Concerns Over Potential Strike Affecting U.S. Ports

By Lisa Baertlein, Doyinsola Oladipo, and Jessica DiNapoli

(Reuters) – U.S. shippers are avoiding East and Gulf Coast ports due to fears of a strike by 45,000 dockworkers if union leaders fail to secure a new contract by January 15.

The International Longshoremen's Association (ILA) and United States Maritime Alliance (USMX) recently ended a three-day strike with a tentative wage agreement but left automation issues unresolved.

Chris Peterson, CEO of Newell Brands, noted that they are rerouting critical shipments to the West Coast in anticipation of potential strikes. The October agreement provided a 62% wage increase over six years but did not address automation concerns that threaten job stability.

Union leader Harold Daggett is advocating against automation projects, while employers argue for their necessity to maintain competitiveness.

Despite plans to return to negotiations next month, many shippers remain skeptical, echoing concerns from industry leaders about the ease of reaching a new agreement.

Salvatore Stile, a freight forwarder, estimates a 60-70% chance of a second strike, highlighting automation as the central issue in negotiations.

Newell’s recent strategy involves rerouting shipments from Asia to West Coast ports instead of East Coast facilities.

Port of Los Angeles Executive Director Gene Seroka noted a lack of momentum for shifting back to the East Coast, as record volumes were noted earlier this summer.

As strike-afflicted ports continue to clear backlog, 31 container ships still await docking, down from 54 post-strike.

Matthew Shay, CEO of the National Retail Federation, mentioned that retailers preemptively imported goods to mitigate disruptions, underscoring the strikes’ wider economic impact.

Shay expressed concern about ongoing problems affecting communities nationwide.