Download - April 29-May 13, 2014 Section B
2014 Focus On International TradeLong Beach Business Journal Page 1
� By TIFFANY L. RIDER
Editor
T he ports of Long Beach and Los
Angeles on the San Pedro Bay
should expect modest growth in line
with relatively balanced container vol-
umes as imports tick upward and ex-
ports recede slightly.
Exports slowed at the start of 2014 fol-
lowing an unusually high-volume end to
2013 as manufacturers prepared for ear-
lier retail demands for celebrations of the
Chinese New Year. Chinese New Year
varies each year; this year it was January
31 while last year it was on February 10.
Next year it falls on February 18.
March numbers indicate a recovery,
however, with exports at the Port of Los
Angeles (POLA) up 21 percent year to
year and imports surging 41 percent
year to year. The overall containerized
cargo volume increase at the POLA was
34 percent. The Port of Long Beach’s
(POLB) preliminary estimates show
that container traffic in March essen-
tially remained flat year to year, drop-
ping a mere 1.9 percent from 2013.
Both ports may see a slowdown in
exports based on a global economic
slowdown led by China, where the
currency stumbled to record lows in
February. Economists are concerned
that the Yuan is dropping so low that
it may raise the cost of U.S. exports
to China while lowering the cost of
China’s exports to the U.S.
“Exports will be a smaller factor for
growth of trade flows through the port
because of the decelerating pace of
global growth, particularly in China,”
Steven Cochrane, managing director of
Moody’s Analytics, told the Business
Journal. “Export flows should still rise,
but the pace will slow and the compo-
sition of goods shipped out of the ports
may shift somewhat from heavy equip-
ment-related [shipments] to . . . more
toward high-end consumer goods, par-
(Please Continue To Next Page)
Inside Focus On International Trade1 Import, Export Activity Through The San Pedro Bay Ports To Remain Stable In 20144 Acting Executive Director Al Moro Discusses Changes And Growth At The Port Of Long Beach6 Port Of Los Angeles’ Gary Lee Moore Highlights Increased Container Traffic And Investments8 Keeping The Ports Safe Through Awareness, Collaboration And Technology10 Twin Ports Use Sustainability Programs, Grants To Clean Up Regional Environment12 Draft Air Quality Regulations For The South Coast Could Hurt Port Business12 U.S. Chamber’s Murphy To Discuss Trade Policy Priorities At Long Beach Chamber Luncheon13 Mattel CEO Bryan Stockton To Speak At Los Angeles Chamber World Trade Week Breakfast14 LA Harbor Grain Terminal: The Gateway To A World Of Grain15 Clean Air, Clean Trucks And The Pride Of Ownership16 World Trade Week Events Calendar May 2014
Presented By The Los Angeles Area Chamber of CommerceCover Pelicans resting on a barge at sunset at Pier T, Port of Long Beach,
by the Long Beach Business Journal’s Thomas McConvillePublication Prepared by the Long Beach Business Journal in cooperation with the Port of Long Beach, Moffatt & Nichol and the Port of Los Angeles, April 29, 2014
Long Beach Business Journal • lbbusinessjournal.com2599 E. 28th St., Suite 212, Signal Hill, CA 90755 • 562/988-1222
Import, Export Activity Through The San Pedro Bay Ports To Remain Stable In 2014
The San Pedro Bay ports – with the Port of Los Angeles in the foreground and the Port of Long Beach in the center – together are the busiest port complex in the Western Hemisphere andthe eighth busiest by container volume in the world (after, in order, Shanghai; Singapore; Hong Kong; Shenzhen, China; Busan, South Korea; Ningbo, China; and Guangzhou, China).(Photograph courtesy of the Port of Los Angeles)
The 200-acre SSA/Pier A at the Port of Long Beach has 10 gantry cranes. (Long BeachBusiness Journal photograph by Carlos Delgado)
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2014 Focus On International TradeLong Beach Business Journal Page 2
ticularly as the value of the Chinese
currency is expected to rise slowly in
coming years. China will still grow, and
some of the growth that formerly would
have been expected in China will shift
to other Pacific Rim locations in South-
east Asia or Latin America.”
Even with sluggish exports, the U.S.
economy is poised for growth. That
growth is estimated between 2.5 percent
and 3.5 percent of gross domestic prod-
uct in 2014. Congress postponed eco-
nomic calamities (including the debt
ceiling and budget cuts) until at least the
start of next year, a move that offers
some stability in the market, noted John
Husing, principal with Irvine-based
Economics & Politics, Inc. and an inter-
national trade and logistics economist.
“The economic recovery is clearly ev-
ident in the industrial production num-
bers, and we see nothing to indicate that
these will slow down in the near future,”
according to Ben Hackett, an interna-
tional trade consultant with more than
30 years experience in transportation
and maritime work. “Having said that,
we are keeping an eye on the recent in-
crease in the inventory-to-sales ratio in
the retail sector. This ratio spiked prior
to the recent recession, so it is definitely
a source of concern. The harsh winter
has had a major effect on consumer
spending, consumer confidence and the
Purchasing Mangers’ Index, but all three
appear to be bouncing back now that the
worst of the weather is behind us.”
According to Cochrane, continued
growth in GDP will drive a growing
demand for imported products as busi-
nesses continue investing, consumers
keep buying and the housing market
commands new construction, appli-
ances and furnishings. “Retail sales
will rise slightly faster than overall
GDP growth due to pent-up demand
for durable goods, including autos,
and rising demand for housing-related
goods,” Cochrane said. “These will be
critical factors supporting growth in
import flows.”
East Coast ports are poised to make
every effort to capture market share, ac-
cording to Hackett. However, Husing
said that he does not believe the
Panama Canal is as worrisome as the
Suez Canal, which offers the potential
for U.S. imports from India to surpass
imports from China as the Chinese
economy slows. “That cargo will not
come to the West Coast,” Husing ex-
plained. “It will come to the East Coast,
not that far from the Suez Canal.”
The Suez Canal in Egypt connects
the Mediterranean Sea and Red Sea, al-
lowing exporters from India and South-
east Asia to easily slip between Africa
and Europe to avoid a trip to Cape
Town, South Africa. The availability of
this expeditious path coupled with the
increase in export activity out of India
has “a bigger potential concern than
Panama,” Husing said, noting he has
gone through the Suez and seen “huge
business” happening there.
The POLA and POLB market share
loss from the Panama Canal expansion
project is likely minimal considering the
fact that the San Pedro Bay Ports com-
plex is the top in the nation for container-
ized cargo imports and it has strong
assets in its transportation infrastructure.
Transportation infrastructure supports
stability, Wells Fargo Managing Director
and Senior Economist Mark Vitner ex-
plained. Terminals, rail lines and truck-
ing routes are “all so solidly in place that
to duplicate all of those networks on the
East [Coast] is not workable,” Vitner
told the Business Journal. “We’re not
going to be able to flip the grid and have
massive amounts of containers redistrib-
uted to the East [Coast.”
Cochrane agreed. “Goods ultimately
destined for these areas [on the West
Coast] may not find sufficient cost
savings via the Southeast or Gulf until
there are significant improvements in
rail connections to inland markets,” he
said. “But that competition will ulti-
mately emerge, along with competi-
tion from the Pacific Northwest,
which means the San Pedro Bay Ports
complex will have to continue improv-
ing speed, efficiency and capacity
over the long term.” �
The CMA CGM Orfeo, pictured here in August 2013, is scheduled to arrive in the early evening this Friday, May 2, at the Port of Long Beach. Built in 2008, the Orfeo is about 1,150long and about 138 feet wide. (Photograph courtesy of the Port of Long Beach)
“Goods ultimately destined for these areas [on the West Coast] may not find
sufficient cost savings via the Southeast or Gulf until there are significant
improvements in rail connections to inland markets. But that competition
will ultimately emerge, along with competition from the Pacific Northwest,
which means the San Pedro Bay Ports complex will have to continue
improving speed, efficiency and capacity over the long term.”Steven Cochrane, Managing Director of Moody’s Analytics
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2014 Focus On International TradeLong Beach Business Journal Page 4
� By SAMANTHA MEHLINGER
Staff Writer
T he Port of Long Beach has seen
many changes in the past few
months – from the changing face of the
port itself as massive, multi-billion cap-
ital improvement projects continue, to
port staff relocating to the interim port
headquarters near the Long Beach Air-
port, to changes in leadership and an
expanding staff.
