USMX-ILA STRIKE UPDATE - Resuming Negotiations
The International Longshoremen’s Association (ILA) and the United States Maritime Alliance (USMX) are scheduled to resume negotiations for a new master contract on January 7, 2025.
With the current contract extension set to expire on January 15, the timing of the resumed talks leaves a narrow window to reach an agreement and avoid a potential second strike by the ILA, which could disrupt operations at ports along the US East and Gulf coasts.
Both the ILA and USMX declined to comment on the status of the negotiations, which impact 45,000 dockworkers.
Although the two parties have agreed on wage terms for a new master contract, negotiations have been stalled since mid-November over disagreements about port automation provisions.
The ILA has strongly opposed the introduction of automation technology at ports under its jurisdiction, specifically targeting semi-automated rail-mounted gantry cranes (RMGs) as a technology it seeks to prohibit under the new contract. In contrast, the USMX has argued that technologies like RMGs enhance port productivity and generate additional opportunities for longshore workers.
Progress in the negotiations has been further complicated by President-elect Donald Trump’s involvement, as he expressed support for the ILA’s opposition to automation.
Potential Impacts
Work Stoppages: A strike could severely affect key East Coast and Gulf Coast ports, including major hubs such as New York/New Jersey, Savannah, Charleston, Houston, Miami, and Port Everglades.
Scenarios and Implications
Short-Term Strike (1-2 days): While a brief strike would cause disruptions, historical patterns suggest that port congestion and delays would likely be cleared within 5-7 days. The impact on costs and logistics would generally be minor, unless carriers invoke force majeure, which could lead to rerouting containers to foreign ports.
Extended Strike (1-2 weeks): A longer strike would create significant congestion at ports and Container Freight Station (CFS) facilities. As operations at ports and CFS facilities reach capacity, transportation networks—particularly trucking and rail—would face considerable strain. These disruptions could result in higher costs and extended delays throughout the supply chain.
Mitigation Options
Alternative Routing: Leveraging our direct import and export services through Los Angeles and Montreal can help bypass disruptions on the East and Gulf Coasts. These routes offer an effective alternative to maintain supply chain continuity in the event of a strike.
While rerouting cargo may not be ideal under normal circumstances, these options offer practical solutions to minimize the impact of potential strikes. Decisions should consider factors such as transit times, costs, and specific shipping needs to ensure the most efficient path forward.
If you have specific shipments or need further assistance, it’s advisable to communicate with your logistics provider for tailored solutions and updates.
To discuss your cargo or solutions on particular lanes, please contact your South East World Wide (Chicago), Ltd. Sales Representative.