Thousands of dockworkers in the United States are continuing their strike, which began on Tuesday, blocking the country’s major ports.
The American president, Joe Biden, stated that this demonstration could be a “man-made disaster.”
As a result, exports of products like Chilean wine, salmon, and fruits are in jeopardy.
For instance, Miguel Canala-Echeverría, the general manager of Chile Fruits, reported that more than 580 containers of fresh Chilean fruits have been affected, with some left in Panama, “resulting in the ship being delayed with associated costs and a disruption of delivery schedules to distributors in the US.”
The president of SalmonChile, Arturo Clement, noted that “these income and logistical issues pose significant complications for exports.”
Furthermore, Angélica Valenzuela, the commercial director of Wines of Chile, confirmed that several wineries are redirecting their shipments to western ports, although this is not a viable long-term solution. She added that 280,000 boxes of wine (not in bulk) are at risk this October, equivalent to 150 containers.
The Government, through the Undersecretary of International Economic Relations (SUBREI), has reported that it is coordinating with Chile’s commercial and agricultural attachés in the United States.
“Although this is a private matter, our teams in that country have been in contact with local authorities and port operators to gather information about the conflict’s evolution and its potential impact on Chilean shipments, in an effort to address the situation within our powers and responsibilities,” he explained.
The United States is a key partner for agri-food shipments, hence, SUBREI has committed to closely monitoring the conflict’s progression.
The strike
The protest began early last Tuesday due to a lack of agreement between the International Longshoremen’s Association (ILA) and the USMX (US Maritime Alliance) shipping union, which are demanding a pay raise and an agreement to halt the automation of their jobs, which threatens their employment.
“We are demanding a $5 per hour raise for each of the six years of the new ILA-USMX contract. Additionally, “We want a completely airtight agreement prohibiting any automation or semi-automation.” said ILA president Harold Daggett, according to a union statement.
In the last 24 hours, USMX and ILA have exchanged counteroffers, with USMX proposing a 50% salary increase and requesting an extension of the current contract.
“Both parties have moved away from their initial positions, and we are optimistic that we can restart collective bargaining on outstanding issues,” the shipping companies’ association stated.
Consequences of the dockworkers’ strike in the US
The strike, which has already involved 45,000 dockworkers, could cost over $2 billion a day since it impacts strategic port terminals through which 43% to 49% of the country’s maritime trade flows, including Elizabeth/Newark, Houston, Miami, and Baltimore, where today hundreds of workers blocked the entrances to the terminals in protest.
Baltimore is the second-largest coal exporter in the United States. According to the Energy Information Administration (EIA), it is particularly noted for the traffic of motor vehicles.
Biden: “The last thing we need is a man-made disaster”
Biden has urged that they “sit at the table and end this strike”: “The last thing we need is a man-made disaster,” he stated to the press before boarding Air Force One, comparing it to the “natural disaster” caused by Hurricane Helene.
“Basically, there are six owners who control all the ports along the east coast. They have made astounding profits—over 800 percent since the pandemic—while the owners are making tens of millions of dollars; the last thing they need is to profit from this,” he remarked.
Meanwhile, protesters at the main entrance to the port of Baltimore, at the Dundalk terminal, held signs reading: “Machines do not feed families: Support ILA workers,” criticizing the increase of automation in ports.
The striking workers have continuously chanted their demands, energized with megaphones and recalling the strike of 1977, the last time this sector mobilized.
The protesters did not make statements to the press and referred to communications from the ILA, which, in its latest statement, accuses employers of “distorting the facts and misleading the public” regarding the failed attempt at an agreement.
If the protest continues and losses accumulate, 2024 could conclude as a challenging year for the port of Baltimore, especially since earlier in the year, on March 26, a ship collided with the city’s largest bridge, leading to its collapse and the closing of its channel until early June.
Impact of Ongoing Dockers’ Strike on U.S. Trade and Exports
Thousands of dockers in the United States continue to maintain the strike they began on Tuesday, blocking major ports across the country. This ongoing protest has significant implications for trade and exports, especially products from countries like Chile.
