At US East Coast ports, the accumulation of trucks has been noticeable, and shipping companies are implementing alternative strategies due to the impending strike by dockworkers, which is a week away. Shipping lines have advised their clients to retrieve their goods from these ports by September 30, as negotiations between employers and unions over a new six-year labor contract have made little progress. Analysts estimate the daily cost of a strike could surpass $1 billion. During a meeting at an East Coast port, a senior port official observed an unusually large queue of trucks collecting inbound containers, indicating preparations for a potential shutdown.
Shipping companies, including Ocean Network Express (ONE), Maersk, and Hapag-Lloyd, have issued advisories urging expedited documentation, customs clearance, and cargo retrieval. ONE has also decided to bypass port calls on five services to the US East Coast, suggesting cargo collection at alternative ports before October 1, 2024. The International Longshoremen's Association (ILA) and the United States Maritime Alliance (USMX) have not resumed official discussions, with USMX open to mediation via the Federal Mediation & Conciliation Service (FMCS).
The ILA seeks significant wage increases, citing the substantial profits made by shipping lines during the Covid-related supply chain disruptions, while the USMX references a 32% wage increase agreement with West Coast longshoremen as a benchmark. The ILA's demand to limit automation in cargo handling further complicates negotiations. In response to the strike threat, shipping lines are introducing surcharges and making plans for vessels arriving after the potential October 1 shutdown, aiming to minimize delays.
Economic implications of a strike are significant, with Oxford Economics highlighting a potential daily cost exceeding $1 billion and extended strikes disrupting supply chains into 2025. National Tree CEO Chris Butler expressed concerns over delayed shipments due to the strike, emphasizing the importance of a quick resolution. The upcoming US elections add to the complexity of the situation, with no clear indication of government intervention through the Taft Hartley Act.
Source: seatrade-maritime