Update: 10: 15 01 October, 2024 (CET) – US dockworkers confirm strike
In a statement released on Monday, (September 30, 2024), the ILA criticised the USMX, accusing ocean carriers of prioritising billion-dollar profits while offering an unacceptable wage package to dockworkers.
“The Ocean Carriers represented by USMX want to enjoy rich billion-dollar profits that they are making in 2024, while they offer ILA Longshore Workers an unacceptable wage package that we reject,” the ILA said in its announcement. “ILA longshore workers deserve to be compensated for the important work they do keeping American commerce moving and growing.”
The ILA also expressed concern over the rising costs of shipping, accusing shipping companies of “gouging” customers and inflating container prices.
“They are now charging $30,000 for a full container, a whopping increase from $6,000 per container just a few weeks ago,” the union noted.
Ports affected by the strike
The strike will affect all major ports between Maine and Texas, including:
- Port of New York and New Jersey – The third busiest port in the United States, critical for consumer goods and manufacturing parts.
- Port of Delaware – Known for handling large quantities of consumer goods, including bananas.
- Ports of Savannah and Charleston – Key entry points for imported apparel, footwear, and accessories.
- Port of Houston – Major hub for industrial goods and machinery.
- Port of Jacksonville – A key location for automotive imports and exports.
The strike affects approximately half of all container goods shipped to the U.S.
Original article, 30 September 2024
The International Longshoremen’s Association (ILA), representing around 25,000 dockworkers, plans to walk off the job unless port operators agree to wage increases and limits on automation. These ports handle nearly half of US container imports, including essential goods such as food, pharmaceuticals, electronics, and clothing.
According to The Financial Times, analysts from JPMorgan estimate that the strike could cost the US economy as much as $5 billion per day. US retailers, automakers, and other businesses are preparing for the disruption by pulling forward shipments and increasing inventories. However, this has pushed up freight costs by as much as 20% due to the need for extra warehousing space and logistical adjustments.
Data from shipping analysts Xeneta, cited by the paper, shows that the cost of shipping a 40ft container from northern Europe to the US east coast has risen 29% since the end of August.
Douglas Kent of the Association for Supply Chain Management told The Financial Times that US infrastructure is not equipped to shift such a large volume of goods to the west coast, leading to further potential delays. Additionally, global supply chains could face further strain if the strike goes ahead, as the availability of vessels may become limited, ultimately driving up shipping costs worldwide.
If the strike continues for more than a week, businesses fear empty shelves and rising prices similar to the disruptions seen during the Covid-19 pandemic, according to The Financial Times.
While large companies have started to reroute shipments and stockpile goods, smaller businesses are more vulnerable to delays. Chris Butler, CEO of holiday decor retailer National Tree Company, told The Financial Times that 15% of his company’s goods could be stranded if ports close.
Global shipping companies such as AP Møller-Maersk and Hapag-Lloyd have already announced surcharges to cover higher operational costs during any potential disruption. The Financial Times reports that Maersk plans to charge an additional $1,500 per 20ft container if the strike occurs.