News / Carriers plan for new US east coast port strike as contract deadline looms

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Negotiations between the dock workers’ International Longshoremen’s Association (ILA) and port employers the United States Maritime Alliance (USMX) now have a very short window to produce a new master contract before a new strike, forcing box lines to mitigate the impact.

The current master contract between workers and employers on US east and Gulf coast ports will expire on 15 January and, if no new agreement is reached by then, a coast-wide strike on 16 January is expected.  

Negotiations have made no progress since September when the parties agreed on wages – a 62% increase. Automation remains the major impasse between the longshoremen and their employers.

The USMX argues that increased automation is essential for productivity, while the ILA argues it will reduce the availability of human jobs. 

US media reports negotiations are set to continue on 7 January, leaving just eight days for the USMX and ILA to agree a new master contract.  

Meanwhile, Maersk urged customers: “We strongly encourage our customers to pick up their laden containers and return empty containers at US east and Gulf coast ports before 15 January. This proactive measure will help mitigate any potential disruptions at the terminals.”   

The Danish carrier said it was “actively developing contingency plans to minimise the impact, should a labour disruption occur”. 

The master contract will expire just five days before the inauguration of Donald Trump as the 47th US president, which may be a significant factor in the negotiations. S&P Global VP Peter Tirschwell told podcast The Freight Buyers Club Mr Trump would “side with the union, 100%”. 

He added: “They go on striken then. They’re on strike for five days. Trump comes into office as the knight in shining armour who tells the ocean carriers ‘there’s going to be hell to pay, unless you agree to what the union is asking’, and he saves the day.” 

In the event of a strike, German carrier Hapag-Lloyd announced it would introduce Work Disruption and Work Interruption Destination surcharges from 20 January, “to help manage the potential impact of ongoing challenges at US east coast and Gulf ports”. 

The surcharges would cover “additional costs from labour disruptions, strikes, slowdowns, unrest, congestion and other unforeseen events that may delay operations and incur extra handling, storage, and feeder service costs”, it explained.  

Both surcharges will add $850 per teu for imports to east and Gulf coast ports, but will not apply to containers already on the water or gated-in before 20 January, and will only affect cargo gated-in on or after 20 January.