Inbound cargo volumes at the country’s major container ports could see a near-record surge this month, a new report has found.
According to the Global Port Tracker report released this week by the National Retail Federation and Hackett Associates, retailers bringing in merchandise ahead of a potential strike at East Coast and Gulf Coast ports this fall could result in record inbound cargo volumes.
“Retailers are concerned by the possibility of a strike at ports on the East and Gulf coasts because contract talks have stalled,” NRF Vice President for Supply Chain and Customs Policy Jonathan Gold said. “Many retailers have taken precautions including earlier shipping and shifting cargo to West Coast ports. We hope to see both sides resolve this issue before the current contract expires because retailers and the economy cannot afford to see a prolonged strike. This comes on top of ongoing disruption issues including the attacks on commercial vessels in the Red Sea. Vessel diversions have led to increased shipping times and costs and have led to equipment shortages and congestion in Asian ports.”
The report said the contract between the International Longshoremen’s Association and the U.S. Maritime Alliance covering the East Coast and the Gulf Coast ports is set to expire at the end of September. As negotiations between the two groups has broken down, the ILA has threatened to strike if a new contract cannot be reached. The NRF said it has continued to urge both side to return to the bargaining table and continue negotiations. The looming deadline and rising freight rates have driven importers to ship early.
“Importers are continuing to grow their inventories and are shifting cargo to the West Coast as a precaution against potential labor disruptions,” Hackett Associates Founder Ben Hackett said. “We calculate that the shift has pushed the West Coast share of cargo we track to above 50% for the first time in over three years.”