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April 2015 WINES&VINES 15 WINE INDUSTRY NEWS O akland, Calif.—After working without a contract for seven months, dockworkers at 29 West Coast ports breathed a sigh of relief Feb. 20, when labor negotiators reached a tentative working agreement. But many suppliers serving the wine industry are still waiting for their shipments to be delivered, and laborers have yet to vote on the proposed con- tract, opening a window of possi- bility for further delays. Chris Kammer, CEO of San Mateo, Calif.-based Access Supply Chain/Access Wine Service, told Wines & Vines he began warning clients of a port slowdown at the Unified Wine & Grape Symposium held in January 2014. "We knew back last spring there was going to be a disaster at these ports. I was telling clients, 'Be prepared for a rough spring, and ship early,'" he said. "I felt like the guy walking around with a sign saying the world was coming to an end." Beyond the problem of delayed shipments, Kammer, who counts wineries and sellers of winery equipment among his clients, said port delays have complicated pay- ment terms for many importers. With a shipment currently more than two weeks late, Union- pack operations manager Tracy Totten agrees. "The suppliers want their money, yet we don't have the product to send to customers," said Totten, whose American Can- yon, Calif.-based company pro- vides screwcaps, capsules and sparkling wine hoods to North American wineries. Totten was one of dozens of wine industry suppliers who re- sponded to a survey Wines & Vines sent out to gauge the effects of the West Coast port slowdown. Of the survey respondents, more than 59% reported experiencing delays of four to eight weeks. A similar num- ber said the slowdown had taken a financial toll on their business. Brett Peterson, general man- ager for bottle supplier Vitroval USA Inc., told Wines & Vines the port slowdown already has cost his business more than $100,000. "My inventory is currently at 21% of what it should be at this time of year due to the port slowdown. My shipping costs are currently 28% higher than last November, and the rates are likely to stay high for three more months until the backlog clears." Peterson recounted the tale of one shipment of 2,280 cases that was booked to ship from China to Oakland. During a scheduled stop in Long Beach, Calif., the ship owner decided to cancel the final leg of the trip due to port delays. The shipper required the container be returned empty to Long Beach, meaning Vitroval had to arrange and pay for loading the goods into a truck and transporting them from Long Beach to the Bay Area. Tom Nulman, president of San Luis Obispo, Calif.-based mobile bottling firm The Bottle Meister, said several of his Central Coast winery clients were unable to take receipt of packaging materials as a result of the West Coast port slowdown, forcing them to cancel scheduled bottling dates. Lucy Farber, operations man- ager at Alameda, Calif.-based craft beverage producer St. George Spirits, which produces custom grappa for several Califor- nia wineries, told Wines & Vines, "We had a rush export order to France, which, if it couldn't arrive by a certain date, would be can- celled. We had to arrange for the goods to ship by truck to Houston and leave from there, to be as- sured the order would arrive within six weeks." Mark Sottana, general man- ager of Santa Rosa, Calif.-based Inoxpa USA Inc., which special- izes in sanitary stainless steel equipment for the wine industry, said the West Coast port shut- down cost his company more than $10,000 in sales. "We have a ship- ment of 12 crates worth over $44,000 that was supposed to arrive early last month," he told Wines & Vines. "Our shipment left India in late November/early De- cember for expected delivery in early February. It just now is off the ship, but we still do not know when we will receive it." —Kate Lavin TOP STORY West Coast Port Slowdown Hinders Wine Industry CALIFORNIA RAINFALL—SEASON TO DATE Season to Date Average to Date Percent of Average to Date Lodi 10 11 94% Monterey 5 7 67% Napa 19 28 68% Sonoma 22 24 92% RAINFALL SEASON TO DATE—PERCENT OF AVERAGE 0 20% 40% 60% 80% 100% Rainfall season July 2014-June 2015, rainfall data in inches through March 10. Source: winebusiness.com, California Irrigation Management Information System Lodi Monterey Napa Sonoma The Port of Oakland is among West Coast ports experiencing significant delays. POLL OF WINE INDUSTRY SUPPLIERS Average Reported Delay Financial Impact Yes 58.3% Other 8.3% No 33.3% 4-8 weeks 59.3% > 8 weeks 5% 1-4 weeks 35.5% Source: Wines & Vines