“It’s a pretty exciting time at the Port
of Long Beach,” Acting Executive Di-
rector Al Moro reflected in an interview
with the Business Journal at his new of-
fice overlooking the airport runway.
Investing In InfrastructureAsk Moro what the port’s greatest
challenges and accomplishments are,
and one answer applies to both: the
port’s capital improvement program,
with efforts currently focused on the
Middle Harbor Redevelopment Project
and the Gerald Desmond Bridge Re-
placement Project. Both programs total
about $4.5 billion.
“In 2013, we spent $740 million on
capital improvements. That’s remark-
able,” Moro said, adding that this figure
was about 75 percent of the port’s total
fiscal year budget. “There is no other
port in the U.S. doing that,” he said of
the amount of the port’s infrastructure
investments. “This year we’re budgeted
for $780 million [for capital improve-
ment projects] and we’re going to come
pretty close to [spending] that.”
“The most notable” capital improve-
ment project in terms of its signifi-
cance to the port is the Middle Harbor
project, in Moro’s opinion. “This is the
redevelopment of what were two older
container terminals and combining
them into one,” he said of Piers E and
F, of which shipping line Orient Over-
seas Container Line’s (commonly re-
ferred to as OOCL) local division –
Long Beach Container Terminal
(LBCT) – is a tenant. “It’ll be about
300 acres in size when it’s done,” he
pointed out. “If that terminal alone
were a port . . . it would be something
like the fifth largest in the nation.”
When complete, the terminal may
handle the world’s largest container ves-
sels, Moro said. This ability is signifi-
cant to port business because vessels
able to carry upwards of 15,000 twenty-
foot-equivalent units are becoming in-
creasingly common. To support these
vessels, the port invested in deepening
its water channels and purchased what
Moro called “the world’s largest cranes”
capable of handling large amounts of
cargo. These cranes are undergoing test-
ing by LBCT, Moro said.
Also helping large vessels call on the
Port of Long Beach is the Gerald
Desmond Bridge Replacement Project,
in which the port is replacing the 1960s-
era Gerald Desmond Bridge with a
larger cable main-stayed bridge. Ac-
cording to Moro, the existing bridge’s
inefficiencies are that it has only two
lanes in each direction, lacks any break-
down shoulders and is not high enough
to let large ships pass beneath it.
The new bridge is designed for three
lanes of traffic each way and break-
down lanes on each side. “That’s signif-
icant because if a truck has a problem
today and it stalls or there is an incident,
the bridge basically shuts down,” he
said of the importance of breakdown
lanes to the new bridge’s design.
The new bridge’s height is going to
benefit port operations by allowing
larger vessels to enter the inner harbor,
Moro said, explaining that while the
existing bridge is 157 feet above
water, the new one will be 205 feet
above the water. The new bridge has a
completion date of 2016.
The port also has various railway
projects underway to build more work-
ing and storage tracks and rail support
facilities, Moro said. These capital im-
provement projects are key because the
port’s customers are increasingly reliant
upon rail as larger vessels come into the
port, he explained. “If we don’t have
that rail capacity, they may look for a
port that has more,” Moro said. Rail ex-
pansions are underway both at Middle
Harbor and in the Pier G terminal,
where International Transportation
Service, Inc. is located, he added.
Investing heavily in infrastructure helps
ensure that customers get what they want,
and what Moro most often hears from
customers is that they want reliability.
“They need to know that the infrastruc-
ture at the Port of Long Beach is capable
of moving that cargo at the speed neces-
sary to get to the consumer,” he said.
Leadership ChangesThe port’s search for a permanent ex-
ecutive director is in full swing now that
a national search firm has been hired and
Long Beach Harbor Commissioners Lori
Ann Farrell and Susan E. Anderson Wise
are serving as an oversight committee.
Moro said that the search firm recently
indicated that its candidate screening
process would be complete and that the
harbor commission would receive a list
of candidates by the end of May.
Moro took over as acting executive
director for the port last May, when his
predecessor Chris Lytle resigned to take
the leadership role at the Port of Oak-
land. Since then, there have been other
departures at the POLB, such as that of
Chief Financial Officer Sam Joumblat,
Director of Construction Management
Port of Long Beach Acting Executive Director Al Moro, P.E., has been leading the port since Julyof last year, when then-Executive Director Chris Lytle departed to head the Port of Oakland. Priorto that, Moro served as chief harbor engineer and assistant managing director of engineeringfor the port since 2007. (Photograph by the Long Beach Business Journal’s Thomas McConville)
Acting Executive Director Al Moro DiscussesChanges And Growth At The Port Of Long Beach
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2014 Focus On International TradeLong Beach Business Journal Page 5
Gary Cardamone and Managing Direc-
tor of Environmental Affairs and Plan-
ning Robert Kanter, who retired.
When asked how these changes in
leadership, which have mainly resulted
in appointing existing POLB staff
members as replacements, have af-
fected port operations, Moro replied, “I
think you can just point to what we’re
accomplishing to kind of be the answer
to that,” referencing the robust capital
spending program. Moro added that he
intends to stay on as acting executive di-
rector as long as the harbor commission
deems it necessary and at least until Au-
gust, when he estimated that the perma-
nent executive director would take over.
Other organizational changes are tak-
ing place within the port now that a pro-
fessional consulting group’s suggestions
are being implemented, including the re-
structuring of the engineering bureau so
it better serves large capital improve-
ment projects. The suggestion by PMA
Consultants is resulting in the hiring of
35 additional staff members in the engi-
neering department.
The Coming YearThe Port of Long Beach should expe-
rience a 2 percent to 3.5 percent in-
crease in cargo traffic this year, Moro
said. He noted, however, that the port
has conservatively budgeted for the
lowest likely increase of 2 percent.
This is a less robust growth in cargo
volume compared to 2013. “In 2013, the
port went up percentage-wise by 11.3
percent. That was pretty dramatic,”
Moro said, noting that 2013 was the
third busiest year in the port’s history.
“Some of the cargo growth that we had
in 2013 was a transfer of cargo from the
POLA,” he explained of the double-digit
growth. He did point out, however, that
some growth was related to increasing
exports. “We saw a lot of that new busi-
ness coming into Long Beach as ex-
ports, which is good for the U.S.A.” �
h
The ongoing work onthe Port of Long BeachMiddle Harbor projectis creating about1,000 temporary con-struction jobs annu-ally. Once the projectis completed, the portestimates that it willcreate approximately14,000 permanentjobs in Southern Cali-fornia. (Long BeachBusiness Journal pho-tographs by CarlosDelgado)
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2014 Focus On International TradeLong Beach Business Journal Page 6
� By SAMANTHA MEHLINGER
Staff Writer
T he Port of Los Angeles (POLA)
began the year on a positive note,
with a 7.5 percent increase in total con-
tainer traffic in the first quarter compared
to the first quarter of 2013. “I would at-
tribute it to wonderful shippers, superior
infrastructure here at the Port of Los An-
geles and a great logistics [system] of
moving cargo in and out of Los Angeles,”
Interim Executive Director Gary Lee
Moore told the Business Journal.
The outlook for the rest of the year is
for positive growth. “We had been pre-
dicting cargo volume increases of 2 to
3 percent in 2014,” Moore said, adding
that industry professionals are forecast-
ing more generous growth. “I was just
in Asia last week and one of the ship-
pers said 3 to 4 percent [cargo volume
growth] while another said 5 to 6 per-
cent,” he stated.
