The potential strike of 22,000 dockworkers along the nation's West Coast could aggravate current supply shortages and lead to higher prices for consumer goods, The New York Times reported March 28.
Four notes:
1. The International Longshore and Warehouse Union workers' contract expires at the end of June. A potential labor impasse over a new contract could exacerbate supply chain issues. Union officials declined to discuss their objectives for a new contract, the Times reports.
2. Nearly three-fourths of the union workers work at the twin ports of Long Beach and Los Angeles in California, the primary entry point for goods shipped to the U.S. from Asia.
3. Shipping industry experts are split on whether negotiations will lead to a deal without a strike or supply chain disruptions. Some expect negotiations to go smoothly, as ports have captured the attention of President Joe Biden, who mentioned the increasing costs of cargo shipping in his State of the Union address.
"There's too much at stake for both sides," Mario Cordero, executive director of the Port of Long Beach, told the Times. "There's an incentive because the nation is watching."
Others point to 2014, the last time the union's contract expired, which led to disruption at the ports.
4. Some retailers that import products from Asia have been trying to create a buffer in case there is a breakdown in contract talks by ordering extra goods and stockpiling them at newly developed storage yards inside the California ports.
"There are concerns that if there is a strike, they are not going to have access to their cargo," Sepehr Matinifar, vice president of commercial operations at Pacific Terminal Services, which operates the overflow yards, told the Times, adding that Walmart alone has room for 4,000 shipping containers inside the storage yards.
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