Posted on 09/28/2024 10:30:51 AM PDT by thegagline
A looming strike by dockworkers at ports from Massachusetts to Texas could snarl supply chains and raise prices on a wide array of consumer goods—just as the holiday shipping season approaches.
Members of the International Longshoremen's Association, a union representing 85,000 dockworkers, plan to strike Tuesday if they can't reach agreement on a new contract with the United States Maritime Alliance, which represents large shipping lines.
A walkout would be the first East Coast dock strike in the U.S. since 1977.
A strike would shut down container facilities at 14 ports stretching from Boston to Houston. Those ports handled more than 68% of all containerized U.S. imports last year.
Here's a look at some of the ways a strike could affect the U.S. economy.
Shipping Delays
The most immediate impact would be that goods would stop getting unloaded at the affected ports. Even if the strike only lasted for a few days, the ripple effect would continue for weeks or longer.
In addition to costing the U.S. economy as much as $5 billion per day—a run rate equaling 6% of U.S. annual gross domestic product (GDP)—transportation analysts at J.P. Morgan said Thursday in a research note that major shipper and logistics company Maersk has estimated that it would take four to six weeks to work through shipping backlogs for each week the ports don't operate.
That could have profound implications for retailers and consumers awaiting goods for the holiday shopping season, which accounts for a fifth of all annual U.S. retail sales revenue. "For retailers, that means holiday shipments might not arrive on time," the National Retail Federation warned earlier this month.
Some retailers are trying to defend against a possible shutdown. Costco Chief Executive Officer Roland Vachris on Thursday said on a company conference call following its earnings release that Costco is pre-shipping in anticipation of a strike."The port strike is something we've been watching very closely for some time. ... We've done several different things that we could to get holiday goods in ahead of this timeframe and looked at alternate plans that we could execute with moving goods to different ports and coming across the country if needed," Vachris said on the call, a transcript of which was made available via AlphaSense.
Escalating Prices
A strike Tuesday would occur just two weeks after the Federal Reserve cut interest rates for the first time since the pandemic. The Fed's decision coincided with moderating inflation. Its favored consumer inflation gauge fell 2.2% in August, the lowest level in three-and-half years.
An extended strike, though, could again drive prices higher—and potentially meaning a stumbling block on the Fed's rate-cut path. The ports that could close Tuesday haven't shut down for a strike since October 1977. That strike lasted 44 days.
Similar to this year, monthly inflation rates declined throughout the summer and early fall then. But in the wake of the strike, inflation in November rose 0.5% from the previous month, the first time in six months it had increased year-on-year.
A port strike likely would also raise global freight rates, which are in a prolonged slump. At least in the short term, that would benefit shippers but raise costs for their customers and consumers.
"Recent freight [rate] recessions have ended suddenly when a disruption shocked the market," JP Morgan said in its recent research note on the dockworkers' labor negotiations. "A potential ILA strike could be a catalyst to end the current malaise."
Supply Shortages
The volume of goods moving through ports along the East and Gulf coasts means that consumers and businesses could face shortages of products from electrical equipment to footwear.
Cars and auto parts sit near the top of the list. European-made automobiles traditionally ship through East Coast ports; no U.S. port handles more passenger vehicle imports than the Port of Baltimore.
At the other end of the price spectrum, buyers of cheap produce beware: About 75% of all bananas imported into the U.S. come through East or Gulf Coast ports. Consumers may have to go without them if a strike ensues.
Jason Miller, a supply chain professor at Michigan State University, said in a recent social media post that shifting those banana imports to West Coast ports or flying them on planes isn't economically feasible, adding that "you can't frontload a perishable product."
Los Angeles/Long Beach not in the top 120 ?
No surprise to me. China dominates the port list because they dominate exports to the entire world.
Prepper ping.
“I’m disabled, so is my husband for other reasons and may just have diabetes (don’t know yet, has symptoms). He’s up for a physical Tuesday.”
A simple blood test can determine that.
“We’ve got some staples and frozen pizzas and stuff to get us through and if we just eat beans and rice and soup, etc for a while then that’s what we’ll eat.”
I have 17, 6-tier shelves in the basement, stocked with food, ammo, medical, TP, paper towels, condiments, electronics etc etc. I’ve been ‘prepping’ since 2003 — thank to FR’s preppers — and if you were nearby, I’d help stock you up.
this list looks bogus.
