Following a port strike lasting three days in the U.S. East Coast last October and the International Longshoremen’s Association (ILA) struck an agreement with United States Maritime Alliance (USMX) for the possibility of a wage hike of 65 percent in the coming six years. The negotiations began in November. unresolved issues, including the automatedization of U.S. ports – resumed however, they fell apart. The ILA attempts to stop U.S. ports from getting automated in order to preserve dockworkers working in their positions. In the last week, talks between dockworker and employee unions continued all across both the U.S. East and Gulf coasts with the aim of preventing the possibility of another strike at ports on the 15th of January. “This is when the current contract that is between ILA as well as USMX expires. It’s the same time that President-elect Trump takes the oath,” says Pat Compres of Advance Customs Brokers.

Compres believes that USMX and carriers may not want to compromise quickly since automation is extremely needed. “If USMX would change its attitude on automation, ports could be unable to implement automation until the end of six years, for the length of the agreement.” There are a myriad of uncertainties in the present, Compres and her business co-partner Maria Bermudez believe a strike could happen. “In the real world, we don’t know however, I believe ports might be shut for a couple of days,” says Bermudez. As the president Trump starting his presidency on the 21st of January, it is likely that this is one of his first concerns he’ll deal with. “He has been updated and conscious of the current situation which means he will be able to act swiftly following his announcement. In the end, it would not be a good way to begin a new presidency.”

Change towards bulk vessels

What could importers and shippers do? “It is best to be optimistic and prepare for the worst” said Compres. “First first I suggest that importers and shippers to examine the agreements they have with their transporters and figure out whether they are able to protect themselves.” Additionally, it’s essential to come up with a new method to transport cargo. “As an instance, Peru got ahead of the curve by launching large vessels for the first time,” said Bermudez. In contrast to container ships the bulk vessels won’t be affected by strike since they are arriving at ports that are not part of the ILA, such as Gloucester City, New Jersey. “Chile as well as South Africa have been using bulk vessels for quite a many years and this may prove to be an excellent alternative for Peru.” Air-based shipments can also offer an alternative to ocean shipping, but what is the price?

Produce deliveries that originate from South America are expected to be most affected, and delays could occur on both coasts. Although the strike will be limited to East Coast ports, congestion will be expected for ports on the West Coast. “California is already very active with regular cargoes and any cargo added towards on the West Coast will create backlogs and lead to delays.” Produce coming from Central America won’t be much in the way since the region relies on regional carriers which have terminals that are not ILA.

Compres considers that all merchandise that arrives prior to the 15th of January should be taken from the ports by midnight that same day. If the cargo is not removed from the port, buyers should inquire with the carriers about their force majeure and demurrage rules. “If there is any produce floating in the sea when the strike is in progress, vessels may wait on water that is open until ports are reopened. When they reopen, anticipate delays when offloading vessels as well as the congestion in terminals” she added.

For further information:

Pat Compres

Advanced Customs Brokers

Tel: 786-476-0700

[email protected]

www.advancecustomsbrokers.com