The U.S. is barreling toward a strike at East and Gulf Coast ports, ahead of a looming October 1 deadline for the International Longshoremen’s Association (ILA) and the U.S. Maritime Alliance (USMX) to reach a new collective bargaining agreement.
Negotiations between the ILA and USMX stalled out in June, after the union discovered that an automated gate system was being used at a handful of ports. The ILA has refused to return to the bargaining table until the issue is resolved, leaving both parties in a holding pattern as the clock ticks on averting the union’s first large-scale strike since 1977.
Impacts from a potential strike would also be magnified by ongoing issues in the Red Sea and Panama Canal, says Mike DeAngelis, the senior director of international solutions for freight visibility platform FourKites.
“We’re facing a perfect storm — with the Red Sea disruptions preventing normal access to the Suez Canal and the Panama Canal’s still-reduced capacity, an ILA strike would effectively choke off major arteries of global trade,” DeAngelis says.
Missile and drone attacks on vessels by Houthi rebels have stalled shipping through the Red Sea for nearly a year, with the group having targeted at least 70 ships dating back to October of 2023. For the Panama Canal, although restrictions on vessel drafts were lifted in August, the fallout from months of drought conditions still has the crucial waterway operating below its normal capacity.
In the meantime, shippers have been preparing for a strike in a number of ways, with many having pulled scheduled shipments forward to get ahead of any potential shutdowns, while others have already started diverting vessels to West Coast ports. Even so, DeAngelis warns that “frontloading can only get you so far,” given the sheer volume of cargo that moves through East and Gulf Coast ports. According to data from the National Association of Manufacturers (NAM), those ports account for roughly 56% of the country’s containerized imports, as well as 68% of exports, spread across a wide swathe of industries.
The NAM estimates that one in every three containers carrying plastics and petroleum exported by the U.S. leave from the Port of Houston, while nearly 30% of pharmaceutical imports arrive through the Port of Charleston. The Port of Baltimore also handles the country’s largest share of imported cars and trucks, followed by Georgia’s Port of Brunswick and the Port of New York and New Jersey. And according to a 2023 report from the U.S. Department of Agriculture, the New Orleans Port Region accounts for the country’s largest slice of agricultural exports in metric tons (35%), while the Port of New York boasts the biggest share for agricultural imports (17%).
If those ports shut down for any significant amount of time, the U.S. could find itself buried under inventory shortages, higher costs at grocery stores, and months-long backlogs at shipping hubs. Supply chain data service Sea-Intelligence estimates that it would take five days to clear container backlogs at East and Gulf Coast ports in the event of a one-day strike. If a work stoppage drags on for a week, those backlogs wouldn’t be cleared until mid-November, while a two-week strike would push that timeline out even further, to early 2025.
The likelihood of a strike has increased with each passing day, too. In a September 23 release, the USMX said that it still hasn’t been able to schedule a meeting with the ILA to resume negotiations, adding that it “remains prepared to bargain at any time.”
“Both sides must come to the table if we are going to reach a deal, and there is no indication that the ILA is interested in negotiating at this time,” the USMX said.
For its part, the union has insisted that it “will be on the right side of history,” ILA executive vice president Dennis Daggett said on September 20.
“Strikes are never easy, but in today’s world, with labor laws stacked against us and corporate greed at an all-time high, it remains one of the most powerful tools we have in our fight for justice,” Daggett said.
Several ports have already started preparing for a possible shutdown as well. The Port of Houston published guidance on September 18, sharing that it plans to evaluate the need for additional gate hours in the days leading up to the October 1 strike deadline. The Georgia Ports Authority is similarly planning to extend gate hours on September 28 and 29.
