- Experts assure that this stoppage in the main US ports will be evidenced by shortages, increased prices and million-dollar losses for companies.
The strike by workers at 36 ports on the East Coast and the Gulf of Mexico of the United States (USA), represented by the International Longshoremen’s Association (ILA), could delay purchase shipments online made from other countries.
Since October 1, the union that represents port workers in dozens of ports in the United States announced the paralysis of activities until they reach a salary and operational agreement with the employers’ companies organized in the US Maritime Alliance (USMX).
This strike affects more than 43% of US maritime trade and could cost more than 2 billion dollars a day by delaying trade in food, vehicles or hydrocarbons, which is already beginning to have consequences in the market.
The striking ports represent almost half of maritime cargo transportation in the United States.
Jorge Luis Quijano, former administrator of the Panama Canal, explained to the EFE news agency that the consequences will depend on how long the strike lasts and the number of containers on ships that cannot enter the affected ports, which will also increase freight costs.
“Everything is unbalanced again. When you don’t have a return ship with empty containers to take them to China, there will come a time when China runs out of containers. And that imbalance causes other delays and other cost overruns,” said Quijano.
How will shipping affect international purchases?
The port strike is a threat to American trade that could create a domino effect on exports to other countries.
Erin McLaughlin, senior economist at The Conference Board, told the outlet AARP This represents an even bigger problem since it coincides with the official start of Christmas shopping, a time when many consumers order products online.
The American media pointed out that more than half of sales may be affected, because the ports on the East Coast and the Gulf of Mexico handle 57% of the products that enter and leave the United States.
“If the strike extends neither imports nor exports will move, ships will begin to pile up outside ports, containers will remain and industries from retail to manufacturing and agriculture will be affected,” said Jonathan Gold. , vice president of Supply Chain Policy and Customs at the National Retail Federation, in a statement cited by the outlet AARP.
Additionally, Gold added that this strike would cause shipments to be delayed, manufacturers not to receive supplies, farmers not to be able to import products to foreign markets, among other losses for the US economic sector.
The East Coast of the United States and Asia, and the West Coast of South America are the main routes served by the Panama Canal, which connects the Atlantic with the Pacific and through which around 3% of world trade passes.
Other problems that the duration of the strike would trigger would also affect the number of ships that cross the Panama Canal.
The president of the Logistics Business Council (COEL) of Panama, Daniel Isaza, told EFE that with a prolonged strike the number of containers arriving at Panamanian ports will be reduced and that may cause a reduction in income.
However, for the president of the COEL, this situation opens a long-term opportunity for companies that use the East Coast of the United States as their distribution center for products, whether imported from Asia or Europe, to move to Panama.
Economic impact of the strike
The strike will have an impact on the US economy of more than 3 billion dollars a day, according to estimates by JP Morgan Chase. Specifically, the firm pointed out that the cessation of operations in all ports could cost between 3.8 and 5 billions of dollars daily.
This strike, the first involving ports on the US East Coast and the Gulf of Mexico since 1977, could also have adverse effects on supply chains and transportation routes.
US President Joe Biden took a position on October 2 in favor of port workers and urged employers to improve their working conditions.
“It is time for USMX to negotiate a fair contract with longshoremen that reflects the substantial contribution they have been making to our economic recovery,” he said, in a statement released by the White House.
The Port of New York and New Jersey supplies 46.3 million local consumers, according to its website, so shortages on the shelves of chain stores and retailers could begin to increase in the coming days.
“Dockworkers will play an essential role in helping communities get the resources they need. “Now is not the time for ocean carriers to refuse to negotiate a fair wage for these essential workers while making record profits,” Biden added.
If the strike continues, experts also point out that it will have effects on inflation, since it will raise the prices of food, cars and even toys, according to the media. CNBC.
Sectors that will be most affected by the strike in the US
According to experts consulted by EFE, the consumer goods, automotive, energy and agricultural products sectors could be the most affected if the strike continues.
The union and employers have exchanged counteroffers of proposals without obtaining results since the start of the strike.
“Both parties have moved from their initial positions and we are hopeful that we can restart collective bargaining on pending issues,” the employers’ association said in a statement.
The American Farm Bureau Federation indicated that the strike will have an almost immediate impact on supplies of perishable imports, particularly bananas.
The federation data, shared by the media TelemundoThey also pointed out seafood as another item that will be affected since these products pass through these ports daily.
“The distribution chain for soybeans, poultry, unrefined sugar and alcoholic beverages could also be affected,” he indicated. Telemundo.
“For retailers, East Coast and Gulf Coast ports are a fundamental part of our consumer electronics, footwear, food products, canned foods and other products,” said economist Johnathan Gold for the media. AARP.
Other non-perishable goods, such as furniture and appliances, are also transported through the affected ports.
However, the US Department of Transportation indicated in a statement on October 2 that the strike was announced months ago, so since then they have been in contact with carriers, shipping lines, ports, railways and other supply chain partners. which allowed them to prepare and look for ways to reduce distribution failures.
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2024-10-04 02:35:21
