Port Strike Begins Across East & Gulf Coasts

Dockworkers at 36 ports across the eastern US are on strike for the first time in nearly 50 years, which has halted work and could snarl supply chains and cause shortages and higher prices if it stretches on for more than a few weeks, Reuters reported.

Workers began walking picket lines earlier today in a strike over wages and the ports’ use of automation, though some progress was reported in negotiations over a new contract. The existing contract between the ports and about 45,000 members of the International Longshoremen’s Association expired at midnight. The union’s opening offer was for a 77% pay raise over the six-year life of the contract, with ILA President Harold Daggett saying it’s necessary to make up for inflation and years of small raises.

The strike blocks everything from food to chemical shipments across dozens of ports from Maine to Texas, in a disruption analysts warned will cost the economy billions of dollars a day, threaten jobs, and potentially stoke inflation.

Reuters added that Daggett said employers such as container ship operator Maersk and its APM Terminals North America have not offered appropriate pay increases or agreed to demands to stop port automation projects that threaten jobs.

Some ports are specialized to handle goods for a particular industry, though most can handle any type of goods. The ports affected by the shutdown include Baltimore, MD and Brunswick, GA, the top two busiest auto ports; Philadelphia, PA, which gives priority to fruits and vegetables; and New Orleans, which handles coffee, mainly from South America and Southeast Asia, various chemicals from Mexico and North Europe, and wood products such as plywood from Asia and South America.

Other major ports affected include Boston, MA; NY/NJ; Norfolk, VA; Wilmington, NC; Charleston, SC; Savannah, GA; Tampa, FL; Mobile, AL; and Houston, TX. This comes just after Hurricane Helene tore through the Carolinas, GA, and FL.

Food & Beverage Industry

Remember the impact COVID-19 had on the shipping industry in 2020? Many retailers still are not at capacity of what they once was before the pandemic hit the US.

Beginning in early 2020, the COVID-19 pandemic disrupted maritime shipping and air freight services, leading to canceled sailings and flights, port delays, and container shortages. The disruptions increased volatility in maritime and air freight rates across regions and caused significant delays in the delivery of US merchandise imports, according to the US International Trade Commission.

Chemical Industry

Chris Jahn, president and CEO of the American Chemistry Council, stated: “The chemical industry is one of the country’s largest shippers across all modes of transportation, including marine shipments through our nation’s ports. The ports impacted by the strike account for about 90% of the waterborne chemical shipments that move in and out of the US.

"Nearly all manufactured goods are touched by the business of chemistry, which means transporting chemicals is essential to keeping the economy running. The chemicals shipped through these ports are used by every segment of the economy, including chemistry needed to support healthcare, energy generation, agriculture, auto manufacturing, building and construction, household products, aerospace and defense, semiconductor chips and electronics, and more.

“Shutting down the ports along the East and Gulf Coasts will result in a major disruption of chemical imports and exports, which in turn will hurt the broader economy both here and abroad. We urge the White House to do everything possible to prevent this major shockwave from rippling through the American supply chain and hurting U.S. trade by working with both parties to resume contract negations.”   

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