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How US Importers Can Weather the Looming East and Gulf Coast Port Strikes

US East Coast Ports
US East Coast Ports

US importers are bracing for significant disruptions as potential labor strikes loom at East and Gulf Coast ports. This concern stems from the recent breakdown in labor contract negotiations between the International Longshoremen’s Association (ILA) and the United States Maritime Alliance (USMX).


The primary point of contention in the halted negotiations is the use of automated technology to process trucks at port terminals. The ILA claims that this automation, employed by APM Terminals and Maersk Line, violates their agreement with USMX. The Auto Gate system, which autonomously processes trucks without ILA labor, was first identified at the Port of Mobile, Alabama, and is reportedly being used at other ports as well.


Due to these concerns, the ILA has suspended talks with USMX and has stated that they will not resume negotiations until the Auto Gate issue is resolved. This suspension has heightened fears of a potential strike once the current six-year labor agreement expires on September 30, affecting 45,000 port workers.


The Vicious Cycle of Disruption


Peter Sand, Chief Analyst at Xeneta, highlights the ripple effect already being felt: “Shippers have already been frontloading imports ahead of the traditional Q3 peak season due to supply chain concerns from the Red Sea conflict. With the added risk of disruptions at East and Gulf Coast ports, they may accelerate these efforts, further complicating the situation.”


This increased frontloading has led to severe port congestion in Asia and Europe, pushing ocean freight container shipping spot rates up by over $2,000 per FEU. According to Sand, “Shippers are stuck in a vicious circle where their efforts to safeguard supply chains could exacerbate the problem.”


Alternative Solutions and Strategies


Historically, strike action at US ports has resulted in a spike in airfreight demand as firms look to avoid disruption to shipping services. However, in the current scenario, there are alternative strategies to mitigate the impact:


Redirecting Imports to the West Coast: Shippers might consider redirecting imports to the US West Coast, reversing a trend seen during the COVID-19 pandemic. This shift could relieve some pressure from airfreight and distribute the load more evenly across the country's port infrastructure.

 

Using Intermodal Transport: Firms can also opt for intermodal transport to reach planned destinations. This approach allows goods to be shipped to the West Coast and then transported by rail or truck to their final destinations, potentially easing congestion at affected ports.

 

The current climate of fierce rhetoric from the ILA unfortunately makes a negotiated settlement seem less likely. However, all parties involved must recognize the potential consequences of inaction. The smooth flow of goods through US ports is critical for the nation's economy, and a prolonged strike would have a ripple effect across countless industries.

 

Inland Star’s Commitment to Partnership, Stewardship, and Ownership


At Inland Star, we understand the complexities and challenges faced by importers during such turbulent times. Our commitment to tailored supply chain solutions ensures that we dive deep into understanding your unique challenges, crafting solutions that drive efficiency, reduce costs, and propel your business forward.


Our Carson, CA facility is strategically positioned to support your logistics needs, especially in times of potential disruption.


  • Tailored Solutions: Customized logistics strategies addressing your specific needs.

  • Safety & Compliance: Operations designed to meet the highest safety and compliance standards.

  • Brand Protection & More: Every product and order is treated with the utmost care.


📍 Located less than 8 miles from the Port of Long Beach with easy access to all major highways. Whether you need short-term, long-term, or cross-dock warehouse solutions, let’s start a conversation.


Do It Right® with Inland Star. Protect your supply chain with warehouse support from Inland Star in LA. Do you have a Plan B?


Request a quote today to explore how Inland Star can help you weather the storm and ensure your logistics operations run smoothly.

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