Toy Association Engages Lawmakers to Take Action on Shipping Crisis

shippingAugust 31, 2021 | The Toy Association continues to take action to educate policymakers about the critical impact the global shipping crisis is having on its members. Most recently it joined a coalition of trade associations in submitting a letter of support for the newly introduced Ocean Shipping Reform Act of 2021, which addresses many of the long-term systemic supply chain and port issues.

“This new piece of legislation will provide the Federal Maritime Commission (FMC) with new tools that can help them define and address many issues in ocean shipping facing our members,” said Steve Pasierb, president & CEO of The Toy Association. “Unfortunately, pandemic-related port disruptions in Asia and the U.S. persist, while it is anticipated the global supply chain across all consumer products will continue to be severely stressed well into the second quarter of 2022. Shipping, supply chain, materials and labor are among a range of persistent issues negatively impacting the toy and play community all of which have been heightened by the ongoing COVID-19 pandemic.”

Currently, Toy Association members are reporting shipping price increases ranging anywhere from 500 to 800 percent, increasing costs for cargo and trucking due to detention and demurrage, and drastic increases in transit times of 75 days or more – all of which are only expected to worsen. Made in America toy manufacturers are also impacted by hiring hurdles and raw material prices, the most significant of which is resin pricing, which has increased more than 10 times the current annualized inflation rate, according to John Gessert, president of American Plastic Toys, a Toy Association member.

“Plastic prices have more than doubled over 12 months,” said Gessert. “The chemical companies cite margin expansion, elevated oil prices, demand, extreme weather in the gulf coast region, etc. None of these factors justify the huge price increases including the price of oil (which is currently trading 12 percent below the 52-week high and 2.5 percent over the last month). Imagine telling a toy buyer that a price increase is for ‘margin expansion.’”

With 95 percent of Toy Association membership made up of small- and mid-size businesses, The Toy Association recognizes that these challenges are impacting the vast majority of its members. As such, the Association remains proactive in its advocacy efforts, urging intervention by the U.S. government and lobbying the FMC to implement solutions, and maintains active communications with key ports and fellow toy associations around the world.

On September 30, The Toy Association will hold a webinar with Los Angeles Port Executive Director Gene Seroka to provide members with another update on the port and a forecast of the coming months into the holiday season. The webinar marks the latest in a series of informative members-only sessions with the Toy Industry Shippers Association (TOYSA), the Port of Los Angeles, and the FMC.

For the latest updates on this ongoing crisis, members are encouraged to visit the new Shipping Crisis Resource Center.

Additional questions on this topic may be directed to Ed Desmond, executive vice president of external affairs at The Toy Association.