A description of the economics of the ocean carrier business can be best left to the carriers themselves but we are acutely aware of the marginal economics of the industry. We in the public port business can also vouch for the fact that the ocean liner industry is extremely competitive, as is the port business itself. The changes that took place as a result of the Shipping Act of 1984 and the Ocean Shipping Reform Act have contributed to this competition. The right of independent action has allowed flexibility for shippers to negotiate with individual carriers and deprived conferences of the discipline necessary to control pricing. The use of service contracts between shippers and carriers has become more common as evidenced by the large number of filings of such contracts with the Federal Maritime Commission.
Shippers now have the advantage of negotiating confidential contracts.
All of these changes in the law have increased the competition within the ocean carrier industry and applied downward pressure on ocean carriers rates and profits. Public port authorities are the public agencies which make our nation s ocean borne commerce possible. The facilities that we finance and develop work to the benefit of the carriers that use them and the shippers who ship through them. Whether a shipper is in Ohio, Illinois, North Dakota or some other state, the port facilities in New York, Houston, Los Angeles , New Orleans or other ports benefit them by making the efficient handling of their cargo possible. Shippers are the ultimate beneficiaries of the investment of public funds made by public port agencies.