January 28, 2021

Commissioner Rebecca F. Dye

Federal Maritime Commission
800 North Capitol Street, N.W.
Washington, D.C. 20573

Dear Commissioner Dye:

We are writing to seek your assistance to address the current delays and
ongoing shipping challenges in California ports which are significantly impacting
the operations of businesses throughout the state. In particular, the operations of
our agricultural sector which relies heavily on export markets are being heavily
affected. We greatly appreciate the Federal Maritime Commission’s recent
Supplemental Order (Fact Finding No. 29) which seeks to determine and resolve
the ongoing issue of congestion and bottleneck at the ports, in particular the
practices related to detention and demurrage charges, export container
availability and container return practices.

California is the largest agricultural exporter and producer in the nation with
more than $21 billion in agricultural exports annually, requiring and supporting
an estimated 157,800 full-time jobs. These exports directly benefit the national
economy by generating $25 billion in additional economic activity. The current
port situation falls within a crucial timeframe for California’s agriculture sector as
it is occurring during a peak shipping period for several commodities. Within the
tree nut sector alone 75 percent of California’s walnuts are shipped during the
last quarter and beginning of the year, as are 40 percent of our pistachios and
48 percent of our almonds. This represents approximately $3.8 billion in exports,
17 percent of total California agricultural exports.

Immediate steps must be taken to help alleviate the multitude of challenges

being experienced at the ports. Potential remedies include: 1) the
suspension/reduction of detention and demurrage charges, 2) the cancelation
of port congestion surcharges, 3) improved communication and notification by
ocean shippers (including the giving of 48 hours advance notice) of empty
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receiving locations (guaranteed by marine terminals), and 4) the

commencement of rule-making related to detention and demurrage practices.

We greatly appreciate your attention to this matter. California’s ports are an

essential part of the nation’s transportation infrastructure and economy. The
current port congestion challenges, combined with the global impact of the
COVID-19 pandemic, have amplified the financial impact to businesses across
this state, especially as it relates to exports. Moving forward we need to find a
long-term solution to these continuing challenges, and we are grateful for your
support, assistance and collaboration.

Sincerely,

Ambassador Eleni Kounalakis (RET.)

Lieutenant Governor

Dee Dee Myers, Director

Governor’s Office of Business and Economic Development

Karen Ross, Secretary

California Department of Food and Agriculture

cc: John Butler, President and CEO, World Shipping Council

John McLaurin, President, Pacific Merchant Shipping Association
Danny Wan, Executive Director, Port of Oakland
Eugene D. Seroka, Executive Director, Port of Los Angeles
Mario Cordero, Executive Director, Port of Long Beach
Kristin Decas, Port Director & CEO, Port of Hueneme