Port strike 2024: Which products could there be shortages and price increases?

NEW JERSEY – Thirty-six U.S. ports, including those in New York, New Jersey, were closed Tuesday as the union representing about 45,000 longshoremen went on strike for the first time since 1977.

ILA Strike Update: PROBLEMS l EFFECTS l HOLIDAY SHOPPING

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Workers began picketing early Tuesday near ports along the East Coast.

A prolonged shutdown could drive up prices for goods across the country, potentially leading to shortages and price increases at retailers large and small as the holiday shopping season approaches.

The International Longshoremen’s Association is calling for significantly higher wages and an outright ban on the automation of cranes, gates and container trucks used to load and unload cargo at 36 U.S. ports. About half of the country’s cargo is handled by ship in these ports.

The contract between the ILA and the United States Maritime Alliance, which represents the ports, expired on Tuesday. Some progress was reported in talks late Monday night, but the union still went on strike.

The union’s opening offer called for a 77% pay increase over the six-year term of the contract, with President Harold Daggett saying it was necessary to offset inflation and years of small raises. ILA members earn a base salary of about $81,000 per year, but some can earn over $200,000 per year with large overtime hours.

On Monday evening, Allianz announced that it had increased its offer to 50% over six years and promised to maintain the automation limits from the old contract. Allianz also said its offer tripled employer retirement contributions and strengthened health care options.

If the strike were to be prolonged, companies would be forced to pay shippers for delays and would cause some goods to arrive late during the peak holiday shopping season – potentially impacting deliveries of everything from toys artificial Christmas trees to cars, coffee and vegetables.

Americans could also face higher prices as retailers feel the pinch of supply.

“Everyone from shipping companies to trade groups to maritime industry analysts are also warning of widespread impacts on the global supply chain,” reported The Maritime Executive, a maritime industry magazine and newsletter. “Sea-Intelligence estimated that for each day of a strike it would take four to six days to clear the backlog. They wrote that even a two-week strike could have an impact into 2025.”

Additionally, according to the American Farm Bureau Federation, 75% of the country’s banana imports were processed through the affected ports.

Chris Butler, CEO of the National Tree Company in New Jersey, tells the AP that if a strike only lasts a few days, there would still be time to unload Christmas trees, transport them to warehouses and prepare them for customers this season.

Ships carrying the trees were on their way to New York but would not arrive until Tuesday. If the strike continues, most of the trees will have to be stored until next Christmas, Butler warned.

If a strike keeps ports closed until November, about 150,000 Christmas trees could miss the peak shopping season, costing the National Tree Company and others. In a worst-case scenario, these costs could drive inflation and weigh on the U.S. economy.

A prolonged strike would require companies to compensate shippers for delays, potentially causing goods to arrive late during the peak holiday shopping season.

MAE ANDERSON and ANNE D’INNOCENZIO contributed to this report with the Associated Press.