by NORFOLK, Va. — Uncertainties persist industrywide as the year comes to a close. January is likely to bring a variety of new challenges, beginning with a potential International Longshoremen’s Association labor strike that would close all U.S. East and Gulf Coast ports once again. There have been no positive labor negotiation developments in recent weeks, and it appears the ILA is preparing for a work stoppage effective Jan. 15.
The main sticking point is automation, and neither side seems ready to compromise on this critical issue. There is no clear indication of how long a labor strike would last, as it depends on further negotiations, potential presidential action, etc., but many believe the duration could be longer than the three-day strike in October.
Jan. 20 will bring the U.S. presidential inauguration and more uncertainty around action related to a strike (if it occurs) and threatened tariffs on major U.S. trading partners, as well as potential retaliatory tariffs on U.S. exports. It is still unclear whether significant tariff changes will materialize, or if they are simply a starting point for negotiations.
Jan. 29 is the start of the Lunar New Year holiday. Most Asia operations will close for at least a few days; China factories and offices will close for about a week, some longer. The holiday is typically preceded by a surge in import volume to the U.S. ahead of the closures. If imports increase for the holiday, as well as front-loading of cargoes ahead of the potential strike and increased tariffs, freight rate increases will follow and space will be tight, particularly to U.S. West Coast ports.
The new ocean alliances will also take effect in the first quarter of 2025. U.S. regulatory approval for the Premier Alliance, comprised of remaining members of THE Alliance, has been delayed while the Federal Maritime Commission gathers additional information; it’s widely expected that the refreshed alliance will ultimately be approved. Combined with the new Gemini Cooperation and the end of the 2M alliance, expect plenty of service and schedule changes, as well as blank sailings.
In India, we are watching a potential port labor strike that would begin as of Dec. 17, a continuation of disagreements from a threatened strike this past August.
As always, forecasting and early booking are critical for those wanting to stay ahead of the curve as it relates to these and other logistics related challenges.
Rachel Shames is vice president, pricing and procurement at logistics services firm CV International.
As I have said numerous times concerning the containers coming in from China and Vietnam, it’s a total shame that the American furniture industry is constantly being held HOSTAGE by the container shippers for the past 4 years. When they got away with rates of up to $20,000 and more per container others followed as well. Such is the case with the anticipation of this so called bogus strike coming up. The American furniture manufacturers need to bring back the good old days of making furniture here in USA. They made more money back then as well as furniture retailers. Until this happens it will continue to get worse.