Infrastructure InvestmentsThe Port of Los Angeles continues
to invest in infrastructure improve-
ments for its terminals, through its rail
projects and on its roadways, Moore
said. “We are spending $1 million a
day right now” on these capital im-
provement projects, he emphasized,
calling the spending “a great accom-
plishment.” The total projected spend-
ing on capital improvements this year
is $399.9 million.
One of POLA’s largest projects is
improving the TraPac Terminal at a
cost of $510.3 million. That project,
approved in 2009, involves creating
4,600 linear feet of new wharves,
deepening berths, installing new
cranes, modernizing 50 acres of back-
lands and installing an automated sys-
tem for moving cargo on dock.
Moore called the POLA’s collabora-
tion with TraPac on aspects of the proj-
ect “a true partnership,” explaining
that while the POLA is investing in the
automated cargo movement system’s
infrastructure, TraPac is purchasing the
actual equipment that moves the con-
tainers. The project is partially com-
pleted, with about $85.8 million in
spending planned for this year. Future
portions of the project, including relo-
cating a recycled water line and an ad-
ditional five-acre backland expansion,
are still in the design phase.
Another capital improvement proj-
ect currently underway is the $156.3
million Berth 200 Rail Yard Project, in
which a rail yard is being modernized
for use by Pacific Harbor Line (PHL),
a company that provides rail trans-
portation, maintenance and dispatch-
ing services to the San Pedro Bay
ports. The company is relocating from
its existing location at the TraPac ter-
minal and is being given more rail
space and a new headquarters building
at Berth 200. The majority of this pro-
ject’s budget is funded by federal and
state grants.
With the Berth 200 project, the
POLA aims to help efficiently move
more cargo through the Alameda
Corridor, Moore explained. The
move is mutually beneficial, as the
space PHL is vacating is being con-
verted into an on-dock rail facility
for TraPac. The project is also gener-
ating about 2,000 direct and indirect
jobs, according to the POLA.
Various roadway improvement proj-
ects are also underway throughout the
port area, Moore said. Three major
roadway projects are ongoing, one of
which aims to improve the flow of traf-
fic from the I-110 Freeway ramps at C
Street “by consolidating two closely-
spaced intersections and facilitating
heavy right-turn volumes with free-
flowing turn lanes,” according to the
POLA. This $50 million project also
improves connectivity to Figueroa
Street and Harry Bridges Boulevard.
Another ongoing roadway project in-
volves adding a lane from the State
Route 47 connector to the northbound
I-110 Freeway, extending an off-ramp
and adding lanes at John S. Gibson
Boulevard. The $19.9 million project is
also intended to alleviate traffic conges-
tion and improve freeway connectivity.
Port Of Los Angeles’ Gary Lee Moore HighlightsIncreased Container Traffic And Investments
Port of Los Angeles Interim Executive Director Gary Lee Moore has been leading the port since last November. He said that his priority is to make sure port operations continue movingforward during this transitional period in leadership. (Photograph by the Long Beach Business Journal’s Thomas McConville)
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2014 Focus On International TradeLong Beach Business Journal Page 7
The third roadway project currently
in progress is the $70 million South
Wilmington Grade Separation Project.
“That project is bringing the roadway
across the railroad track to . . . prevent
back ups around our different termi-
nals,” Moore explained. The project
creates grade-separated vehicular ac-
cess to the South Wilmington area,
which should reduce traffic delays and
increase pedestrian safety, according
to the POLA.
One of the port’s most significant
projects in terms of duration and ex-
pense was completed last year – the
$372 million Main Channel Deepen-
ing Project, which resulted in a
deeper harbor to accommodate larger
vessels. “It was a big accomplish-
ment for us to complete that project,”
Arley Baker, senior director of com-
munications for the POLA, told the
Business Journal.
The POLA’s goal for investing in
these capital improvement projects is
to create “a great infrastructure,”
Moore said. “We always need to keep
ahead of other cargo gateways and we
want to remain No.1, so we’re invest-
ing and putting ourselves in good
shape to accommodate the future large
ships and larger cargo volumes that
will be coming,” he explained.
Leadership ChangesA good deal of turnover in leader-
ship at the POLA has occurred in re-
cent months, with Moore stepping in
as interim executive director last No-
vember and with Los Angeles Mayor
Eric Garcetti appointing four new
members to the board of harbor com-
missioners in October. Overall,
Moore said that the leadership transi-
tions are going well.
Moore pointed to the POLA’s in-
creasing cargo volumes to illustrate
that the leadership transition has been
smooth and positive for the port, not-
ing that cargo traffic through the
POLA has increased by 3.8 percent in
the past nine months.
Since stepping into the leadership
role, Moore has met with all of the
port’s customers and taken two trips to
Asia and a trip to South America for
trade and customer relations, he said.
The search for a permanent executive
director is progressing – the deadline
for applications was April 14 and a se-
lection should be made within the next
two months, Moore said.
The harbor commissioners have also
been “fantastic” since stepping into their
roles, Moore said, emphasizing that the
diversity in backgrounds of the commis-
sioners and the amount of hours they are
putting into the job are “impressive.”
The FutureWhile the port is forecasting positive
growth this year, Moore said it is im-
portant to remain proactive in its cus-
tomer relations as major shipping lines
begin to form alliances, such as the one
among CMA-CGM, Mediterranean
Shipping Co. and Maersk Line.
Moore called the trend of vessel shar-
ing and shipping alliances “a new hori-
zon” both for ports and shipping
companies as those companies reevalu-
ate where their vessels call port and
where cargo is routed. He emphasized
that the POLA is “controlling what we
can control” as these alliances form by
investing in infrastructure and improv-
ing terminal and logistics efficiencies. �
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2014 Focus On International TradeLong Beach Business Journal Page 8
� By SAMANTHA MEHLINGER
Staff Writer
T o keep the nation’s largest com-
bined port complex safe, security
officials recognize that they must work
together to constantly keep abreast of
potential threats and to ensure that they
are prepared to efficiently respond to
those threats.
Two leaders in security at the twin
ports – the Port of Long Beach’s
(POLB) Director of Security Randy Par-
sons and Ronald Boyd, interim deputy
executive director of operations at the
Port of Los Angeles (POLA) and chief
of port police – spoke to the Business
Journal about the greatest security chal-
lenges facing the ports today and how
they are working to stay on top of it all.
Challenges And StayingAhead Of Threats
In Parson’s view, one of the most sig-
nificant challenges in maintaining port
security is effectively communicating
with international counterparts. “I think
the greatest challenge as it relates to in-
ternational trade is receiving timely and
accurate information from our trade
partners overseas,” Parsons stated.
Port security personnel collect infor-
mation about vessels leaving foreign
ports for the San Pedro Bay because the
“perimeter of protection” around our
local ports extends to the visiting ves-
sels’ points of origin, Parsons said. In
addition to relying upon foreign entities
to provide information about a vessel,
its cargo and its crew, Parsons said, “the
sharing also has to include information
about any nefarious activity that is ob-
served in those foreign ports.”
Once POLB’s security team receives
information about an incoming vessel,
the team tracks the vessel and observes
its maneuvers, Parsons said. “Monitor-
ing their progress across the ocean as
they approach Long Beach and Los An-
geles is very important,” he stressed.
Suspicious activity is usually apparent
because “international trade is a crea-
ture of habit,” Parsons said. “People
know what boats are supposed to be
carrying, where they are going, how
long they are going to be there and, very
importantly, what routes they take.”
If any of those factors veer from the
norm, if any crewmembers are flagged
in intelligence databases, if the vessel
visits a country that is “of interest from
a national security perspective,” or if
other changes to the vessel occur such as
a change of ownership, that vessel may
be more closely monitored, Parsons said.
“With satellite coverage, radar capa-
bilities and technological advances, it is
pretty easy to track the vessels,” he said,
but emphasized that getting the infor-
mation necessary to determine whether
or not a vessel needs to be more closely
monitored is the real challenge. Having
to do so is “not an every day occur-
rence, but it’s not rare either,” he added.
Another major challenge for port se-
curity is “being prepared for all types of
hazards in a very uncertain atmosphere,
such as we are in today,” Boyd said.