Where is Houston? New Orleans? Long Beach? Norfolk?
I’ve shipped a LOT of containers... these are the ports we normally use.
San Antonio? As a port? lol
I’m not buying this list.
Now, imagine a major west coast earthquake.
That would make things bad for a few days.
Is Pete Buttigieg negotiating? It is no good.
Charleston is number 53
Why would any company EVER use union labor? It’s the stupidest thing I’ve ever heard of.
You don’t have to buy the list as it is available for free😉
Houston is 312
New Orleans is 167
Long Beach is 373
The port in the area of Norfolk is known as The Port of Virginia which is ranked 301
As for you laughing at the Port of San Antonio, the citizens of Chile don’t find is so humorous.
But since you do find it funny, here is a picture so you can laugh some more
(From the article) : "A looming strike by dockworkers at ports from Massachusetts to Texas could snarl supply chains
and raise prices on a wide array of consumer goods—just as the holiday shipping season approaches."
"Members of the International Longshoremen's Association, a union representing 85,000 dockworkers, plan to strike Tuesday
if they can't reach agreement on a new contract with the United States Maritime Alliance, which represents large shipping lines."
"A walkout would be the first East Coast dock strike in the U.S. since 1977."
A strike would shut down container facilities at 14 ports stretching from Boston to Houston.
Those ports handled more than 68% of all containerized U.S. imports last year."
"Here's a look at some of the ways a strike could affect the U.S. economy."
" Shipping Delays
The most immediate impact would be that goods would stop getting unloaded at the affected ports.
Even if the strike only lasted for a few days, the ripple effect would continue for weeks or longer."
"In addition to costing the U.S. economy as much as $5 billion per day—a run rate equaling 6% of U.S. annual gross domestic product (GDP)
—transportation analysts at J.P. Morgan said Thursday in a research note that major shipper and logistics company Maersk has estimated
that it would take four to six weeks to work through shipping backlogs for each week the ports don't operate. "
(The article continues..)
The question I have is whether or not this would throw us into the recession we’ve been concerned about happening.
Or the economic collapse.
How could this affect the stock market?
San Antonio, Chile ? Who knew ?
This list is very different from tonnage, or dollars. I guess the difference is petroleum shipments, which don’t go by container.
Still though, I’m surprised. We ship thousands of containers through Norfolk and Long Beach. I would have assumed they’d be higher.
I actually visited every city in the Top 10. Most in the Top 20
Correction : I’ve never been to Algeciras
It depends on how long Biden lets it go before intervening. If prolonged, the hit to the economy in its present state could be very nasty.
This would definitely throw the US economy into a "Froot Loop" condition.
Biden has already stated that he would not interfere in a strike deadline, ..even if he was on vacation again at a Delaware beach resort.
The mood is gloomy as this would affect inbound (imports, debt) and outbound (exports, income) materials; it may well be that he intends to sabotage whomever wins the November election
whether by inaction, or acting un-Presidential
In election parlance, we refer to this as an 'indolent, pre-teen,'hissey-fit' (!), or the 'F... Y'all' kiss off by someone threatened by the 25th amendment, by Pelousey.
In a Waylon Jennings voice
🎶🎵 Well, I've never been to Spain
But I kinda like the music
Say the ladies are insane there
And they sure know how to use it
They don't abuse it
Never gonna lose it
I can't refuse it
Doctor won’t just do an A1C on him, he’ll want to assess other symptoms via a physical exam (which he really needs, his gastro doc doesn’t give a crap about him and we’re not seeing that punk again ever).
Was there recently for gastro issues and this cretin was everything and cruel to my beloved man. Charged me $144+ out of pocket (no insurance).
And also run other bloodwork to rule out anything else or to clarify just how serious a case of diabetes he has (Type I, Type II).
He hasn’t had a full work up in a year. A lot can change in a year. And it has. With an extreme amount of weight loss despite caloric intake. Rapid loss of weight.
Could be Chrohns. Could be diabetes. The pain isn’t there like it would be with Chrohns. And I know this doctor will really look hard at what is going on, I really like him.
My own GP won’t do an A1C without checking with a CBC as well and thyroid ( unless it’s been fairly recent). I have hypoglycemia that isn’t related to diabetes.
It’s sneaky.
I prefer the version sung by Cory Wells from Three Dog Night. 🤗
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