Hello Customers, Colleagues, and Friends…
We are writing to inform you of the pending US Port Strike that will affect US East Coast and Gulf Coast ports in a major way.
The significance of this potential strike cannot be overstated. The looming threat of a dockworker’s strike at U.S. East Coast and Gulf Coast ports, involving 45,000 workers, could bring a significant portion of the U.S. supply chain to a standstill. These ports handle about half of all U.S. imports, meaning that a strike would disrupt billions of dollars’ worth of goods, including critical shipments of electronics, industrial materials, and holiday merchandise. Major ports like New York-New Jersey, Savannah, and Houston would be directly affected, crippling vital trade routes and causing widespread delays across the nation.
Experts warn that even a one-day strike could take up to a week to clear backlogs, while a two-week disruption could impact port operations well into 2025. Retailers and manufacturers are bracing for severe economic fallout, as the strike would hit just weeks before the holiday shopping season and could cost billions in lost revenue and unfulfilled orders. The strain on West Coast ports, which are already experiencing congestion from diverted shipments, is adding to the urgency and further complicating domestic supply chains.
As for many of the potential strikes in this industry, we feel it is appropriate to prepare for the worst and hope for the best. Given the magnitude of the situation, it is our expectation, and the expectation of many in the industry, that if the parties involved cannot come to a resolution before Oct 1 that government intervention will proceed. Senate Health, Education, Labor, and Pensions (HELP) Committee Ranking Member Bill Cassidy (R-LA) sent a letter this morning to President Biden and Vice President Harris urging the administration to use its authority to avert a possible East-Gulf coast-wide port work stoppage on Oct. 1.
Under the Taft-Hartley Act, Cassidy noted the White House can establish a board of inquiry and seek a court injunction grant to allow both parties to continue negotiations. So far, the Biden-Harris administration has refused to use its authority under Taft-Hartley to resolve the labor dispute between the ILA and USXM.
Cassidy’s letter further explained that a one-day strike will hold up $5 billion worth of goods and could take up to five days to clean up the supply chain, while a two-week strike could take six months to correct the supply chain.
WHAT THIS MEANS FOR YOU
- Potential disruption to the US supply chain including ramifications to US West Coast port operations
- Prolonged Delays: Even a short strike could take days to resolve, while a longer disruption could paralyze ports into 2025, leading to backlogs and delays that ripple through supply chains.
- Rising Costs and Supply Chain Strain: Importers face increased costs and logistical challenges, as many shift cargo to already congested West Coast ports or delay shipments, risking inventory shortages and financial losses.
Please continue to plan accordingly for your import, export, and domestic transportation needs.
Sincerely, Your friends at Krenz and Hannan International
SOURCES
https://www.ncbfaa.org/news-advocacy/monday-morning-ebriefing
An East Coast Port Strike Could Shake the Economy – The New York Times (nytimes.com)