While an obvious threat to the port is
sponsored terrorism, there is a growing
occurrence of what Boyd called “organic
threats,” citing the shooter that recently
terrorized a Los Angeles International
Airport (LAX) terminal and last year’s
Boston Marathon bombing.
“You have these very asymmetric
warfare-type thinkers that are making
attacks on public venues and activities,”
Boyd observed. While he said that the
Port of Los Angeles has “built up capa-
bilities toward active shooters and ter-
rorist-type activities” through “months
of exposure, training and discussions
post-9/11,” he noted, “there always
seems to be that one element that no
one has contemplated or prepared for.”
Boyd is particularly concerned about
the potential for an active shooter event,
similar to the recent one at LAX, to occur
in a cruise ship terminal, pointing out that
these terminals are not unlike those found
in airports. “I know that the City of Long
Beach and the City of Los Angeles have
taken a lot of measures to try to prevent
something like that, including training
and public information and also working
with the cruise line operators,” he said.
To try to stay ahead of new security
threats, Parsons said POLB staff does
something simple – “We watch CNN,”
he said. “What we do is try to be proac-
tive by observing the world’s activities,”
he explained, using the current tensions
between Russia and Ukraine over Rus-
sia’s annexation of Crimea as an exam-
ple. “The first thing we start to think
about is, what kind of vessels do we
have calling from Russia, Ukraine and
Crimea?” If an anomaly occurs on a
vessel crewed by individuals “from a
country that is under strife with a lot of
Keeping The Ports Safe Through Awareness, Collaboration And Technology
Randy Parsons, director of security for the Port of Long Beach, has a long history of security service at the national and local level. After 20 years in the Federal Bureau of Investigations,Parsons became federal security director of the Transportation Security Administration at the Phoenix Sky Harbor International Airport and later at the Los Angeles International Airportbefore joining the Port of Long Beach in 2012. (Long Beach Business Journal photograph by Carlos Delgado)
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2014 Focus On International TradeLong Beach Business Journal Page 9
political upheaval or military concerns,”
then the port would keep a closer eye on
that vessel, he explained.
CollaborationThe Ports of Long Beach and Los An-
geles employ and work with multiple
agencies that collaborate to keep the
ports secure.
At the POLB, port security, the Long
Beach Police Department and the Long
Beach Fire Department are all present on
site in the Joint Command Control Cen-
ter (JCCC) at Pier F, Parsons said. “That
is where all three of those agencies sit
down on a daily basis and discuss
what’s going on,” Parsons explained.
“We have regular meetings where we
share information about threats and in-
cidents that have occurred,” he said,
adding that this information pertains to
local, regional, statewide, national and
even international issues.
In addition to its own port police, the
Port of Los Angeles lists the Los Ange-
les Police Department, Los Angeles
County Sheriff ’s Department and Los
Angeles Fire Department, as well as
Long Beach’s security entities, as part of
its security force. Both ports also collab-
orate with state and federal security
agencies such as the California High-
way Patrol, the U.S. Coast Guard and
U.S. Homeland Security. Boyd, who also
chairs the International Association of
Airport and Seaport Police, said that this
level of collaboration among govern-
ment agencies is “at times unheard of.”
Investing In A Secure FutureAs security threats evolve, so does
technology, and both ports continue to
seek opportunities to invest in technol-
ogy that can better improve port safety.
Some time in the next two months, the
Port of Long Beach will roll out a system
called Virtual Port that will enable its se-
curity team to combine datasets from 20
open-source databases to create a real-
time virtual picture of the port complex.
Parsons explained that these databases
contain information about all aspects of
the ports, such
as vessel loca-
tions, water cur-
rents, weather,
the location of safety vehicles or per-
sonnel, the locations of ongoing inci-
dents and more. “Virtual Port stacks
these databases . . . to get a better view
of what is happening,” he said. The sys-
tem may cost as much as $8 million
when completed.
Virtual Port has three main purposes:
daily situational awareness, incident re-
sponse and business recovery, Parsons
said. Situational awareness simply
means knowing where everything
within the port is occurring. The system
aids in incident response by allowing
security officials to identify which se-
curity entities are closest to any occur-
ring incident and prioritize which to
dispatch. The technology may also as-
sist with business recovery by, for ex-
ample, layering datasets of vessel
locations near a fire incident. “That
data layering helps an incident com-
mander know the fire is right next to a
big ship loaded with oil that is right
next to an electrical substation,” Par-
sons, as an example, illustratred.
The Port of Los Angeles is also exam-
ining ways it may enhance its security
efforts, such as by expanding its blue
force tracking capabilities, which use
GPS to track the locations of the vari-
ous entities within the port. Boyd also
hopes to improve upon technological
communication with the public to make
it more two-way, so that the public may
more easily provide security tips or in-
formation to the POLA.
“The more we can shorten the com-
munication gap and the more we can
be responsive with the people we
serve, the better off we will all be,”
Boyd stressed. �
Ronald J. Boyd, interim deputy executive director of operations for the Port of Los Angeles and chief of Los An-geles Port Police, is flanked by three vessels used by Port of Los Angeles security personnel. Pictured from leftare the Maritime Law Enforcement Training Center’s Metal Shark vessel, the port police dive team’s vessel anda Port Police SAFE boat used for patrol. At right, The United States Coast Guard keeps watch as a tugboatguides a vessel in the San Pedro Bay port complex. The Port of Long Beach and Port of Los Angeles have onsitesecurity teams that collaborate with one another as well as state and federal agencies to keep the ports safe.(Photographs by the Long Beach Business Journal’s Thomas McConville)
1_INT'LTRADE_2014_Layout 1 4/26/14 7:24 PM Page 9
Long Bea 2014 Focus On International TradeLong Beach Business Journal Page 10
� By TIFFANY L. RIDER
Editor
A s departments of the cities of
Long Beach and Los Angeles, the
twin ports on the San Pedro Bay ac-
tively engage with the surrounding
community through various programs,
many of which provide critical efforts
to clean up the environment.
“We had to learn the hard way
through a clash with the community in
the 2000s that the only way we could
grow is to grow green,” Christopher
Cannon, director of environmental
planning for the Port of Los Angeles
(POLA), told the Business Journal.
Backlash from the region’s commu-
nity groups over significant pollution
coming from both ports resulted in
new efforts by the ports to reduce con-
tributions to poor air and water quality
in the Los Angeles Basin.
To be successful in the community,
the ports must grow business in a sus-
tainable fashion, according to Rick
Cameron, managing director of envi-
ronmental affairs and planning for the
Port of Long Beach (POLB). To do so,
the POLA and the POLB together es-
tablished the San Pedro Bay Ports
Clean Air Action Plan and produced
an annual “green” report card.
“Each year we do an emissions in-
ventory of all port-related sources
that are here,” Cannon explained, not-
ing the report card has been issued
each year since 2005. “It’s a painstak-
ingly detailed effort.” The ports ex-
amine emission cycles, operating
hours, fuel usage and other metrics
for various modes of transportation
including rail, truck and watercraft.
“We’ve had tremendous success in
reductions,” he said.
Cameron echoed, “We never envi-
sioned that we would be so far ahead
of what we had projected.” A signifi-
cant part of that, Cameron said, is
credited to the Clean Trucks Program,
which required all vehicles with pre-
2007 engines to be replaced with
clean motors that emit 80 percent less
air pollution (diesel particulate matter)
than older trucks. The program, which
kicked off in October 2008, reduced
air pollution from harbor trucks by
more than 90 percent by 2012.
Another factor is the transition to
zero-emission cargo handling equip-
ment at both ports, as well as efforts
by the rail lines to upgrade their lo-
comotives to run the least polluting
engines available. Both trucks and
trains enter and exit the ports daily,
running through communities along
the Alameda Corridor and I-710,
Cameron noted. “We are making a
lot of progress,” he said. “Over the
course of the last 10 years, the two
ports and PHL (Pacific Harbor Line)
have worked to modify the 16 loco-
motives that make up the PHL fleet.
