From Maine to Texas, dockworkers at 36 ports across the eastern United States are on strike for the first time in decades, a work stoppage that could snarl supply chains and cause shortages and higher prices if it stretches on for more than a few weeks.
Workers began walking picket lines early Tuesday in a strike over wages and the ports' use of automation, though some progress was reported in negotiations over a new contract.?
In Louisiana, about 700 port workers in New Orleans and about two dozen working at Port Allen in Baton Rouge are expected to participate in the strike.?
The existing contract between the ports and about 45,000 members of the International Longshoremen’s Association expired at midnight.
The strike, coming weeks before a tight presidential election, could become a factor in the race if shortages begin to affect many voters. Pressure could eventually grow for the Biden administration to help facilitate a settlement, though the administration has said it doesn't plan to intervene beyond encouraging both sides to reach an agreement.
The U.S. Maritime Alliance, which represents the ports, said Monday evening that both sides had given some ground on their previous wage demands. But no deal was reached.
In New Orleans,?more than 100 workers had lined up by midmorning Tuesday at the Felicity Street entrance to the Port of New Orleans, joining the picket line.?
The Port of New Orleans photographed from the Mississippi River in New Orleans, Friday, June 14, 2024. (Photo by Sophia Germer, The Times-Picayune)
How will the strike affect prices??
Consumers won't likely feel any consequences from the strike right away, supply chain experts say. In anticipation of a strike, most major retailers have stocked up on goods, moving ahead shipments of holiday gift items.
But if the work stoppage drags out for more than a few weeks, consumers could feel the effects.
If drawn out, the strike could cause some goods to arrive late for peak holiday shopping season, potentially disrupting the delivery of anything from toys and artificial Christmas trees to cars, coffee and fruit.?
The strike will likely have an almost immediate impact on supplies of perishable imports like bananas. The ports that are affected by the strike handle 3.8 million metric tons of bananas each year, or 75% of the nation’s supply, according to the American Farm Bureau Federation.
Coffee could be affected, too,?as the Port of New Orleans, which handles almost all of Louisiana's container ship volume, is one of the biggest coffee importers in U.S.?
Though consumers might face higher prices for some of these items over time, businesses will likely take hits sooner. In addition to paying for delays, competition to keep prices down or relatively stable may lead some affected companies to incur extra costs.
Jay Foreman, CEO of Basic Fun, which makes such toys as Care Bears and Lincoln Logs, said he has been monitoring the port situation for months and planned for it by shifting all container shipments to West Coast ports. But he said the shift added anywhere from 10% to 20% extra costs that his company will have to absorb.
Foreman added that Basic Fun’s prices for the next 10 months are locked in with retailers but that he might have to raise prices during the second half of 2025 if the strike is prolonged.
“We were expecting a good holiday season, but now those extra costs are going to eat into profits,” he said. “It affects raises and bonuses.”
The strike could also snarl exports from East Coast ports and create traffic jams at ports on the West Coast. Railroads say they can ramp up to carry more freight from the West Coast, but analysts say they can’t move enough to make up for the closed Eastern ports.
J.P. Morgan estimated that a strike that shuts down East and Gulf coast ports could cost the economy $3.8 billion to $4.5 billion per day, with some of that recovered over time after normal operations resume.
