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ICIS: US ports extending gate hours following strike

by The Editorial Team
October 7, 2024
in Shipping
container ship

Credit: Shutterstock

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The Independent Commodity Intelligence Services (ICIS) provides an overview of the situation of US ports, following the strike of dockworkers that paralyzed ports across the country. 

According to ICIS, with the suspension of the strike at US Gulf and East Coast ports until 15 January, carriers are urging customers to use extended gate times being offered by some ports to collect or deliver any urgent containers to terminals. The International Longshoremen’s Association (ILA) and the United States Maritime Alliance (USMX) reached a tentative agreement on wages late Thursday (3 October) and will extend the current contract while they continue to negotiate other outstanding issues. Thus ICIS provides the following analysis on the situation: 

Analysts at freight forwarder Flexport said the relatively short duration of the ILA strike means that the impact on the broader US economy has been limited.

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If the strike had continued into next week, the ripple effects could have been massive. While the broader economic impact has been averted, the strike has made an immediate impact on the ocean and air markets.

… Flexport said. 

The company said that during the strike, bookings to the US East Coast remained open, and they expect them to stay open. The only limitations were rail routings to the East Coast via Los Angeles, but Flexport expects they will soon resume operations as well.

Early reports indicated that each day of the strike would have added five to 10 days of port congestion. If you have urgent cargo, routing via the West Coast on rail or transloading in Los Angeles remains your best option to avoid potential congestion on the East Coast.

… Flexport noted.

Container rates fall further, pace slows

Global average rates for shipping containers fell by 5% this week, according to supply chain advisors Drewry, as shown in the following chart.

container strike us ports
Credit: ICIS

But rates from east Asia and China to the US fell at a slower rate, as shown in the following chart.

ICIS: US ports extending gate hours following strikeRates to the West Coast fell by 4.23%, while rates to the East Coast fell by 1.76%.

Drewry was anticipating rates to the US would rise because of the strike. But with the strike paused, and because peak season demand was largely pulled forward, it is likely that rates will continue to see downward pressure.

Container ships and costs for shipping containers are relevant to the chemical industry because while most chemicals are liquids and are shipped in tankers, container ships transport polymers, such as polyethylene (PE) and polypropylene (PP), which are shipped in pellets.

They also transport liquid chemicals in isotanks.

Liquid chem rates stable to softer

The US chemical tanker market was largely stable week over week, with slight decreases seen from the US Gulf to Asia for smaller parcels. Most market participants were preparing to attend the European Petrochemical Association (EPCA) conference in Berlin, so the market was quiet, ICIS concludes. 

ICIS: US ports extending gate hours following strikeICIS: US ports extending gate hours following strike
ICIS: US ports extending gate hours following strikeICIS: US ports extending gate hours following strike
Tags: containershipsshipping marketUS ports
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