How the dock workers' strike will affect food and other products

The USA The longshoremen's strike, which affected major ports from Maine to Texas, began Tuesday and posed a major threat to the supply chain that could impact Americans' ability to purchase products such as shoes, auto parts, alcohol and certain foods relate.

The strike, which International Longshoremen's Association (ILA) President Harold Daggett warned could “paralyze” the country's economy, stemmed from disputes in contract negotiations over wages and other issues between longshoremen and the United States Maritime Alliance (USMX). Thirty-six ports have suspended operations due to the strike, excluding shipping operations, which could amount to $5 billion Cost per day, according to an analysis by JP Morgan.

The actions of the union, which represents around 85,000 workers, are causing concern among officials. Numerous products across multiple industries could be affected (although workers have agreed to handle all military shipments). “We just don't know how much comes through these different ports, but it's literally trillions of dollars a year in imports and exports,” says Gregory DeYong, associate professor of operations management at Southern Illinois University. “Every day is a huge loss to the economy and potential shortages for people shopping retail.”

Fifty-three organizations representing manufacturers, farmers, retailers and more wrote a letter to President Joe Biden on Sept. 17 asking him to help facilitate negotiations. Just one day of strike results in a backlog of five days, the letter says.

New York Governor Kathy Hochul issued a statement Tuesday morning warning that the state is working diligently to ensure grocery stores and medical facilities have the products they need. “It is critical for USMX and the ILA to reach a fair agreement soon that respects workers and ensures trade flows through our ports,” she said.

Here are some of them which products are at stake in the strike.

Fruit, chocolate and alcohol

According to the American Farm Bureau, U.S. ports accepted 39.4 million tons of agricultural products in 2023, valued at more than $110 billion.

The FBI warns that the multibillion-dollar impact of the strike will be felt primarily on the East and Gulf Coasts. According to the U.S. Department of Agriculture, nine major ports account for more than 90% of all agricultural container exports on the East Coast, which can carry everything from animal feed to refrigerated meat products.

DeYong says while some manufacturers began stockpiling goods in preparation for the strike, others, particularly in the agricultural sector, were unable to do so. “The biggest thing we're going to see soon is perishable items that retailers haven't been able to stock,” he says.

Consumers should feel this According to the Farm Bureau, there are shortages and delays in bananas, three-quarters of which are transported through ILA-handled ports. Cherries, preserves, hot peppers and chocolate, all of which are heavily imported, will also be affected. “Any products that we source from South America that, even if we could put them on trains, just don't have enough capacity to bring them here on a train, will be affected,” DeYong says. He predicts There will be shortages of grapes and avocados.

Alcohol is another affected category, as the U.S. regularly imports beer, wine, whiskey, scotch and rum through affected ports, according to the Farm Bureau.

The USA could also encounter problems in the opposite case, namely when exporting products from the country. Soybean farmers and poultry producers will likely experience oversupply at home if they cannot sell their products abroad.

Shoes

The American Apparel and Footwear Association was one of them the retailers who signed a letter to Biden. The organization imports more than 50% of its U.S. apparel, footwear and accessories along the Eastern and Gulf ports, according to a September press release.

“This disruption would occur during the peak holiday shipping season and drive up commodity prices even further, leading to a rapid increase in inflation,” the statement said. “This potential shipping crisis will create a shortage of goods while making goods that are still available expensive for American families.”

The American Home Furnishings Alliance, Fashion Accessories Shippers Association, Florida Retail Federation and others also signed the letter.

Auto parts

The auto care industry also relies heavily on ports on the East and Gulf Coasts. The Auto Care Association warns that the strike would make it difficult for repair shops and dealers to meet demand for certain products and parts.

“More than four million Americans who work in the auto care industry rely on the steady flow of auto parts and products through our ports to do their jobs every day,” Bill Hanvey, president of the Auto Care Association, said in a news release. “Every day this strike continues, not only will our industry lose hundreds of millions of dollars in business, but the nearly 300 million Americans who drive will be at greater risk on the roads due to access to service and The repair of their vehicles is getting worse and worse.”

Last year, almost a quarter of all car parts were imported through the affected ports, according to the press release. While many companies have recently diverted their goods to West Coast ports in anticipation of the strike, these ports are also overwhelmed.

“Just because we get our products through a port on the West Coast doesn’t mean that’s what we actually get,” DeJoy said. “Demand is high at West Coast ports now that they are open. They don’t have the capacity to handle everything, so there will be congestion.”

Shipping costs for goods have also increased, meaning consumers will see an increase in product prices.