ILA Strike at US Ports: Impact on Supply Chains and Freight Rates

The International Longshoremen’s Association (ILA) has initiated strike action at U.S. ports from Maine to Texas, accusing ocean container carriers of overcharging customers. The ILA claims that carriers are now charging $30,000 per container, a significant increase from $6,000 just a few weeks ago. However, data from Xeneta shows that average spot rates on major trade routes are much lower, with rates around $7,000 per FEU from the Far East to the U.S. East Coast and $2,800 per FEU from North Europe to the U.S. East Coast.

Peter Sand, Xeneta Chief Analyst, criticized the ILA for spreading misinformation and urged for a diplomatic resolution to the situation. He emphasized the potential impact of the strike on supply chains and the U.S. economy, as more than 40% of containerized goods enter the U.S. through the East and Gulf Coast. Sand also highlighted the need for accurate information to prevent panic in the market and avoid spiraling freight rates.

Sand reiterated the importance of Government intervention to end the dispute between the ILA and ocean container carriers. He expressed concern over the potential long-term damage to the economy and ocean supply chains if the strike continues without resolution. Sand emphasized the need for swift action to prevent further harm to the economy and ensure a timely recovery of supply chains.

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