Potential for 2024 East Coast Port Strike Kickstarts Supply Chain Contingency Planning

U.S. ports on the East and Gulf coasts are facing potential supply chain disruptions before the new year even begins. International Longshoremen’s Association (ILA) President Harold Daggett, speaking at an ILA education conference earlier this month, warned members to prepare for a strike if a new agreement is not reached by Sept. 30, 2024.

The ILA, which represents 45,000 dockworkers at the ports, is seeking higher wages and control of the longshore workforce. Daggett has made clear that there will be no extension of its existing agreement if the United States Maritime Alliance (USMX), which represents employers at East and Gulf coast ports and the shipping lines serving them, cannot reach a deal.

The impacts of a strike would be far ranging as the region is home to some of the country’s largest metropolitan areas and major ports, such as New York/New Jersey, Miami, Houston, and Baltimore. The numbers and types of goods imported through the East Coast is also quite diverse and could cause disruption to several major industries, including automotive parts, pharmaceuticals, apparel, computers, and industrial supplies.

“With 2024 still expected to be a relatively slow market, the chaos this would create is less than what it would have been if a strike were on the table a year ago,” said Glenn Koepke, general manager of network collaboration at FourKites, “Shippers and BCOs will need to take into account the potential long lead times as they chart out their risk and supply chain network in 2024.”

The East Coast is also at risk of losing volume gained from similar union strikes at West Coast ports over the last two years as shippers looked to avoid backlogs and delays.

“While volume is likely to shift back west over time, the threat of labor strikes might accelerate the reversion to historical norms,” said Koepke, adding that the 2024 presidential election is likely to create further disruption as supply chain planning teams, CFOs, and risk management teams work to sort out what's real versus noise.

Importers and shippers should already be preparing

As supply chain risks continue to unfold for the coming year, communicating and collaborating with suppliers, partners, and customers will be even more critical to ensure your operations are prepared for whatever lies ahead.

To start, Koepke said, shippers must have up-to-date, pressure-tested continuity plans, as well as systems in place for mass communication and process management. This means mapping out where raw material products are sourced, where finished goods are being shipped, the routing locations, and estimated exposure to disruption—all of which will be key to understanding the breadth of continuity plans.

Supply chain visibility and management tools can also help businesses evaluate exposure and answer these critical questions, such as how much product is coming via ocean. Kopeke said this allows shippers to determine how they can adjust delivery schedules and routes should they need to leverage alternative shipping lanes or modes of transportation.