The International Dairy Foods Association (IDFA), the Port of Los Angeles (POLA), and CMA CGM have announced the formation of a Dairy Exports Working Group aimed at addressing supply chain issues hampering US dairy products exports.
The partners will focus on US West Coast seaports, where a majority of dairy products begin their export journey.
"US dairy exports reached a near-record US$6.4 billion in 2020 and continued to set a blazing pace in 2021 due to surging global demand, but the US dairy industry could be exporting much more to destinations around the world if there was more reliability and predictability in the supply chain," explained Michael Dykes, president and CEO of IDFA.
"This type of collaboration is essential to avoid significant future disruptions to the US dairy supply chain that will result if exports continue to languish," added Dykes.
Particularly, the Dairy Exports Working Group will examine several shipping and rail challenges and solutions, including exploring ways to aggregate and streamline US dairy exports from multiple suppliers, to ensure more consolidated bookings.
The group will also work to increase rail availability in the interior of the US, in order to reach non-coastal exporters and will examine the viability of implementing a "fast lane" concept for vessels agreeing to depart full or with fewer empty cargo containers.
Moreover, the group will define agreed terms for exporters using empty containers currently languishing at US ports and will establish guarantees to fix and surpass "ghost bookings."
Port of Los Angeles executive director, Gene Seroka said that the dairy industry partners will try to find solutions that will benefit not only the dairy industry but all American exporters.
"American dairy exporters have been hard hit by supply chain challenges and trade policy that have made it difficult to get their goods to global markets," he noted.
In addition, Ed Aldridge, president of CMA CGM and APL North America, stated, "This collaborative partnership will enable us to quickly implement innovative solutions, designed to not only help the dairy industry with current supply chain challenges but also to pave the way for the future."
The current situation is costing US dairy companies millions of dollars and damaging the credibility and reputation of US dairy exporters among global customers, according to a statement, while US warehouses are full or facing near capacity levels due to delays.
Hence, the group as well as other interested ports, carriers, and other supply chain stakeholders will develop market-driven solutions that will create new business, help alleviate the empty container problem, and expedite the flow of American dairy exports to our customers.
IDFA has also been advocating with the US Department of Agriculture, the White House, the US Department of Transportation, and other agencies to raise awareness and ensure protection of America’s dairy industry.