About a year ago, PHL upgraded the
engines on the 16 locomotives to a
tier-3 plus engine. It’s the cleanest
locomotive engine available, and
PHL has become the cleanest short
line rail around.”
In addition, construction projects at
both ports must meet best manage-
ment practices in order to minimize
environmental impacts. “We have
been leaders in developing standards
for marine ports,” Cameron said, not-
ing the POLB engineering division de-
veloped standards to implement sus-
tainable design and construction for
future marine terminals. Some of the
now-standard sustainable design and
construction methods include reusing
dredging materials for site fill and
processing and reusing asphalt and
concrete. Both practices reduce the
need for truck trips, meaning less air
pollution and more sustainable devel-
opment, Cameron said.
Moreover, Cannon explained that
the construction equipment is being
replaced with zero-emission technolo-
gies. “Dredging equipment has to be
electric to the greatest extent possi-
ble,” Cannon said. “All barges and
ships that deliver construction related
materials have to comply with our ves-
sel speed reduction program within 40
miles and use low-sulfur fuel 40
miles. . . . Construction equipment
must meet the standards of the Clean
Trucks Program. We require [these] as
part of our sustainable construction
guidelines.”
Ship-to-shore power regulations as
well as other emissions and fuel stan-
dards from the California Air Re-
sources Board now in effect support on-
going efforts to improve air quality.
Cannon described these efforts as a
combination of support from the San
Pedro Bay Ports complex, the business
community and the regulatory commu-
nity. “It has been a collaboration be-
tween the three and I think because of
that collaboration we have been able to
be successful,” he said. “We continue to
monitor developments to push for even
newer technologies to reduce emissions
and [are] working with our partners and
our tenants in the terminals to test new
technologies all the time.”
In addition to new technologies, the
ports continue to make investments in
the community that build on the ports’
sustainability efforts. The POLB
makes those investments through a
community mitigation grant program,
according to Cameron. “The mitiga-
tion grants program came out of the
mitigation for Middle Harbor,” a bil-
lion-dollar project to combine two
aging terminals into a single, sustain-
able and technologically advanced ter-
minal, he said.
The POLB has invested $15 million
in mitigation funding grants to
schools, health care organizations and
greenhouse gas emission reduction
projects outside of the port. One such
project, a van for St. Mary Medical
Center in Long Beach, provides mo-
bile respiratory diagnostic services to
the community. “We can’t buy in-
halers for every person who has
asthma in the region, but we can pro-
vide care and diagnoses to help them
get help,” Cameron said. “That really
has been a successful program.”
Cannon said the POLA has spent
more than $30 million on environ-
mental benefits for the community for
both aesthetic and air mitigation pur-
poses. Projects include building sev-
eral parks in San Pedro,
improvements at Cabrillo Beach, and
upgrades at the Los Angeles Maritime
Museum and at Point Fermin Light-
house. “We continue to spend about
$23 million a year on community ben-
efits,” Cannon said.
Twin Ports Use Sustainability Programs, Grants To Clean Up Regional Environment
As both economic engines and environmental stewards, the ports of Long Beach and LosAngeles work together to ensure the wildlife habitats in the San Pedro Bay are supportedand preserved. The map above shows where such habitats are located within the twinports complex. (Image courtesy of the Port of Los Angeles)
1_INT'LTRADE_2014_Layout 1 4/26/14 7:24 PM Page 10
Long Beach Business Journal Page 11
“A big part of what we do is to try
to make the area around the port a
compatible place to live relative to the
port,” he continued. “In other words,
our idea is that part of being sustain-
able and environmentally responsible
is recognizing that you have a com-
mitment to the living environment
around the port, not just stuff coming
out of smokestacks. It’s also quality
of life. Those [ideas] are really impor-
tant to us.”
Quality of life improvement efforts
extend beyond land, and the twin
ports’ water resources action plan also
supports aquatic life in the San Pedro
Bay. “[The action plan’s] purpose is to
work on compliance issues and sedi-
ment quality issues and overall man-
agement practices to make sure that
ships and other entities operating here
in our bay do so in a way that protects
the environment,” Cannon said.
Both the POLA and the POLB
work with port tenants to identify
and control storm water runoff and to
make sure unclean water is not dis-
charged. One control works by using
treatment systems called catch
basins, which are installed at tenant
operations to separate oil from the
water runoff. These catch basins trap
pollutants before they can reach the
bay, Cannon said.
The twin ports’ policies on clean
water have evolved not only to focus
on water improvements within the
port, but also on engaging other stake-
holders with regard to broader issues,
Cameron explained, noting, “We are
part of the larger watershed.” Tenants
at both ports each have a storm water
plan. Port officials work with the ten-
ants, performing site visits to ensure
the tenants are implementing clean
water measures.
To monitor progress, the ports con-
duct a biological survey every five
years or so to look at marine biology
life in the San Pedro Bay. “The abun-
dance and variety has skyrocketed,”
Cameron said of the aquatic life.
“That is a result of the really good
water quality that we implore.” �
1_INT'LTRADE_2014_Layout 1 4/26/14 7:24 PM Page 11
2014 Focus On International Trade
E fforts by the South Coast Air Quality
Management District (AQMD) to reg-
ulate the ports of Los Angeles and Long
Beach as stationary entities would increase
the cost of doing business at the ports, ac-
cording to port officials.
The California Air Resources Board
regulates the San Pedro Bay Ports as a mo-
bile source of air pollution, according to
Christopher Cannon, director of environ-
mental planning for the Port of Los Ange-
les. The AQMD does not have authority to
regulate mobile air pollution sources
statewide – only stationary sources, like
power plants, located in the South Coast
region. The South Coast, according to
AQMD maps, includes communities
below the Tehachapi Mountains, the Ange-
les National Forest and the San Bernardino
National Forest; communities above the
Santa Ana and San Jacinto mountain
ranges; and communities extending to
Joshua Tree National Park.
The air quality in the South Coast is the
worst in the United States, Cannon noted.
Since well over half of the air pollution
sources in the region are mobile sources,
the AQMD is stuck trying to figure out
ways to expand regional environmental
regulation by grouping mobile sources to-
gether and calling them a stationary
source. “We don’t think they have the ju-
risdiction,” Cannon said. “It’s going to be
a fight. We can’t have the AQMD put us
under a bubble.”
Under that bubble, Cannon explained, the
port would control everything that operates
at the port or be subject to the AQMD. “We
think that’s crazy because we don’t control
those sources,” Cannon said. “We are a
landlord port. We lease land. We have the
ability to control a little bit what our tenants
do, but we can’t control them the same as if
we owned and operated the equipment. I
understand where [the AQMD] is coming
from, but I vehemently disagree with it.”
The regulations, which are currently in
draft form, provide a backstop to emission
reductions committed to by the ports, ac-
cording to Henry Hogo, assistant deputy
executive officer of science and technology
advancement for the AQMD.
The only requirements the AQMD is
asking of the ports through this regulation,
he said, is to have the ports submit reports
on their annual emissions, which they do
annually to their respective boards. If the
ports’ emissions reductions are on target
with what the AQMD forecasts, the agency
would not seek additional emission reduc-
tions, Hogo said.
“The ports have done a tremendous job
reducing emissions from the sources at
the port,” Henry said, noting that those re-
ductions are reflected in AQMD’s air qual-
ity management plan. “We need an
insurance policy that those reductions are
maintained in the future. In the event
those policies go awry, we are establishing
a mechanism so the ports could continue
[emission reduction efforts].”
Barbara Baird, chief deputy counsel for
the AQMD, said the agency does have au-
thority to regulate the ports when defining
them as indirect sources of pollution. State
law, in statute, allows the AQMD to regulate
indirect sources, which are defined in the
federal Clean Air Act as a facility, building,
structure, installation, real property, road or
highway, which may attract mobile sources
of air pollution. “Our interpretation is that
the port is an indirect source,” she said.
When asked about these rules as being
potentially creating an unfair playing field
among all West Coast ports by regulating
only the Port of Long Beach (POLB) and
the POLA, Baird said, “It would be an un-
fair to other sources in the district if the
port were not regulated.”
