ICAT Blog: Article Preparing for a Potential Port Strike on January 15

A potential port strike by dockworkers at East and Gulf Coast ports looms on January 15, 2025, presenting itself once again after a tentative agreement that was reached back in October is set to expire. The International Longshoremen’s Association (ILA) and the U.S. Maritime Alliance (USMX) now face a deadline to resolve disputes over wages and automation policies. If unresolved, this could disrupt operations at 36 major ports, affecting industries reliant on imports and exports, including retail, manufacturing, and automotive.

• Retail: The retail sector has a heavy reliance on imports with goods often arriving just-in-time for sales. Delays in consumer goods shipments in particular could have an impact on post-holiday restocking.
• Manufacturing: Manufacturing depends on foreign suppliers for things like metals, machinery, and electronic components. Disruptions in raw material supplies could slow production lines.
• Agriculture: This industry relies on the East and Gulf Coast ports for global distribution. Export delays may harm U.S. competitiveness amid weak global demand.
• Automotive: The automotive industry is ingrained in globalized supply chains with critical parts and vehicles imported through major ports. Interruptions in the supply of vehicle components would inevitably delay assembly lines in the U.S.
• Energy and Chemicals: There is a concentration of energy imports that take place at Gulf Coast ports. The strike could reduce the availability of imported crude oil, LNG, and industrial chemicals.

What Businesses Should Expect if the Strike Happens

A port strike on January 15 could significantly disrupt operations across various industries. Businesses should anticipate the following:

1. Delays in Import and Export Logistics: Essential goods like raw materials, consumer products, and agricultural exports could face weeks-long delays.
2. Higher Freight Costs: Limited capacity may force businesses to rely on air freight or alternative ports, increasing transportation expenses.
3. Supply Chain Bottlenecks: Domestic transportation avenues, like rail and trucking, could experience congestion as companies reroute goods.
4. Economic Ripples: Retailers may struggle to restock post-holiday inventories, while manufacturers could see stalled production lines due to material shortages.
5. Reputational Risks: Delayed deliveries could lead to customer displeasure and lost sales opportunities.

What Businesses Should Do if the Port Strike Occurs

If the port strike occurs, businesses should implement the following measures to minimize disruptions:

1. Activate Contingency Logistics Plans

• Use alternate ports or transportation methods, such as air freight or inland terminals.
• Engage with your ICAT Logistics representatives/account managers to secure priority shipments.

2. Communicate Transparently

• Inform customers and suppliers of potential delays, providing updated timelines and solutions.
• Offer alternative products or services if key items are delayed.

3. Optimize Inventory Management

• Utilize existing inventory strategically, prioritizing high-demand items.
• Accelerate production and storage of important goods before strike-related delays worsen.

4. Collaborate Across the Supply Chain

• Coordinate with suppliers, distributors, and logistics providers to streamline responses and solutions.
• Leverage digital supply chain tools for visibility and quicker decision-making.

5. Monitor and Adapt in Real-Time

• Subscribe to industry updates, port authority notifications, and news alerts from ICAT and industry outlets for timely information.
• Stay updated on strike developments and adjust plans as negotiations evolve.
• Use predictive analytics to assess long-term effects and mitigate risks proactively.

International shipping can be overly complex and daunting. When you throw in bottlenecks like port strikes and other logistical disruptions, it can seem almost impossible to navigate the global supply chain effectively. With firsthand experience in these scenarios, our subject matter experts can proactively address these challenges, provide insights, and devise effective solutions, ensuring your operations remain smooth and uninterrupted.