Update: USA port strike ends after provisional agreement between unions and employers

Update 4 October: US port strike ends

American dockworkers' unions and employers have reached a provisional agreement, bringing the port strike along the East and Gulf Coasts of the United States to an early end.

It has been agreed that the over 45,000 dockworkers will continue working under the current wage conditions until early 2025. Thereafter, wages will be gradually increased over the next six years. Despite this wage agreement, consensus still needs to be reached on other issues such as improving working conditions and the planned automation of American ports.

Due to the early termination, the domino effect of this strike appears to be minimal for the time being.

Update 2 October: America hit by major port strike

The main cause of this strike is an ongoing labor dispute that has been dragging on for months between the major unions and employers in the American port industry. The core of this conflict revolves around wage demands and working conditions. Port workers are not only demanding higher wages to cope with rising inflation, but there are also complaints about the workload and safety in American ports. Unions and employers failed to reach an agreement, resulting in the long-anticipated strike finally taking place.

What are the potential impacts on your supply chain?

 Our estimate is that for every day of the strike, it will take four to six days to clear the backlog at the ports. Additionally, the closure of the ports will impact port-rail operations, meaning that freight will not be transported via rail in or out of the affected ports. Finally, ships bound for the U.S. East Coast and Gulf ports will remain anchored offshore until the ports reopen, and they can unload their cargo.

The immediate consequences of the strike are delays, but the impact extends beyond that. The disruption leads to port congestion, particularly in Europe, and a shortage of containers. These effects may have long-term repercussions and could significantly affect your supply chains.

Increasing congestion at European ports

Due to the strike, ships en route to the United States cannot proceed. This leads to congestion at European ports, such as Rotterdam, where terminals are becoming full, and ships are forced to wait. This increases pressure on port capacity, resulting in longer waiting times for loading and unloading.

Container shortage 

Additionally, the strike is causing a global shortage of containers. Normally, these containers return from the U.S. to Asia or Europe, but now they are stuck. This container shortage is particularly affecting China, a crucial hub in the global flow of goods to Europe. The scarcity of containers is driving up prices further, especially as several shipping companies have already announced surcharges related to this strike.

Staying ahead of supply chain disruptions

Companies that depend on these logistical routes should prepare for potential delays, higher costs, and limited capacity. Given the current strike, it’s important to closely monitor your in-transit goods. Identify which shipments are urgent and need to be replaced quickly, and consider alternative shipping options such as air freight, combined air-sea transport, or different ports to minimize delays.

Another option is to wait for the strike and further negotiations to conclude for non-urgent goods in transit. This could be a good choice if the delay does not have a major impact on your supply chain. Additionally, it is wise to spread new orders across different shipping methods and entry points to reduce the risk of prolonged disruptions.
Although alternatives such as air freight can provide temporary relief, the long-term impact of the strike will remain noticeable. By planning and responding flexibly to the situation, you can mitigate the negative consequences as much as possible.

At DSV, we are working closely with our carriers to manage the situation as effectively as possible and to minimize the impact on your business. We continuously monitor the situation and will keep you informed of relevant updates in a timely manner. We greatly appreciate your understanding during these challenging times. For further questions or support, please feel free to contact your local DSV representative.