Biden Criticizes Carriers Signing Bill While WSC Calls Out Rhetoric

President Joe Biden completed the legislative process on June 16 signing the Ocean Shipping Reform Act into law. In front of an audience including the sponsors of the bill along with representatives from the farming, retailing, and manufacturing sectors, the president hailed the bipartisan efforts that completed “the first significant reform of shipping regulations in 24 years,” saying the legislation will hold ocean shipping accountable.

While thanking the members of Congress for working together and quickly moving, identifying the problem that shippers, manufacturers, and the agricultural industry were highlighting, and passing bipartisan reform, the president also reiterated his criticisms of ocean shippers. He reaffirmed his belief that the bill will “put a stop to shipping companies taking advantage of American families, farmers, ranchers, and businesses.”

Starting early in 2022, the president has repeatedly asserted that nine major shipping companies consolidated into three alliances control the vast majority of ocean shipping in the world. He highlights that during the pandemic shipping prices increases by as much as 1000 percent. The shipping lines he said made $190 billion in profits in 2021, seven times the year before, becoming one of the factors impacting prices for goods across America. He also asserted that these foreign ocean carriers are refusing to carry American-made products back to Asia.

While trade associations representing exporters, manufacturers, and the retailing and agricultural sectors continue to hail the passage of the legislation, the World Shipping Council representing the ocean carriers also took the opportunity to reiterate its positions and the problem with the legislation.

“Recent weeks have seen several attempts to demonize ocean carriers by deploying ‘us versus them’ rhetoric. That is not only inaccurate but dangerous, as it undermines the ability to understand and work towards solving the root causes of America’s supply chain problems,” they wrote in a statement released shortly after the signing.

“The worn-out talking point that ‘there’s only nine major ocean shipping lines who ship from Asia to the United States’ is also untrue,” said the WSC. “While nine lines in and of itself is evidence of competition and not concentration, there are an additional thirteen ocean liner companies that operated over 30 percent of the sailings from Asia to the U.S so far this year. In fact, competition increased during the pandemic.”

Defending the industry the group acknowledges after years of low or no profits ocean shippers are “actually making profits.” They however cite the investment in new capacity while renewing calls for the United States to make the same level of commitment investing in port and the supply chain infrastructure.

Biden said he was pleased to sign the bill that would extend the authority of the Federal Maritime Commission, a critical agency that the average American likely does not even know exists. He said the legislation will help to crack down on excessive fees and prohibit ocean shippers from refusing to carry U.S. exports. It now falls to the FMC to translate the principles of the legislation into rulemaking and new enforcement programs.