Ship lines swell at US ports as dockworker strike enters third day
Items 1 of 3 containers are stacked at the Portsmouth Marine Terminal (PMT), as port workers from the International Longshoremen's Association (ILA) participate in a strike in Portsmouth, Virginia, US, October 2, 2024. REUTERS/Jose Luis Gonzalez
NEW YORK, Oct 3 (Reuters) – Container ships lined up outside major U.S. ports on Thursday as the largest dockworker strike in nearly half a century entered its third day, preventing unloading and threatening shortages of everything from bananas to auto parts.
There was no timetable for talks between the International Longshoremen's Association and employers, but port owners, under pressure from the White House to strike a deal to raise their wages, signaled late Wednesday that they were open to new talks.
“The longer it goes on, the more we're going to start feeling the impact,” Transportation Secretary Pete Buttigieg said on MSNBC. “If you don't have these ports on the East Coast and the Gulf Coast operating, your supply chains can't function well.”
According to Everstream Analytics, at least 45 container ships that were unable to unload anchored outside strike-affected East Coast and Gulf Coast ports by Wednesday, up from just three after the strike began Sunday.
“Many seem to have decided to wait it out, perhaps hoping for an immediate resolution to the strike action, rather than making a proactive decision to move in the other direction,” Everstream's Jenna Santoro said in a video presentation seen by Reuters.
He said the backlog of vessels could double by the end of the week, and the resulting congestion could take weeks, if not months, to clear.
An alternative is to sail to West Coast ports on the other side of the country, perhaps using the Panama Canal, a journey of thousands of miles that will increase costs and add weeks to delivery times.
The ILA began a strike by 45,000 port workers from Maine to Texas on Tuesday, its first major work stoppage since 1977, after negotiations over a new six-year contract with the United States Maritime Alliance (USMX) employers' group broke down.
The ILA is seeking a big pay raise and a commitment to end port automation projects it fears will destroy jobs. The USMX offered a 50% pay increase, but the ILA said that was insufficient to address its concerns.
“Reaching an agreement will require negotiations,” USMX said late Wednesday.
“We cannot agree on the preconditions for a return to bargaining, but we are committed to bargaining in good faith to address the ILA's demands and USMX's concerns.”
“The president needs to take a more aggressive stance here,” Republican Senator Shelley Moore Capito told CNBC.
On Wednesday the National Retail Federation, along with 272 other trade associations, called on Biden's administration to use its federal authority to end the strike, saying the walkouts could have “devastating consequences.”
The strike affected 36 ports – including New York, Baltimore and Houston – that handle a range of containerized products.
Economists say the port closures will not initially raise consumer prices as companies have accelerated shipments for key products in recent months. However, a prolonged stoppage will eventually filter through, with food prices likely to react first, according to Morgan Stanley economists.
“After the first week, we can expect some impact on perishables such as bananas, other fruits, seafood and coffee, meaning less product is reaching consumers, potentially driving up prices,” said Tony Pelley, global practice director for safety and resilience. BSI Americas.
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Reporting by Doyinsola Oladipo; Additional reporting by David Shepardson in Washington; Written by Richard Valdmanis; Edited by Sonali Paul and Jonathan Otis
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