A U.S. port strike looms, and it would be ‘devastating’ for supply chains

Roughly 45,000 dockworkers at three dozen seaports from Texas to Maine have threatened to walk off the job on Oct. 1 if they don't reach a new contract agreement.

Hot on the heels of a Canada-wide rail shutdown, a potential strike at U.S. seaports on the East Coast and Gulf of Mexico is threatening to further disrupt supply chains.

The International Longshoremen’s Association (ILA), which represents roughly 45,000 dockworkers at three dozen seaports from Texas to Maine, have threatened to walk off the job on Oct. 1 if they don’t reach an agreement on a new contract with the United States Maritime Alliance (USMX) of shipping companies.

A work stoppage at the ports could back up cargo there for weeks or even months, experts warn, with implications far beyond the U.S.

“An East Coast port strike would be absolutely devastating to our supply chains in North America,” said Fraser Johnson, a professor at Western University’s Ivey Business School who studies supply chain management.

A large amount of imports to Canada come in through American ports, which on the east coast are able to handle far more capacity than the Port of Halifax and Port of Montreal, the main Canadian shipping points on the Atlantic.

The Port of New York and New Jersey, the largest East Coast port, ships about US$300 billion worth of goods annually and moved 7.8 million 20-foot equivalent units (TEU) last year. By comparison, the Port of Montreal saw 1.5 million TEUs in 2023, and the Port of Halifax handled just over 546,000.

An economic study by Martin Associates last year estimated the annual value of goods handled at the Port of Montreal to be $151.2 billion, while the Port of Halifax does not calculate those dollar values.

Both ports would struggle to take in even a fraction of the goods that would normally enter through the U.S. on top of its regular cargo traffic, Johnson said.