The AQMD staff recently closed a
comment period on the draft rule lan-
guage, is reviewing those comments and
is preparing responses to comments. A
draft environmental assessment should be
released soon, as well as any modifica-
tions to the original proposal, according
to Baird. “We anticipate going to our
board in July at this point in time,” she
said. “We may delay that if necessary in
order to solicit additional input.”
POLB Managing Director of Environ-
mental Affairs and Planning Rick
Cameron said there is a different way to
deal with air pollution than AQMD’s ap-
proach. “AQMD proposals would send us
backwards,” he told the Business Journal.
“The right agencies should be regulating
us and there should be a process that does-
n’t just regulate one community or pit one
port against another.”
Other ports across the state and those
outside California are using the fact that
AQMD rules create a more restrictive
business climate as leverage to woo ten-
ants away from the San Pedro Bay Ports
complex, Cannon said. “It is important
that planning for control of emissions of
port-related sources occur statewide so
you have a level playing field,” he said.
“That level of planning really should be
happening nationwide.” �
– Tiffany Rider, Editor
2014 Focus On International Trade
Draft Air Quality Regulations For The South Coast Could
Hurt Port Business� By SAMANTHA MEHLINGER
Staff Writer
“I t’s the best of times and the
worst of times for trade
policy,” according to U.S.
Chamber of Commerce Vice
President of International Af-
fairs John Murphy, who is
speaking at the Long Beach
Area Chamber of Commerce
World Trade Week Luncheon
on May 22.
Murphy gave the Business Journal a
glimpse into his talking points for the lunch-
eon and why he decided to sum them up
with Dickensian flair. Principally, Murphy’s
concerns for the country’s international
trade business hinge on how the United
States Congress acts on two key items:
Trade Promotion Authority and a reautho-
rization of the Export-Import Bank of the
United States.
“One of the issues I plan to put at the fore
is the need for Trade Promotion Authority
(TPA),” Murphy said in a phone interview
with the Business Journal. Trade Promotion
Authority is a legislative policy that gives
the president authority to negotiate interna-
tional trade agreements that Congress may
subsequently approve or disapprove without
amending or filibustering. TPA was created
in 1974 as a way to uncomplicate trade re-
lations. “The issue is that the Constitution
gives to the Congress the authority to regu-
late international commerce, but it gives to
the executive branch the ability to negotiate
with foreign countries,” Murphy explained.
The TPA expired in 1994, was brought
back under George W. Bush’s tenure in the
White House beginning in 2002, ended
prior to his exit in 2007 and was never re-
stored. Since entering office, President
Barack Obama has been working to negoti-
ate two major trade agreements, including
the Trans-Pacific Partnership (TPP) with 11
Pacific Rim countries and the Trans-At-
lantic Trade and Investment Partnership
(TTIP) with the European Union. The prob-
lem is that without TPA, President Obama
cannot ensure that the agreements will be
fast-tracked through Congress.
“It is really important because other gov-
ernments are reluctant to negotiate a trade
agreement with the United States if they
think it is going to later be picked apart by
Congress,” Murphy said of TPA. “They
want to negotiate it once, not once with the
president and then again with the 535 mem-
bers of Congress.”
A bill to establish executive TPA, called
the Bipartisan Congressional
Trade Priorities Act of 2014,
was introduced to Congress in
January. Murphy is concerned
about its prospects of passing,
despite the bill’s bipartisan
sponsorship. “It is a tough
issue for quite a few members
[of Congress] and particularly
for Democrats, and there
seems to be some reluctance to
move forward with it before
the election in November,” he observed.
The U.S. Chamber has been “ramping up”
its advocacy for the legislation because doing
so would help the TPP and TTIP progress,
giving a boost to U.S. businesses and helping
the U.S. remain competitive with other coun-
tries which are negotiating their own trade
agreements, Murphy explained.
“What American business needs right now
is customers,” Murphy said. “If you look
across the Pacific, you’ll find that there are
two billion new middle class customers in
Asia and by 2020 there will be another billion
. . . American companies want to get a piece
of the action,” he emphasized, adding that the
TPP would open the door to that market.
The TTIP could also benefit the U.S. by
lowering its already lenient trade barriers
with the European Union. “The flow of
commerce between the U.S. and the Euro-
pean Union is so large that even eliminating
these relatively low barriers could have a
huge economic benefit,” Murphy stated.
“Already, there is about $1 trillion worth of
trade across the Atlantic every year and on
top of that, about $5 trillion worth of earn-
ings by foreign affiliates . . . In fact, it is es-
timated that about 15 million American and
European jobs depend on this relationship.”
Apart from passing the TPA bill, Murphy
said he is also advocating for Congress to
reauthorize the Export-Import Bank of the
United States (Ex-Im Bank), which pro-
vides trade financing for U.S. exporters.
“Ex-Im’s charter expires on September 30
of this year so Congress needs to pass a bill
to reauthorize it,” Murphy said. “It is very
important for providing finance to U.S.
companies which often are in competition
with companies based elsewhere that enjoy
favorable financing from their own national
export credit agencies. So it’s a big priority
for us as well.”
Approving the TPA Bill and reauthorizing
the Ex-Im Bank are among Murphy’s top pri-
orities for improving U.S. international trade
business and, he stated, represent “the biggest
opportunity to tear down some of the barriers
that stand in the way of U.S. exports.” �
U.S. Chamber’s Murphy ToDiscuss Trade Policy Priorities
At Long Beach Chamber Luncheon
1_INT'LTRADE_2014_Layout 1 4/26/14 7:24 PM Page 12
Long Beach Business Journal Page 13
Mattel CEOBryan StocktonTo Speak At L.A.Chamber WorldTrade WeekBreakfast
� By SAMANTHA MEHLINGER
Staff Writer
B ryan Stockton, CEO and chairman of
toymaker Mattel, Inc., is the keynote
speaker at the Los Angeles Area Chamber
of Commerce’s World Trade Week Kickoff
Breakfast on May 2 at the JW Marriot at
L.A. Live.
As the leader
of a company
e m p l o y i n g
nearly 30,000
workers across
40 countries,
Stockton will
discuss how in-
ternational trade
plays a major
role for his com-
pany. According to talking points for his
World Trade Week speech provided by Mat-
tel, Stockton plans to address how technol-
ogy has changed over the past decade in
ways that enable companies to have un-
precedented communication with cus-
tomers, the media and their stakeholders.
Stockton will emphasize that despite the
changes in digital and social platforms, Mattel
must focus on its core fundamentals, such as
“creative execution and unparalleled innova-
tion.” He is expected to discuss how a chang-
ing business environment interplays with
these fundamentals and how understanding
that has helped fuel the company’s success.
Stockton also serves as chairman of the
company’s board of directors, a role he as-
sumed in January 2013. Mattel has annual
revenues in excess of $6.2 billion, opera-
tions in more than 40 countries, and sells
products in more than 150 countries world-
wide. Stockton, according to a company
statement, is building upon Mattel’s success
over the past decade to align the global or-
ganization and execute the strategic initia-
tives required to be the largest, most
profitable and innovative toy company in
the world, driving sustainable growth and
innovation across the business to leverage
the company’s scale and global structure.
Prior to being named Mattel’s sixth CEO
in early 2012, Stockton was Mattel’s chief
operating officer. He had responsibility for
all of the company’s sales and operations,
which included Mattel Brands, Fisher-
Price, American Girl and Mattel Interna-
tional, as well as the worldwide operations
and corporate responsibility divisions. He
was president of $3 billion Mattel Interna-
tional before 2011, having led and grown
Mattel’s international operations over the
previous seven years.
Stockton joined Mattel in November
2000 as executive vice president of business
planning and development. In that role he
was responsible for identifying and devel-
oping strategic opportunities for the com-
pany, as well as managing all merger and
acquisition activity.
