Potential U.S. port strike would increase traffic through Canadian ports

The International Longshoremen’s Association (ILA) voted to support a call for a strike at East Coast ports in the U.S.

Nearly 300 ILA wage scale delegates ended their two-day meetings in New Jersey by unanimously supporting international president Harold J. Daggett’s call for a coastwide strike at ports from Maine to Texas, which would begin Oct. 1 if a new agreement with the United States Maritime Alliance (USMX) is not reached by that time.

Frank Kenney, director of industry solutions at Cleo, an end-to-end supply chain integration software company, said a port strike along the U.S. East Coast would significantly increase traffic through the Port of Halifax and Port of Montreal due to their proximity to rail carriers.

“This makes them ideal for inbound and outbound freight. However, the challenge lies in moving goods in and out of Halifax, which often involves rail transportation through the Midwest of the United States, with Chicago as a major hub,” said Kenney. “Berthing at Port Newark in New York offers easier access to East Coast highways and rail systems, but Chicago lies 960 miles to the west, adding at least a day to move freight from there to key hubs in the east. The bottleneck is likely to occur at Port Huron, Mich. This combination of factors—added transit days, double border crossings, maritime operations in Halifax and rail in Huron—will not be optimal.

Kenney said he also expects maritime activity to surge in the event of a port strike, as manufacturers and retailers would look to stock up on goods ahead of a work stoppage and the Holiday season.

“The lingering volatility of the rail worker situation in Canada and the current U.S. election could also contribute to increased demand,” he said. “Depending on the diligence of retailers, we’ll feel the increase in costs but likely not the impact on merchandise availability.”

USMX said it remains committed and prepared to resume negotiations with the ILA on a new Master Contract before the current agreement expires and to avoid a strike.

“The ILA continues to strongly signal it has already made the decision to call a strike and we hope the ILA will reopen dialogue and share its current contract demands so we can work together on a new deal, as we have done successfully for nearly 50 years,” USMX said in a statement.