The threat of strikes, which continues to loom over port operations in major regions of the world, continues to threaten global supply chains, even with recent developments in India and Canada suggesting some relief from labour disputes.
UK forwarder Metro said the situation remains precarious, especially with the added complications from Red Sea diversions, which could magnify the impact of any further industrial action.
"Typically, strikes at ports and other supply chain hubs cause only localised disruptions. However, the current climate is fraught with uncertainty," it said, noting that as Sea-Intelligence warned, even a single day of strike action on the US East Coast could create a six-day backlog to clear containers.
"If a strike were to last a week in early October, its effects might not be fully resolved until mid-November, while a two-week strike's impact might be felt well into 2025, further straining already fragile supply chains," Metro said in a new analysis.
Metro stated that despite the threat of labour actions, there had also been recent resolutions, with the rail strike in Canada ending within a day and an averted potential nationwide strike in India involving a dozen ports there.
"The Canadian government acted within a day to end a rail strike that began on August 23, ordering Canadian Pacific Kansas City (CPKC) and Canadian National (CN) to resume operations and enter binding arbitration with the Teamsters Union," Metro said, adding that the Canada Industrial Relations Board extended expired collective agreements until new ones are finalised, temporarily safeguarding the supply chain.
However, the forwarder noted that the union has challenged this decision by filing four separate appeals with the Federal Court of Appeal, suggesting that the risk of further strike action may not be entirely averted.
"[In India], potential nationwide strike action involving 12 major ports from August 28 was avoided when the government agreed to wage increases and additional benefits for around 20,000 port workers," Metro said.
It noted that in India, union leaders insist that the strike threat played a crucial role in securing the deal, preventing significant disruption during the peak export season.
Potential strikes in Germany, the US
Despite the resolutions, ongoing threats loom, particularly regarding the US East and Gulf Coast ports and key hubs in Germany.
Metro said in Germany, the threat of strikes at major ports remains, as the trade union ver.di has rejected the latest offer from the Central Association of German Seaport Operators (ZDS).
With the contract now expired, warning strikes have already occurred in key ports such as Hamburg and Bremerhaven.
"Ver.di is pressing ZDS to return to negotiations with a more substantial offer, raising concerns about potential disruptions if an agreement is not reached soon," the UK forwarder said.
In the United States (US), the risk of strikes at East and Gulf Coast ports is growing, with the International Longshoremen’s Association (ILA) threatening action from October 1.
Due to this, container spot rates from Asia to the US have remained high, and carriers acknowledge that a strike could sustain these elevated rates through the end of the year.
"The early peak season, driven by shippers eager to front-load holiday goods, has already caused concerns about overcapacity. A strike could exacerbate these issues, leaving carriers with limited options to mitigate the impact," Metro said.
It noted that as negotiations remain tense and the risk of disruptions continues to grow, businesses and supply chain managers should stay vigilant and proactive in their planning.
"Unresolved labour disputes could have significant consequences for global trade, particularly as the year-end approaches," the UK forwarder further said.