Stockton earned a BS degree with honors
in business from Indiana University and a
Masters of business administration degree
from the Indiana University Graduate School
of Business. He served on the board of Bob
Evans Farms, Inc. from 2006 to August 2012;
held a variety of senior leadership roles on
the Toy Industry Association, including two
years as chairman; was a member of the
board of Mattel Children’s Hospital UCLA
from 2001 to April 2010; served as chairman
of World Trade Week Southern California;
and currently serves as a member of the pres-
ident’s advisory council at Otis College of Art
& Design; UCLA Anderson School Board of
Visitors; and the board of directors of the
2015 Special Olympics World Summer
Games Los Angeles. �
ssional
f 2014,
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ou look
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gress to
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horizing
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biggest
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” �
s
on
1_INT'LTRADE_2014_Layout 1 4/26/14 7:24 PM Page 13
2014 Focus On International TradeLong Beach Business Journal Page 14
� By MICHAEL GOUGIS
Contributing Writer
W hen it’s dinner time for a cow in the
United Arab Emirates or for a
chicken in China, it is more and more likely
that the food for the critter has come from
the United States.
And 15,000 to 20,000 oceangoing con-
tainers filled with that grain, hay and other
livestock feed comes through the Los Ange-
les Harbor Grain Terminal each year. Every
day, container after container is filled with
grain from the Midwest and hay from across
the West, shipped out to the ports in the Los
Angeles Harbor and makes its way across
the oceans to help feed a hungry world.
The terminal’s destinations are scattered
across the globe, and its products are
equally diverse. That’s not an accident, but
a part of the company’s conservative, solid
business plan, says Dwight Robinson, Los
Angeles Harbor Grain Terminal vice presi-
dent (and also the mayor of Lake Forest in
Orange County).
“We are looking for steady, incremental
growth,” Robinson says. “You’re not trying
to hit a home run, you’re trying to build a
solid business.”
The company was founded in 1958 as
Mortimer & Wallace, and at first specialized
in the export of animal fats and vegetable
oils from Berth 174 in the Port of Los An-
geles. In the 1960s, the company added a
grain elevator to its operations, and loaded
ships with grain, vegetable oil and animal
products. Later that decade, as containerized
shipping became prominent, the company
started “transloading” – moving products
like grain from a rail car into an ocean-going
container. And as containerized shipping
virtually took over trans-oceanic shipping,
the company found that its transloading
services were in great demand.
Today, the company employs about 65
people and operates on revenues of $7 mil-
lion to $10 million annually, Robinson says.
And the backbone of the operation is its
transloading service.
“About 80 percent of our business is
transloading rail cars that are loaded in the
Midwest with agricultural commodities,”
Robinson says. “The other 20 percent of
the business is agricultural products that
are trucked in from the Western United
States, typically no further than about Salt
Lake City. It’s just more economical to
truck it in from that far than to rail it in. But
anything further east of that, or east of
Phoenix, comes in by rail.”
Railroad grain hopper cars dump their
loads into a conveyor system at the two-acre
facility in the “overweight corridor” on
Sepulveda Boulevard, which then loads the
material into the oceangoing containers.
For those commodities that come from the
West, the company offers “cross-docking”
services. That means, literally, taking stuff out
of a truck container, fork-lifting it across the
dock, and placing it into an ocean container.
The company also operates a fleet of 13
trucks that are specially designed to carry
high-weight containers, Robinson says.
“We run the trucks both day and night to
try to fully utilize them. The loaded contain-
ers go in (to the ports) at night more than 90
per cent of the time (to avoid the Pier Pass
fees, which are collected from shipments
that arrive at the ports from 3 a.m. to 6 p.m.)
“Our business is located in the over-
weight corridor, so we use those four-axle
trucks to allow us to fully utilize the over-
weight corridor. Agricultural commodities
are low-margin products, so they’re always
trying to reduce their cost in any way they
can. They want to get as much weight into
the container as they can.”
Much of the material the company han-
dles goes to Asia, where, thanks to the cur-
rent state of the infrastructure in those
emerging environments, the cost of buying
grain from the U.S. is the best bargain in the
world – literally.
“There’s really been a renewed interest in
the export of grain, specifically in contain-
ers, over about the last seven to eight years.
A lot of that has to do with the emerging
middle class in Asia, specifically in China
but throughout Southeast Asia as well,
Malaysia, Thailand and other countries.
They’re really interested in getting Ameri-
can agricultural products that they can use
for feed for their protein sources, such as
chickens, cows and pigs,” Robinson says.
If you’re thinking that China has plenty
of land to grow its own grain, you’re right.
But available geography is only part of the
picture.
“The challenge is (China’s) domestic in-
frastructure,” Robinson says. “If you think
about the United States, we started on one
LA Harbor Grain Terminal: The Gateway To A World Of Grain
Dwight Robinson, vice president of Los Angeles Harbor Grain Terminal, is pictured by railcarsfilled with bales of alfalfa. The alfalfa is grown in the U.S., offloaded from the railcars, putinto containers and shipped to China. (Photograph by the Long Beach Business Journal’sThomas McConville)
1_INT'LTRADE_2014_Layout 1 4/26/14 7:24 PM Page 14
coast and we moved all the way across to
the other. So we built a domestic infrastruc-
ture, primarily rail, in the 1800s, to move
goods across the country. (China) doesn’t
have that. Their population centers are pri-
marily on the east coast of the continent.
The land on the interior – they don’t have
the infrastructure to utilize it.
“If you look out 40 or 50 years, they might
develop the infrastructure to more fully utilize
their vast lands in the western part of the
country. But at this point, it’s actually cheaper
for them to purchase American commodities
that are grown in the Midwest, railed to the
West Coast and then shipped to them.”
Another growth area has been the Middle
East, Robinson says.
“There’s been a serious interest in alfalfa
hay in the past five or six years from the
Middle East, primarily the United Arab
Emirates, and also China,” he says. “That’s
primarily a commodity that’s been domi-
nated by the Japanese market. We were
shipping them alfalfa hay, and they were
shipping us back a little bit of Kobe beef!
“That changed because about five or six
years ago, when the United Arab Emirates
changed their political philosophy about
wanting to grow everything in the Middle
East. They started looking at what their costs
really were to produce feed, specifically al-
falfa and hay. They found out that they were
subsidizing water and irrigation to the farms
to such a degree that it was cheaper for them
to buy that hay from the U.S. and Australia
and ship it to them by ocean container. That
had a dramatic impact on the hay industry
on the western part of the United States.”
Such a shift illustrates perfectly why the
company deliberately works with a wide va-
riety of products and consumers.
“We try to keep the business pretty di-
verse. What that means is working with a
variety of commodities and working with a
variety of different destinations. So we try
to make sure that no commodity is more
than 25 percent of our overall business or
that no destination is more than 25 percent
of our overall business,” Robinson says.
“You never know when a natural disaster or
a regulatory change could have a significant
impact on our business.” �
California Cartage and its affiliated companies are one of the first to transition to a green fleet.
California Cartage and its affiliated companies e one of the first to trar
California Cartage and its affiliated companies ansition to a gre one of the first to tr
California Cartage and its affiliated companies een fleet.ansition to a gr
Clean Air, CleanTrucks, And The
Pride Of Ownership
� By MICHAEL GOUGIS
Contributing Writer
L ike a locomotive, a big rig starts its life
on the hard jobs, hauling the biggest
loads from one end of a huge continent (say,
one the size of North America) to the other.
At the end of its lifespan, when that rig (or
locomotive) isn’t really the sort of thing you
want to load to the gunwales and head off to-
ward the other coast, it still can provide use-
ful service as short-distance haulers.
This is a problem for the clean air move-
ment, since trucks like these can stay in
service for decades. And as they are essen-
tially castoffs from the major trucking
firms, they are cheap. This makes them at-
tractive to short-haul drivers and compa-
nies, like those that service the ports of
Los Angeles and Long Beach.
When the Clean Trucks Program started
in 2008, those older polluting trucks were
phased out of port service. But that left the
independent owner-operator between a
rock and a hard place, since new, clean
trucks ran into the six figures.
