Negotiations between the International Longshoremen’s Association (ILA) and the US Maritime Alliance (USMX) resumed on Tuesday and are set to continue through to Thursday in New Jersey, under the auspices of a federal mediator. Having been extended on two previous occasions, in August and December 2012, the $1.8 billion master contract covering over 14,500 jobs on the U.S. East and Gulf Coasts is set to expire February 6th.
Due to the presence of the Federal Mediator there is very little information being released to the public on the situation. In fact, other than saying the conversations will continue, both sides have been instructed not to discuss the meetings with the outside world,
By now, millions of people around the world are anxiously following the developments as a port shutdown would dramatically affect retailers, manufacturers, farmers, importers, exporters, and others who rely on the ports to move commerce. Many have been continuously preparing for a supply chain disruption and have implemented costly contingency plans.
Efficient ports are an integral part of the global supply chain. Any disruption significantly impacts America’s stature in the global marketplace. Emergency protocols to reroute goods and merchandise not only create significant costs for U.S. businesses – they inevitably trickle-down to impact American consumers. As a daunting reminder, the 10-day West Coast port lockout in 2002 cost the economy a $1 billion a day and took over six months to recover. A comparable shutdown along the East Coast and Gulf Coast ports could have an even greater impact on today’s economy since these 14 ports are responsible for roughly 45 percent of all U.S. trade.
At this time, the best information we can provide is that things are moving along and look positive, according to the most recent unofficial report. Officials at several East and Gulf Coast ports report they are monitoring the negotiations closely and will announce contingency plans if a work stoppage appears likely. At OL&T, we have received notices from several container ship lines serving East and Gulf Coast ports that urge our customers to pick up import containers and return empty boxes before the February 6th deadline. We will continue to provide updates as we receive them.
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Source: The Journal of Commerce, National Retail Federation