US: MSC Advises Shift to East and Gulf Coast Ports Amid Potential Dock Workers’ Strike

The world’s largest container shipper, MSC Mediterranean Shipping Co. SA, has advised its customers to shift their U.S. cargo operations to ports on the East and Gulf coasts in anticipation of a dock workers’ strike that could halt up to half of the country’s maritime trade volume starting Tuesday. Talks between the port workers’ union and employers may not be completed by September 30, leading to potential terminal closures from October 1. This could result in delays in shipping containers through ports from Boston to Houston.

MSC warned its customers that booking adjustments, including transfers to other ships or cancellations, may be necessary. Hapag-Lloyd AG, the world’s fifth-largest container carrier, also cautioned that industrial action would likely raise freight rates. As a result, shipping costs, including freight, storage, and loading fees, are expected to increase due to the heightened demand for alternative routes and port services.

Furthermore, a strike could cost the U.S. economy between $4.5 billion to $7.5 billion per week, according to Oxford Economics. This hit to the GDP would be reversible once the strike concludes and deliveries resume, but it would still impact retailers, manufacturers, and other importers attempting to maintain timely deliveries and adequate inventory through the fourth quarter. Despite the looming strike, a change in the U.S. economic forecast is not currently warranted, according to Grace Zwemmer of Oxford Economics.

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