Jones Act shipping - more affordable and reliable delivery for Puerto Rico

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The following is excerpted from an article released by the Transportation Institute.

WASHINGTON - The Transportation Institute (TI) has released a comprehensive study by Ernst & Young (EY) evaluating the Jones Act and its implications on freight rates, container availability, port congestion, and carrier performance in the Caribbean Region relative to global averages. The study evaluated the timeframe between January 2019 and December 2021 and captured the heightened volatility of freight movement during the peak of the COVID-19 pandemic.

"Across multiple metrics, shippers overwhelmingly associated better carrier performance with Jones Act carriers than non-Jones Act ones," according to the study. It also concluded that "in addition to providing stability and security in the region, the Jones Act shipping industry continues to provide substantial economic benefits to Puerto Rico."

"Jones Act carriers are dedicated to Puerto Rico and help local businesses make goods more affordable and the supply chain more reliable compared to our global competitors," said Transportation Institute Chairman and President James L. Henry. "While the entire global supply chain was disrupted during the pandemic, our Jones Act carriers proved to be 27 times more affordable and 8 times more reliable than non-Jones Act carriers."

Key Findings:

  • Global shipping rates increased 27 times more than rates in the Caribbean Region
  • Global shipping vessel delays were 8 times more than in the Caribbean Region
  • Jones Act Economic Impact on Puerto Rico: more than 2,000 jobs, $96 million in wages, $221 million in economic output

About the Study:

EY engaged in primary data collection through a survey of 49 companies that ship to and from the continental United States and the Caribbean. The survey gathered information from shippers on advantages or impediments that they experienced while shipping via Jones Act and non-Jones Act carriers with respect to freight and shipping cost, the availability of containers, and the resiliency and adaptability in carrier customer service models to meet the COVID-19 pandemic and supply chain challenges. The study also evaluated the economic contribution of the Jones Act shipping industry in Puerto Rico based on direct, indirect and induced contributions.

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