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Hawaii Consumers Could Be Stranded

Shutdowns: The state imports about 80% of the goods its residents need. Many already have stocked up on essential items.

October 01, 2002|KAREN ROBINSON-JACOBS and SUSAN ESSOYAN | SPECIAL TO THE TIMES

A protracted work stoppage at West Coast ports could lead to trouble in paradise--or at least to a shortage of toilet paper.

Life in Hawaii has not been dramatically altered by the closure of West Coast ports. But a prolonged shutdown could affect the economy of the island chain, which imports about 80% of the goods its residents consume, most of which come via container ships across the Pacific.

"Almost all of our domestic cargo arrives via the West Coast ports," said Warren Sugimoto, administrative services officer with Hawaii's harbors division. "If the [work stoppage] lasts awhile, it will have a major impact. If it's very short term, the impact would be negligible."

Hawaii imports about $10 billion of products by ship every year, the vast majority from the mainland United States, said state economist Imada Iboshi. The list of goods includes such essential commodities as food, clothing, automobiles and fuel. The state also is dependant on the shipping industry to export its agricultural products, namely pineapple and sugar.

The slowdown in shipping comes at a delicate time for the nation's 50th state, which is still regrouping after being hit hard by the drop in tourism after last year's Sept. 11 terrorist attacks.

"Hawaii's economy is fragile now," said Leroy Laney, professor of economics at Hawaii Pacific University in Honolulu. "It's emerged from the recession that went into effect after 9/11 last year, but Japanese tourism has come back very slowly. We're certainly not in a boom period."

The flip side, others said, is that Hawaiians are accustomed to living life an ocean removed from the mainland United States and already had begun stocking up on nonperishable consumer goods. A number of merchants and some consumers said they had not begun to feel the effects of the dispute between shipping lines and the dockworkers Monday.

Several weeks ago, when the threat of a dock strike first loomed, consumers said they began stocking up on certain items.

Honolulu resident Wallace Zoller, strolling through Booth District Park in central Honolulu with his granddaughter Monday, said he wasn't concerned about shortages. "I feel comfortable that everything's going to be OK.

"In any case," he added with a grin, "I do have a stock of toilet paper and rice right now."

Shipping line Matson Navigation Co., which carries the majority of Hawaii-bound goods from the West Coast, said islanders began increasing shipments of nonperishable goods--everything from construction material to bathroom tissue--after the International Longshore and Warehouse Union entered contract talks with West Coast shipping lines and terminal operators last summer.

"Prior to July 1, [shipping] customers began building up their inventories," said Matson spokesman Jeff Hull.

In a typical week in early fall, he said, four Matson ships would leave various West Coast ports for Hawaii, loaded with about 3,000 containers total, translating into $8 million in revenue for the shipping line. He wouldn't say how much the loads have increased in recent months but said that "a protracted shutdown will be costly" to Matson's parent firm, Alexander & Baldwin Inc.

Meanwhile, with paper products in good supply, the Outrigger Hotels & Resorts in Honolulu was working with suppliers to create a cushion of perishable goods for its restaurant.

"We use a lot of local produce ... but from a meat and poultry point of view, we're probably 80% reliant on the mainland," said Barry Wallace, senior vice president of operations for Outrigger. "We can fly things in, but that raises the cost and limits the quantity, and it would complicate life considerably."

While many merchants were concerned about getting supplies in, others were worried about the inability to ship cargo out.

"It would be devastating for us if this goes on for a while," said Rose Saxby, owner of Puna Certified Nursery Inc., a major foliage grower on the Big Island.

"We have 10 containers of houseplants waiting to go out from Hilo Harbor [on the Big Island], and we may have to unpack them," she said.

*

Karen Robinson-Jacobs reported from Los Angeles and Susan Essoyan from Honolulu.

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