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Shipping Interests Oppose Katrina-Related Jones Act Waiver

American shipping companies are ready to transport agricultural products in the U.S., and a request to use foreign shipping companies instead is "unprecedented and unnecessary," a coalition of American maritime industry representatives wrote to President Bush on September 22.

The letter responds to a request by a group of agricultural organizations who want to bypass U.S. shipping companies workers and use foreign shipping companies and foreign workers to transport of grain and other products in the U.S. Under the Jones Act, all cargo transported between two points in the domestic U.S. must move on U.S. flag vessels. Agricultural interests have argued that the devastation in the Gulf merits a waiver of the Jones Act.

"There is existing capacity on coastwise-qualified U.S. vessels, on both the rivers and the coasts, to handle the demand for the transportation of agricultural products," wrote Philip Grill, chairman of the Maritime Cabotage Task Force (MCTF). "The agricultural interests' request is not based on any legitimate justification."

Grill said there are "thousands of barges on the Mississippi River system now poised to move America's grain harvest to market" and "oceangoing vessels that are capable of providing service to agricultural interests, including transporting Midwest feed supplies to markets in the U.S. mid-Atlantic and Southeast regions."

On September 20, a group of 21 agricultural interests asked the president to waive the Jones Act for agricultural products to "ease the burden of the overtaxed U.S. transportation system" in light of the catastrophic effects of Hurricane Katrina.

Grill emphasized that the surplus of grain in the Midwest cited by agricultural interests is not the result of a lack of qualified American vessels to transport it.

"As the spokesperson for the American Farm Bureau Federation admits, much of the surplus problem is due to last year's crop still being in storage in the region," he said. "That situation is driven by the economic state of the world export market for U.S. grain, not the inability to move grain within the U.S," he concluded.

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