West Coast dockworkers, shippers to talk contract extension

September 27, 2016 3:39 PM EDT

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By Steve Gorman

LOS ANGELES (Reuters) - Shipping companies and a powerful dockworkers union have agreed to discuss a possible extension to a contract reached last year, ending labor strife that disrupted U.S. West Coast ports and bogged down cargo trade with Asia for months.

The International Longshore and Warehouse Union and the Pacific Maritime Association (PMA), which represents major shippers and terminal operators, have tentatively set talks on the proposal for Nov. 1-2, the two sides said in a joint statement on Tuesday.

The statement did not disclose how long a contract extension might run and said: "No additional comments from either party will be made prior" to November's talks, which are expected to take place in San Francisco.

The two sides said another statement may be issued afterward.

The current five-year contract, which expires on July 1, 2019, covers 20,000 dockworkers at 29 West Coast ports handling nearly half of all U.S. maritime trade and more than 70 percent of the country's imports from Asia.

The February 2015 settlement of that contract, in a deal brokered with the help of U.S. Labor Secretary Thomas Perez and a federal mediator, capped months of labor tensions and increasing gridlock at the ports.

Severe cargo slowdowns, blamed by each side on the other amid pressure tactics during the last round of talks, reverberated across the U.S. commercial supply chain and snarled trans-Pacific trade in industries ranging from agriculture to automobiles.

It took many weeks for the flow of shipping and cargo traffic to return to normal following the settlement.

Shippers and terminal operators are eager to ensure continued labor stability for as long as possible, avoiding a potential repeat of disruptions that by some projections, could have ended up costing the U.S. economy billions of dollars.

California farmers were especially hard hit by port congestion, with export losses from perishable goods estimated to have run hundreds of millions of dollars per week.

Sources for the two sides said the latest negotiations on a possible contract extension were proposed to the union in a recent letter from James McKenna, chief executive of the PMA.

(Reporting by Steve Gorman; Editing by Alan Crosby)

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