in Newark.
While the hardworking men and women of the International Longshoremen’s Association and the Port in Newark are working overtime to mitigate the issue, the major ocean carriers are continuing to raise prices and take advantage of a world that is still recovering from COVID-19.
“We are currently facing a shipping and supply chain crisis. Shipping container costs have increased ten times since the start of COVID, there are major delays, and we are having trouble getting goods to America, from ventilators to shoes to clothing and toys, and the price of nearly everything we import is through the roof,” said Congressman Josh Gottheimer (NJ-5), a member of the House Homeland Security Committee. “These costs are equal to a new major ocean freight carrier-imposed international tax on Jersey’s middle class families. Shipment times between China to the United States are 83 percent longer than in late 2019. I think of all the families who were hit by the awful flash flooding from Hurricane Ida and now need to replace furniture, clothes, or other items that they lost from storm damage. These aren’t just things that people want. They are goods that people need.”
Additionally, supply chain issues, increasing costs, and delays are crippling small businesses, because it is harder for them to absorb price increases on the goods they sell — if they can even get them — all while they are trying to stock up for the upcoming holiday season.
“I think that today’s meeting was a very good start to deal with the issues of unloading cargo at the port,” said Congressman Donald M. Payne, Jr. “We are doing everything we can to minimize these issues as we approach the holiday season. The situation at Newark is not nearly as large as the problems faced on the West Coast and that is due to the great work of Port Authority workers. But I am outraged to hear that the cost to move a shipping container has risen from $1,000 before the pandemic to more than $22,000 today. We will not tolerate any arbitrary price increases that are not directly related to legitimate market forces.”
“Listen to this — the average cost of shipping a container used to be between $1000-2,000 on the spot market. Now, believe it or not, it’s between $22,000-30,000 — ten times more than it used to be. Supply and demand are real, but the idea that a container should cost 10 times what it did before COVID is absurd,” Gottheimer said . “We need to fix this shipping crisis now – before the holidays because the last thing we need is a giant piece of coal in America’s Christmas stocking.”
“Typically, we would pay 2500 dollars a container to move goods from China to the US and now we are paying 20,000, “ said CEO of SG Companies Matt Feiner. “It’s really difficult on the company — we have survived two world wars and other challenges over the years, but I have to tell you that this has been an incredible challenge for us that impacts our profitability and our ability to take care of our incredible team of people who are helping us weather this storm.”
“Everything from clothing to auto-parts to furniture to building supplies, to COVID-19 masks, to what we buy in Wal-Mart to the local town store, is made elsewhere and depends on the giant ships like the ones at this port to get here. And those goods are all packed in giant shipping containers and sent from ports around the world by one of the five major ocean carriers and by ocean liners that literally control the shipping market, one of them Chinese-owned. There is no apparent real competition, it’s a cornered market with no global transparency into the supply chain, and, I believe there is potential collusion between these major ocean carriers,” Gottheimer said.