ICYMI: President Biden Announces New Push to Drive Down Shipping Costs and Tackle Inflation

President Biden announced today a renewed push to drive down shipping costs by urging Congress to pass the Ocean Shipping Reform Act of 2022, which the House and Senate have each passed in different forms. Championed by Senator Amy Klobuchar (D-MN) and Rep. John Garamendi (D-CA-3), the Act will empower the Federal Maritime Commission to crack down on excessive fees charged by carriers and ensure our farmers and ranchers are treated fairly. President Biden spoke with the CEOs of retail stores Jo-Ann Stores and Tractor Supply Co., as well as the President of the American Farm Bureau, about the pressing need to pass this legislation.

Tackling inflation is the President's top priority. Cracking down on ocean shippers will help cut costs for families. With some shipping companies raising their prices by as much as 1,000% during the pandemic, these costs are being passed on to consumers and small businesses, which has already driven up costs and could further drive up consumer prices by a full percentage point over the coming year.

Read more below:

Associated Press: Biden pushing to lower ocean shipping costs, fight inflation
[Josh Boak, 6/9/22]

WASHINGTON (AP) — President Joe Biden launched a renewed push Thursday to reduce the costs of shipping goods across oceans, a major challenge for retailers that the White House said has pushed up prices as the world emerges from the coronavirus pandemic.

The White House released a video featuring Biden talking with retail CEOs and calling on the House to pass the Ocean Shipping Reform Act of 2022, which the Senate passed at the end of March.

The measure would empower the Federal Maritime Commission to investigate late fees charged by carriers and prohibit ocean carriers and marine terminals from refusing to fill available cargo space. Biden's broader message is that a concentration of corporate power has contributed to higher shipping costs in ways that hurt businesses and fuel inflation.

The video features Biden sitting in the Oval Office, talking by speaker phone with the heads of Tractor Supply, Jo-Ann Stores and the American Farm Bureau Federation.

"There's only nine shipping companies, nine, N-I-N-E, major ocean line shipping companies who ship from Asia to the United States," Biden said. "These companies have raised their prices by as much as 1,000%."

Jo-Ann Stores, a fabric and craft retailer operating in 49 states, have seen a $100 million increase in shipping costs.

"We're not a huge company, but that $100 million increase that they passed onto us is, you know, more than our entire profit," Jo-Ann Stores CEO Wade Miquelon told the president in the video.

The White House said that shipping cost increases will likely add a full percentage point to the increase in consumer prices over the next year, according to research by the Kansas City Federal Reserve and the European Central Bank.

Over the past decade, the nine largest ocean carriers have increased their control of the market. They now account for 80% of global container shipping by volume and control 95% of the critical East-West trade lines, the White House said.

Improving supply chains has been a major focus of the Biden administration for the past year, even as other factors — such as food and energy — are now driving inflation. The U.S. government will release on Friday its May consumer price index, which is expected to show inflation of 8.2%. That would be close to a 40-year high set earlier this year.

Biden on Friday will speak at the Port of Los Angeles, which moved last year to round-the-clock operations in order to reduce shipping bottlenecks and relieve inflationary pressures.