Per CNBC News, eight cargo vessels had been waiting to dock at the ports of the West Coast on Wednesday, resurfacing the fears of severe ship backup observed throughout the pandemic.
Six vessels at the Port of Los Angeles (LA) and two at the Port of Long Beach (LB) got delayed due to insufficient labour.
Labour slowdowns have gone up as of late, with six ports on the West Coast shutting down over the last week. These slowdowns have been prompted by continuous negotiations between the International Longshore and Warehouse Union and the ports, which have been unable to come to terms on safety, wages, and automation, among other problems.
The situation improved on Thursday, per CNBC, but the cargo is not moving as it does usually.
The Biden administration and the US Department of Transportation are closely monitoring the issues, states CNBC, with retail groups giving warnings of economic peril.
The retailers are alarmed to learn of the work stoppage underway at many West Coast ports, mentioned Jessica Dankert, the VP of supply associated with the Retail Industry Leaders Assn.
If the work stoppage keeps dragging on and contract negotiations falter, the Biden-Harris administration must step in and broker a deal.
The National Retail Federation issued a statement.
The railroad giant Union-Pacific temporarily shut down its inland ramps due to the slowdowns. This provoked the fears of a possible “ripple effect.”
Productivity could deteriorate even further if the containers and products build up at the ports.
Besides, the Port of Seattle further cited labour issues this week, per FreightWaves. The port management has also dismissed the dockworkers for failing to hit about 30 turns per hour, the minimum threshold set by the port. The dismissed employees are permitted to return on the next day.
The labour issue started in July 2022, when over 22,000 dockworkers saw their contracts expiring. Nearly 11 months later, the parties still have not come to terms with wages, safety, and the growing importance of automation. In April, it was reported that progress had been made in the discussions, especially around automation.
The ILWU and the Pacific Maritime Assn. have refrained from commenting on the issue per CNBC, stating a media blackout.
References: Economic Times, Furniture Today, ICIS
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