Potential US Seaport Strike Could Cause Major Disruption: Experts Warn of Significant Backlog

A potential strike at major US seaports along the East Coast and Gulf of Mexico could lead to significant delays and disruptions, with cargo being backed up for weeks or even months, according to industry experts. With the union contract for around 45,000 dockworkers set to expire on September 30, retailers like Walmart and other importers are racing to bring in goods ahead of a possible work stoppage, reports Reuters.

Analysts at Sea-Intelligence have warned that even a one-day strike could take up to four to six days to clear. Alan Murphy, CEO of Sea-Intelligence, stated, “A one-week strike in early October would not be cleared until mid-November.” He added that a two-week strike could potentially disrupt port operations until 2025.

The impact of such a strike would be far-reaching, affecting not only the supply chain but also the overall economy. AP Moller-Maersk has also issued a cautionary note, suggesting that a one-week shutdown could require up to six weeks of recovery time, with each day of the strike adding to significant backlogs and delays.

Importers have already begun to take preemptive action, albeit at a high cost. The spot market price for shipping a 40-foot container from the Far East to the US East Coast surged from around $2,100 in April 2023 to over $10,000 by early July 2024. Peter Sand, chief analyst at pricing platform Xeneta, emphasized, “The risk of port strikes was something that had to be managed by acting early.”

However, the window for early shipments is quickly closing as the September 30 deadline approaches. Further complicating matters are recent shipping diversions due to geopolitical tensions, which have extended transit times to East and Gulf Coast ports from Asian factories. Transit times have now increased from 30 days to over 45 days, causing additional concerns for importers.

For importers who haven’t yet shipped their goods, time is running out. “Shipping cargo next week may be too late, as it could just end up sitting on the water if widespread strikes occur,” Sand warned.

Businesses across the globe are now bracing for the potential fallout from the looming strike, with many hoping for a last-minute resolution to avoid what could be a massive disruption to the supply chain. At 20Cube Logistics, we continue to monitor the situation closely and are committed to providing our clients with timely updates and strategic solutions to navigate this challenging environment. Stay tuned for further developments.