Story by Deena Zaidi
A massive dockworkers strike could impact cargo movement of leading importers operating on the East Coast and Gulf ports, including Walmart (WMT) and General Motors (GM), according to trade data aggregator Import Genius.
If no agreement is reached, several terminals at these ports could cease operations, affecting products shipped in containers and threatening the global supply chain. This could eventually increase the prices of commodities across almost all industries — from retail and automotive to manufacturing.
Ocean carriers such as Maersk, CMA CGM, Hapag-Lloyd, and other carriers have already announced surcharges for port strike disruptions. Effective Oct. 21, Denmark-based carrier Maersk is implementing a surcharge on the impacted ports, ranging from $1,500 for a 20-foot container to $3,780 for a 45-foot container.
“This surcharge is necessary to cover the higher operational costs that will be incurred due to the service disruptions, ensuring the sustainability of our services and ongoing support for your supply chain requirements,” Maersk said.
CMA CGM will start charging from Oct. 11, followed by Hapag-Lloyd on Oct. 18.
The U.S. Department of Transportation is closely monitoring attempts that could raise prices. In a statement released on Oct. 1, Transportation Secretary Pete Buttigieg called on ocean carriers to withdraw surcharges. “No one should exploit a disruption for profit, especially at a time when whole regions of the country are recovering from Hurricane Helene,” the statement read.
“With a strike now in place at all East Coast and Gulf Coast ports, NRF is urging President Biden to intervene and use all necessary tools, including the Taft-Hartley Act, to immediately resume the flow of cargo at these essential ports and get the negotiating parties back to the table,” Jonathan Gold, the vice president of supply chain and customs policy at the National Retail Federation (NRF), told Quartz in a statement.
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The last time a president invoked the Taft-Hartley Act was during the West Coast port lockout in 2002 under President George W. Bush. The law allows the President to intervene in labor disputes that pose a risk to national security or public safety, by enforcing an 80-day cooling-off period. This requires workers to return to their jobs while negotiations continue.
“This is a critical time for retailers and other businesses ahead of the holiday season. The longer this disruption lasts, the more harm it will cause to the economy and the millions of businesses, workers and consumers who rely on the seamless flow of goods, both imports and exports, through the East Coast and Gulf Coast ports,” said Gold.