Key industry and government officials are urging US dockworkers and their employers to avoid a strike at East and Gulf coast ports this week, though many facilities are already bracing for a shutdown.
“We are coordinating with partners across the supply chain to prepare for any potential impacts,” said Steve Burns, a spokesperson for the Port Authority of New York and New Jersey, the nation’s busiest Atlantic gateway for containers. “We urge both sides to find common ground and keep the cargo flowing for the good of the national economy.”
The United States Maritime Alliance, a group representing ocean carriers and port terminal operators, and the International Longshoremen’s Association have no talks planned before their contract expires at the end of Monday (Sep 30).
The stalemate sets the stage for a strike to start the following day, forcing ports with the combined capacity to handle as much as half of all US trade volumes to halt container cargo and auto shipments. Energy supplies and bulk cargo like municipal waste and road salt will not be affected, and some exceptions will be made to allow for the movement of military goods and cruise ships.
Speaking on condition of anonymity, a White House official said the administration will also be watching freight rates and surcharges imposed by ocean carriers, and does not want to see anti-competitive price moves. The two largest container lines have already announced plans to impose extra fees tied to work stoppages.
If a strike goes ahead, it would be the first major labour disruption at US maritime hubs since a nine-month stand-off in 2014 to 2015 led to work slowdowns and reduced productivity at ports on the West Coast.
Oxford Economics estimated that a strike would cost the US economy US$4.5 billion to US$7.5 billion a week – a hit to gross domestic product that would be reversed after it was over and shipments resume.
Analysts said even a short strike would be costly for many retailers, manufacturers and other importers heading into the fourth quarter. Every week that cargo is stalled and backlogs are created will take a month to clear, in part because ports like Los Angeles and Long Beach, California, are already operating near capacity.
According to Oxford Economics, East and Gulf coast ports are major players in handling exports and imports of raw materials including copper, cotton, tin and wood, as well as base metals used in manufacturing. BLOOMBERG
