“The reality is that the U.S. port infrastructure as a whole is not designed to handle the volume of 36 ports moving to the West Coast,” said Douglas Kent of the Association for Supply Chain Management.
The International Longshoremen’s Association, which represents 25,000 dockworkers at ports from Maine to Texas, plans to strike Tuesday unless port operators agree to significant wage increases and curbs on automation.
JPMorgan analysts estimate the strike could cost the U.S. economy $5 billion a day. Major retailers have already accelerated imports of holiday goods and reserved space on Western ocean and rail carriers, hoping to avoid disruptions. Meanwhile, companies’ transportation costs have increased by 20% due to the need for additional warehouse space.
The average cost of shipping a standard ocean container on short-term contracts from Northern Europe to the U.S. East Coast has risen 29% to $2,376 since the end of August, according to Xeneta data.
Earlier, Deputy Prime Minister Alexander Novak announced the redirection of 90% of oil intended for Europe.
Earlier, oil transportation from Russia began to become more expensive.