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Port Strikes Threat Assessment

September 19, 2024 | TLP: CLEAR

Healthcare Ready is MONITORING for this event. We are monitoring potential concerns for supply chain disruptions and impacts on healthcare services on our Alert Hub.

Contents

• Situation Overview
• Potential Impacts to Supply Chain

Situation Overview

• East Coast and Gulf Coast port workers are planning to strike on October 1 if a new labor agreement contract isn’t reached by midnight on September 30.
• On September 17, the Biden administration stated that they do not intend to invoke the Taft-Hartley Act to prevent a port strike if a new labor contract isn’t reached.
• The International Longshoremen’s Association (ILA) represents around 85,000 longshoremen workers across ports on the Atlantic and Gulf Coasts, Great Lakes, major US rivers, Puerto Rico, and the Bahamas. This includes some of the major ports such as New York/New Jersey, Charleston, Houston, and Savannah.
  
  • The map below shows 14 major ports along the East Coast and Gulf Coast that the ILA is affiliated with.

Potential Impacts to Supply Chain

• The East Coast and Gulf Coast ports handle roughly 50% of US imports across multiple sectors including pharmaceuticals and medical supplies.
  • Products from Europe, Latin America, India, and other countries that rely on sea freight routed across the Atlantic would be heavily impacted.
  • Lead times, fuel costs, and cargo prices are likely to increase even more, especially because many carriers are having to reroute shipments from the Suez Canal and the Red Sea attacks.
• A one-day strike could create a backlog of four to six days, and a prolonged strike may lead to port congestion that wouldn’t be resolved through late 2024 and potentially into 2025.
• The Port of Long Beach is prepared and equipped to handle cargo diversions to the West Coast port in the event that the East Coast and Gulf Coast ports strike on October 1.
  • Additionally, the Port of Los Angeles is prepared to handle any cargo diversions to the West Coast. In August, they already reported a 16% increase in volume.
• In August, when discussions around the port strikes were starting to occur, health industry partners urged hospitals and members to not panic buy because that could further exacerbate the problem or create new problems.

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