This week:

• ILA reveals strike mobilization plans as wages, automation remain contract sticking points
• Local vice presidents appointed to ILA strike action coordination committees
• Global supply chain industry tests out contingency plans ahead of potential October 1 strike
• US truckload spot market gets temporarily hot at end of summer, still down year-over-year
• Port of Baltimore hires former Port of New Orleans COO for new business development role

ILA Unveils Strike Mobilization Plan as USMX Vows to Reach Contract Deal

On Thursday, September 5, the International Longshoremen’s Association (ILA) revealed a strike mobilization plan ahead of contract negotiations with the United States Maritime Alliance (USMX). With the current contract expiring at the end of this month, the plan is the latest sign that the ILA will be ready to strike at US East and Gulf Coast ports on October 1.

The ILA revealed the plan during a previously scheduled wage scale meeting in Teaneck, New Jersey. ILA Executive President Harold Daggett shared a public YouTube video outlining the union’s position. Daggett said the ILA will “most definitely” strike if it doesn’t get the contract concessions it seeks.  Wage demands and ILA concerns about automation practices remain the primary points of contention. 

The current six-year contract expires September 30, and ILA officials have publicly stated that the two sides are “very far apart” in their talks. USMX officials responded by saying they’re prepared to resume negotiations and hope to reach a deal that would avoid a strike.

The potential strike could spell disaster for the US supply chain, with economic impacts felt across the globe. In response, shippers have been front-loading cargo, leading to increased volumes at the US West Coast and other ports.

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ILA Appoints Local VPs to Lead Strike Action Coordination Committees

As part of ILA’s strike mobilization plan, the union appointed local vice presidents to lead strike action coordination committees. The 13 committees will allow local union officials to support ILA’s executive leadership’s message and negotiation stance.

In the YouTube video released September 5, ILA Executive Vice President Dennis Daggett expressed thanks for the efforts of ILA local chapters amid the ongoing negotiations. “Our members showed the world just how valuable our work is during the pandemic, and the carriers and terminals came out of that time with record profits, and they don’t want to share that with our members,” Daggett said.

ILA President Harold Daggett also addressed local union members in the video, saying, “Sisters and brothers, it will be monumental if we are without a new master contract to replace the current one that expires in three weeks and four days. We must be prepared if we have to hit the streets on Tuesday, October 1, 2024.”

As Strike Threat Looms, Trans-Atlantic Shippers Explore Contingency Plans

With the potential ILA strike just a matter of weeks away, US importers and their service providers are testing several contingency plans in case a deal between the ILA and USMX doesn’t reach an agreement before September 30.

These alternatives include routing to the US via Canada. “In Canada, we have been testing the services, getting truckers set up for the alternative to rail even though the rail strike has been resolved for now,” Alison Leavitt, managing director of the Wine and Spirits Shippers Association (WSSA), said during a Journal of Commerce (JoC) webinar last week. 

Leavitt added that her company is exploring “routing through Halifax, Montreal, even a little bit through St. John.” However, Leavitt conceded that while there are some re-routing options, “It’s just going to be a huge problem should a strike occur.” 

Meanwhile, Eric Oak, senior analyst for supply chain at S&P Global Market Intelligence, told the JoC that diverting imports to the US West Coast is the only viable alternative for US companies importing from Europe. However, he sees a problem where re-outed cargo will clash with eastbound trans-Pacific shipping activity.

”Shipments from North Europe to the West Coast are going to be competing with a massive amount of Asian cargo that’s coming through and looking for berth space and time in port,” Oak told the JoC.

US Spot Truckload Volumes Increase, Market Still “Soft” Overall

US truckload spot volumes got hot as summer started to wind down, leading to capacity and load-to-truck ratios tightening. However, analysts still see the inland truckload spot market as “soft” overall. 

According to Dean Croke, principal analyst for DAT Freight & Analytics, in a conversation with the JoC last week, the long-term truckload market outlook is “flattish” until 2025. “We’re still seeing softer volumes over the longer arc of time,” Croke said. This is despite spot truckload capacity getting tighter around Labor Day at critical distribution points like Allentown, Atlanta, and Charlotte.

DAT’s analysis shows spot truckload volumes were down 17% year-over-year in the last week of August. Truckstop.com data corroborates this, with load posts down 7.6% from the same week one year ago, despite recent week-to-week increases of around six percent.

Port of Baltimore Hires Former New Orleans Port COO for Business Development