Xeneta joins US strike disruption warning

Thirty-six ports across the East and Gulf coasts are planning a walk-out if a new deal cannot be agreed with the International Longshoreman’s Association, which represents 85,000 port workers, before the 30 September deadline.

Previously Container xChange and FourKites have advised of delays and now ocean and air freight intelligence platform, Xeneta, is warning of the global consequences if the strikes go ahead.

“There are ships on the ocean right now carrying billions of dollars of cargo heading to ports on the US East and Gulf Coast,” said Peter Sand, chief analyst at Xeneta.

“These ships cannot turn back and they cannot realistically re-route to the US West Coast.

“The consequences will be severe, not only through congestion at US ports, but importantly these ships will be delayed returning to the Far East for the next voyage. A strike lasting just one week will impact schedules for ships leaving the Far East on voyages to the US in late December and throughout January.”

Average spot freight rates on the trade from the Far East to US East Coast spiked more than 300% between 1 December 2023 and early July this year, says Xeneta.

“More than 40% of total containerised goods enter the US through ports on the East Coast and Gulf Coast, so the stakes could not be higher,” continued Sand.

Read more: Container xChange warns of severe disruption if US port strikes go ahead

Read more: FourKites warns political intervention may be needed to halt disruptive US port strikes

Sand says the government may need to step in to bring the matter to a resolution, among growing pressure from trade associations to resume negotiations.

“Government intervention should be seen as a strength in the system, because it will prevent a dispute between a smaller group of interests – whether that is dockworkers or port terminal owners – from significantly impacting the wealth of the entire nation,” he said.

“If the parties cannot solve the dispute themselves then someone needs to solve it for them because closing the US East and Gulf coasts to trade for a prolonged period of time would be toxic for supply chains and the economy.”