Several of the drayage companies that
serve the ports – Clean Fleet Systems, Total
Transportation Services, Inc., Progressive
Transportation Services – created a lease-
to-own program to help the drivers who
were operating old, polluting, $5,000 rigs to
purchase new clean trucks.
And the drayage companies say that the
lease-to-own programs have put modern
equipment into the hands of drivers who
could otherwise have not afforded to stay in
the business.
“Most of the people who choose to be in-
dependent owner-operators at the start of
the Clean Trucks Program could not qualify
financially and therefore drayage compa-
nies had to step up and finance these
trucks,” says Gary Mooney, chief executive
officer of Green Fleet Systems.
“All of the independent owner-operators
who started the program (coincidental with
the Ports’ Clean Truck Program) at the end
of 2008 or the beginning of 2009 have
completed their lease term and have either
purchased their truck outright or exercised
their option for Green Fleet to finance the
buyout of their truck over two years at a
nominal interest rate.
“Each of these independent owner-opera-
tors is listed as the registered owner of their
truck. Our lease program was very attractive
for the independent owner-operators as both
the monthly lease rate and buyout option on
the trucks were extremely competitive, com-
pared to the industry in general.”
Similarly, the other drayage companies
have reported turning over the keys to
dozens of independent owner-operators
who now own their own trucks. Some
owners, the companies have said, have
used the lease-to-own programs to pur-
chase several vehicles.
“I believe the program has worked well for
the independent owner-operators who have
chosen to be business owners,” Mooney
says. “Each one of the original group still
contracted with Green Fleet has created an
equity stake in their truck as the current ap-
praised values far exceed the buyout cost.” �
Long Beach Business Journal Page 15
1_INT'LTRADE_2014_Layout 1 4/26/14 7:24 PM Page 15
2014 Focus On International Trade2014 Focus On International Trade
World TradeWeek Events
CalendarMay 2014
Calendar Information Provided by the
Los Angeles Area Chamber Of Commerce
www.lachamber.com
May 1
88th Annual World Trade Week
Kickoff Breakfast
7:15-10:30 a.m.
JW Marriott at L.A. LIVE
900 W. Olympic Blvd., Los Angeles
www.worldtradeweek.com
International Dual Career Network –
Ernst & Young LLP
8 a.m.-Noon
Ernst & Young LLP
725 S. Figueroa, Suite 500, Los Angeles
http://events.lachamber.com/default.asp?d
etails=true&cale_id=5225
May 2-4
Global Ties U.S. Discover
Diplomacy Weekend
May 2: Noon-7 p.m.
May 3: 10 a.m.-7:30 p.m.
May 4: 10:30 a.m.-noon
DISCOVER DIPLOMACY
Washington, District of Columbia
May 3
2014 Fulbright Film Festival
10 a.m.-5 p.m.
James Bridges Theater
UCLA School of Theater Film & Television
235 Charles E. Young Dr., Los Angeles
May 5
Panel Discussion: Trade Opportunities
with the Pacific Alliance
10 a.m.-Noon
Los Angeles City Hall, Tom Bradley Tower
200 N. Spring St., Los Angeles
May 6
International Economic Summit
8 a.m.-3 p.m.
Port of Los Angeles
Cruise Terminal at Berth 93
San Pedro, CA 90731
May 7
Go Global: Achieving Your Goals
Presented by the
Port of Long Beach and UPS
8 a.m.-Noon
Grammy Museum
800 W. Olympic Blvd. #245, Los Angeles
Lebanese Cultural Reception
6 p.m.
House of Lebanon Cultural Center
4800 Wilshire Blvd., Los Angeles
May 8
Getting Global
9-11:30 a.m.
Diamond Bar Center
http://www.ci.diamond-bar.ca.us
1600 Grand Ave., Diamond Bar
May 8
AIR Cargo Day 2014:
2nd Annual Trade Show & Conference
10 a.m.-2 p.m.
The Proud Bird Restaurant, Ballroom
11022 Aviation Blvd., Los Angeles
2014 World Trade Week Luncheon
Meeting: How Mexico's Tax Reform
May Affect Your Business
11 a.m.-2 p.m.
Crowne Plaza Hotel, Los Angeles Harbor
601 S. Palos Verdes, San Pedro
Karoush at [email protected]
May 13
ExporTech-Session 2
7:30 a.m.-5 p.m.
Holiday Inn Torrance
19800 S. Vermont Ave.,Torrance
Automated Export System (AES)
Compliance Seminar
8 a.m.-5 p.m.
Embassy Suites LAX South
1440 E. Imperial Ave., Los Angeles
May 14
Automated Export System (AES)
PcLink Workshop
8-11:30 am
Embassy Suites LAX South
1440 E. Imperial Ave., Los Angeles
May 15
World Trade Conference 2014
8 a.m. to 5 p.m.
Radisson Hotel
2200 E. Holt Ave., Ontario
http://media.wix.com/ugd/afcde2_53c3551
041a34e37ab7356be130aad80.pdf
88th Annual World Trade Week
11 a.m.- 5 p.m.
Hilton Long Beach
701 W. Ocean Blvd., Long Beach
http://foreigntradeassociation.com/
upcomingevents
May 21
Go Global: Achieving Your Goals
Presented by the
Port of Long Beach and UPS
8 a.m.-Noon
Ontario Convention Center
2000 E. Convention Center Way, Ontario
Joel Perler: [email protected]
XXIII La Jolla 2014 Energy Conference
2:30-6 p.m.
Hilton La Jolla Torrey Pines
http://www.hiltonlajollatorreypines.com
10950 N. Torrey Pines Rd., La Jolla
858/453-5560
May 29
FREE Workshop: “Expanding your
Business Through Exports”
8:30-10:30 a.m.
Rancho Santiago
Community College District
www.ranchosantiagocitd.org
2323 N. Broadway, 1st Floor, Santa Ana
714/564-5414
World Trade Week HistoryThe World Trade Week concept was conceived in
1926 and first observed in Southern California in
1927. World Trade Week was founded by Stanley
T. Olafson, then manager of the World Trade De-
partment of the Los Angeles Area Chamber of Com-
merce. This occured during a time of isolationism
and under the conditions prevailing during the hey-
day of the restrictive Smoot-Hawley Tarriff Act.
By 1935, President Franklin Delano Roosevelt
had officially proclaimed World Trade Week a na-
tional observance by the U.S. Government. Initially
created to promote the ports of Los Angeles and
Long Beach, World Trade Week expanded its scope
following World War II to include all facilities and or-
ganizations in the Southern California area involvled
in world trade.
Today, World Trade Week actively promotes the
positive aspects of international trade that are vital
to a strong local and national economy, under the
guidance of founding sponsors the Los Angeles
Area Chamber of Commerce, Los Angeles World
Airports, the Port of Long Beach and the Port of Los
Angeles.– Los Angeles Area Chamber of Commerce
www.worldtradeweek.com
Cordero To Receive Stanley T. Olafson Award – The
Los Angeles Chamber of Commerce
is presenting the Stanley T. Olafson
Award to Mario Cordero, chairman of
the U.S. Federal Maritime Commis-
sion and a former chair of the Long
Beach Board of Harbor Commission-
ers. The award, established in 1933,
is presented “to an outstanding mem-
ber of the world trade community in
Southern California” and “recognizes those who have
contributed to the advancement of world trade and inter-
national relations above and beyond job requirements.”
Cordero is being honored May 2 at the 88th annual World
Trade Week Kickoff Breakfast.
Thank You AdvertisersThe following companies and public
sector entities made the 2014 Focus
On International Trade possible:
• California Cartage Company
• California State University, Long Beach
• Crowley
• FuturePorts
• Long Beach Container Terminal
• Moffatt & Nichol
• Pacific Crane Maintenance Company
• Pasha Stevedoring & Terminals
• Port of Long Beach
• Port of Los Angeles
• PortTech Los Angeles
• URS– Long Beach Business Journal
Photograph by the Business Journal’s Thomas McConville
2014 Focus On International Trade
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