Cargo carriers warn port strike could cripple half of US trade
PORTS & SHIPPING

Cargo carriers warn port strike could cripple half of US trade

The world's largest container carrier is urging its customers to divert US cargo to East and Gulf Coast ports ahead of a planned dockworker strike set to begin on Tuesday, which could disrupt up to half of the nation's seaborne trade.

In a customer alert issued, MSC Mediterranean Shipping Co. SA informed that ongoing negotiations between the longshoremen's union and port employers might not reach a resolution by the September 30 deadline, potentially leading to terminal closures starting October 1. This would cause delays in the movement of containers, both imports and exports, via trucks and railroads at ports ranging from Boston to Houston. MSC advised that adjustments in bookings, such as rolling shipments to other vessels or canceling them, might become necessary. The Geneva-based company also stated that while it would continue accepting requests for dry cargo services, it reserved the right to stop accepting new bookings for refrigerated cargo.

Similarly, Hapag-Lloyd AG, the world’s fifth-largest container carrier, warned that bulk and breakbulk cargo might also be impacted. The company emphasized that industrial action would likely drive up freight rates. The Hamburg-based carrier noted that shipping costs, including those for freight, warehousing, and drayage, were expected to rise due to increased demand for alternative routes and port services, with the possibility of emergency surcharges being added to cover extra handling and congestion.

Shifting to alternative routes may not be a simple solution. CH Robinson Worldwide Inc., one of the largest US freight brokerages, cautioned that if the strike commences on October 1, alternative routes could quickly become overwhelmed.

Oxford Economics estimated that a strike could cost the US economy between $4.5 billion and $7.5 billion per week. While this economic hit would be reversed once the strike ended and shipments resumed, even a brief strike could be costly for retailers, manufacturers, and other importers who rely on timely shipments and sufficient inventories ahead of the fourth quarter.

Furthermore, Oxford Economics noted that for each week of cargo backlog, it would take approximately a month to clear the delays, as West Coast ports—potential alternative gateways for goods—are already operating at full capacity.

The world's largest container carrier is urging its customers to divert US cargo to East and Gulf Coast ports ahead of a planned dockworker strike set to begin on Tuesday, which could disrupt up to half of the nation's seaborne trade. In a customer alert issued, MSC Mediterranean Shipping Co. SA informed that ongoing negotiations between the longshoremen's union and port employers might not reach a resolution by the September 30 deadline, potentially leading to terminal closures starting October 1. This would cause delays in the movement of containers, both imports and exports, via trucks and railroads at ports ranging from Boston to Houston. MSC advised that adjustments in bookings, such as rolling shipments to other vessels or canceling them, might become necessary. The Geneva-based company also stated that while it would continue accepting requests for dry cargo services, it reserved the right to stop accepting new bookings for refrigerated cargo. Similarly, Hapag-Lloyd AG, the world’s fifth-largest container carrier, warned that bulk and breakbulk cargo might also be impacted. The company emphasized that industrial action would likely drive up freight rates. The Hamburg-based carrier noted that shipping costs, including those for freight, warehousing, and drayage, were expected to rise due to increased demand for alternative routes and port services, with the possibility of emergency surcharges being added to cover extra handling and congestion. Shifting to alternative routes may not be a simple solution. CH Robinson Worldwide Inc., one of the largest US freight brokerages, cautioned that if the strike commences on October 1, alternative routes could quickly become overwhelmed. Oxford Economics estimated that a strike could cost the US economy between $4.5 billion and $7.5 billion per week. While this economic hit would be reversed once the strike ended and shipments resumed, even a brief strike could be costly for retailers, manufacturers, and other importers who rely on timely shipments and sufficient inventories ahead of the fourth quarter. Furthermore, Oxford Economics noted that for each week of cargo backlog, it would take approximately a month to clear the delays, as West Coast ports—potential alternative gateways for goods—are already operating at full capacity.

Next Story
Infrastructure Energy

REC Transfers HVDC Project to Power Grid

REC Limited has successfully handed over the Special Purpose Vehicle (SPV) for a High-Voltage Direct Current (HVDC) transmission project to Power Grid Corporation of India Limited (PGCIL). This strategic move aligns with the nation's objectives to strengthen its power transmission network. Key Highlights: Project Overview: The HVDC project, under the inter-state transmission system (ISTS) initiative, is a critical component of India's push toward robust and efficient electricity transmission. It aims to handle bulk power transfer across long distances while ensuring minimal losses. Role of RE..

Next Story
Infrastructure Transport

NF Railway Collaborates with IIT Guwahati

The Northeast Frontier (NF) Railway has signed strategic Memorandums of Understanding (MoUs) with IIT Guwahati to foster technological advancements and improve railway operations in the region. This partnership focuses on innovative solutions to enhance safety, efficiency, and sustainability in rail infrastructure. Key Highlights: Purpose of MoUs: The collaboration aims to leverage IIT Guwahati's expertise in technology and research for implementing cutting-edge solutions across railway operations. Key areas of focus include: Automation and digitization in maintenance. Sustainability initiati..

Next Story
Infrastructure Transport

Danapur Division Modernization Plans Revealed

The Railway Board has unveiled ambitious plans for the expansion and modernization of the Danapur Division, a critical hub under the East Central Railway. The initiative focuses on infrastructure development, enhanced passenger amenities, and operational efficiency. Key Highlights: Scope of Modernization: The Railway Board's blueprint emphasizes: Upgrading existing infrastructure to accommodate more passenger and freight traffic. Improving station facilities, such as platforms, waiting areas, and connectivity. Introducing advanced signal systems for safer and smoother operations. Freig..

Hi There!

"Now get regular updates from CW Magazine on WhatsApp!

Join the CW WhatsApp channel for the latest news, industry events, expert insights, and project updates from the construction and infrastructure industry.

Click the link below to join"

+91 81086 03000