29 Sep ILA strike imminent and inevitably impactful
The International Longshoremen’s Association (ILA) has appointed vice presidents to the 13 committees that form a strike mobilisation plan underpinning the industrial action due to commence on the 1st of October across the East and Gulf coast ports if a new contract isn’t achieved by the end of the month.
The primary issues being negotiated are income, healthcare and the protection of union jobs against semi-automation and automation at marine terminals.
The potential for disruption due to the looming industrial action is significant. With such a strike spanning both the East and Gulf Coast – home to 5 of the 10 busiest ports in North America – the disruption would be far reaching, reverberating across most industries and much of the globe.
Shippers with freight across Europe, Oceania, and Asia bound for the U.S. will feel the impact and this would cascade across the flow of freight across the U.S., Canada and Mexico, culminating in longer transit times and additional costs due to factors such as possible congestion fees, detention and demurrage charges and more. This would subsequently impact retailers, consumers, inflation and the economy.
However, interestingly, with little time until the potential strike, there are no signs of any space constraints on the westbound trans-Atlantic routes. This potentially indicates that a substantial amount of cargo was shipped in advance, potentially in anticipation of the upcoming industrial action, over the past month or so, which was further reflected in the sharply rising spot rates over the same period.
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