Biden Warns of a “Man-Made Disaster”
In response to the strike, President Joe Biden has stated that this demonstration could escalate into a “man-made disaster.” He emphasized the importance of resolving the labor dispute swiftly to protect both workers’ rights and the nation’s economy.
Impact on Chilean Exports
Locally, exports of products such as Chilean wine, salmon, and fruits are in jeopardy due to the strike. Miguel Canala-Echeverría, the general manager of Chile Fruits, reported that over 580 containers of fresh fruits from Chile are currently affected, with some containers stalled in Panama. This situation poses risks to timely deliveries to U.S. distributors, incurring additional costs for exporters.
Challenges Faced by Chilean Industries
- Chilean Winery Crisis: According to Angélica Valenzuela, the commercial director of Wines of Chile, around 280 thousand boxes of wine (not bulk) are at risk this October, equating to about 150 containers. While some wineries are rerouting shipments to different U.S. ports, this isn’t a sustainable solution.
- Salmon Export Troubles: Arturo Clement, president of SalmonChile, expressed that the ongoing strike creates major complications for the salmon export sector.
Government Response to the Strike
The Subsecretary of International Economic Relations (SUBREI) of the Chilean government is actively coordinating with trade and agricultural attachés in the U.S. to monitor the situation closely.
“Although this is a private issue, our teams in the U.S. are in contact with local authorities and port operators to assess the conflict’s impact on Chilean shipments,” SUBREI indicated.
Given that the U.S. is a crucial partner for agri-food exports, SUBREI has committed to closely monitor the evolution of the strike.
Details of the Dockers’ Strike
The protest began early on Tuesday due to a stalemate between the International Longshoremen’s Association (ILA) and the U.S. Maritime Alliance (USMX). The dockworkers are demanding a salary increase of $5 per hour for each of the six years of the new contract and a guarantee against automation that threatens job security.
“We demand a $5 hourly wage increase for each year of the upcoming contract, coupled with an agreement preventing automation,” stated ILA president Harold Daggett.
In the last 24 hours, the two parties have exchanged salary counteroffers, with USMX offering a 50% increase and requesting an extension of the existing contract.
Consequences of the Dockers’ Strike in the U.S.
The strike, which has already seen participation from 45,000 dockworkers, could result in substantial economic losses, with estimates reaching over $2 billion daily. This disruption directly impacts strategic ports that handle 43% to 49% of the U.S. maritime trade, including major hubs like Elizabeth/Newark, Houston, Miami, and Baltimore.
Significance of Baltimore in U.S. Trade
Baltimore, noted as the second-largest coal exporter in the U.S. according to the Energy Information Administration (EIA), is particularly affected by the blockades. The port also plays a key role in the transportation of motor vehicles.
Biden’s Call for Negotiation
Biden has urged both parties to return to the negotiating table, stating, “The last thing we need is a man-made disaster.” He compared the potential impact of the strike to natural disasters like Hurricane Helene, emphasizing the urgency of the situation.
Biden highlighted that six major owners control most of the port operations along the east coast and that their substantial profits—over 800% since the pandemic—do not justify further conflict.
Voices from the Protest
Recent protests at the port of Baltimore, particularly at the Dundalk terminal, saw dockworkers displaying signs proclaiming, “Machines do not feed families: Support ILA workers,” highlighting their concerns about automation and job security.
The striking workers have been vocal in their demands, chanting and carrying signs while refusing to comment directly to the media, instead referring inquiries to the ILA’s communications.
Potential Economic Fallout
If the strike persists and estimated losses materialize, 2024 could pose significant challenges for the port of Baltimore. Earlier this year, a ship collision resulted in the closure of the port channel until early June, demonstrating the port’s vulnerabilities to operational disruptions.
Key Takeaways from the Ongoing Strike
| Impact Area | Details |
|---|---|
| Daily Economic Loss | Estimated at over $2 billion |
| Affected Parties | Incl. dockworkers, exporters, consumers |
| Containers Affected | Over 580 containers of Chilean fresh fruit |
| Outstanding Wine Shipments | 280,000 boxes of wine at risk |