(Bloomberg) --
Leaders from a US dockworkers’ union and the group that represents their employers are set to resume contract talks on Jan. 7 as the threat of a strike looms, according to a person familiar with the negotiations.
Facing a mid-January deadline to reach a deal, Tuesday’s planned talks are a welcome sign for importers and exporters bracing for a labor disruption that would shut every major port on the US East and Gulf coasts. Those gateways account for roughly half of all the country’s container volumes, according to data compiled by the American Association of Port Authorities.
But the issue of whether employers will be allowed to add semi-automated machines to port terminals under the next labor contract may once again prove difficult to resolve.
In early October, the International Longshoremen’s Association reached a tentative deal with ocean carriers and terminal operators on a 62% wage increase over six years, suspending a three-day strike but leaving the technology issue unresolved.
“Let’s hope the parties can actually get a deal. If not, they must do another extension to avoid a strike,” Jonathan Gold, vice president of supply chain and customs policy at the National Retail Federation, wrote in a post Wednesday on X, the social-media site formerly known as Twitter.
The resumption of talks was reported earlier this week by the Journal of Commerce.
December Stalemate
After meeting for just two days in November, the ILA and the US Maritime Alliance, or USMX, declared an impasse over the use of semi-automated, rail-mounted gantry cranes at port terminals, threatening another stoppage when the temporary extension expires on Jan. 15.
Such equipment is permitted in the current contract and is already in use at some ILA-operated terminals, but union President Harold Daggett has said he won’t accept a contract that allows for any degree of automation, which he sees as a threat to dockworker jobs.
President-elect Donald Trump, whose inauguration is set for Jan. 20, has voiced his support for dockworkers in their fight against automated machinery.
The USMX maintains the technology at issue does not harm longshore employment, and such modernization is necessary to keep US ports — and the broader economy — competitive.
Copenhagen-based A.P. Moller-Maersk A/S, the world’s No. 2 container carrier, said in an advisory earlier this week that “we strongly encourage our customers to pick up their laden containers and return empty containers at US East and Gulf Coast ports before Jan. 15.”
Meanwhile, spot container rates are climbing on concerns about trade disruptions in the US.
Drewry, a supply chain advisory firm, said Thursday it expects short-term rates on transpacific trade lanes “to rise in the coming week, driven by front-loading ahead of the looming ILA port strike in January 2025 and the anticipated tariff hikes under the incoming Trump administration.”
--With assistance from Sophie Caronello.
(Adds Maersk, shipping rate details in final three paragraphs. A previous version removed an incorrect date from the map)
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