From shoes to alcohol, these products will be affected by the dockers’ strike

Longshoremen strike in front of the Port of Houston Authority on October 1, 2024 in Houston, Texas. Source: Brandon Bell/Getty Images

TThe U.S. longshoremen’s strike, which has affected major ports from Maine to Texas, began Tuesday, posing a serious supply chain threat that could impact Americans’ ability to source products including shoes, auto parts, alcohol and some food products .

The strike, which International Longshoremen’s Association (ILA) president Harold Daggett warned could “cripple” the country’s economy, arose from negotiation disputes over wages and other issues between longshoremen and the United States Maritime Alliance (USMX). According to JP Morgan’s analysis, as a result of the strike, thirty-six ports stopped working, preventing shipping operations whose daily cost could reach USD 5 billion.

The actions of the trade union, which represents about 85,000 workers, have raised concerns among officials. Many products across many industries may be affected (although employees have agreed to process any military shipments). “We just don’t realize how much cargo flows through these different ports, but it’s literally trillions of dollars a year in both imports and exports,” says Gregory DeYong, associate professor of operations management at Southern Illinois University. “Every day is a huge loss to the economy and potential shortages for people who shop at retail stores.”

On September 17, fifty-three organizations representing manufacturers, farmers, retailers and more wrote a letter to President Joe Biden urging him to help facilitate negotiations. The letter said that just one day of strike would result in a five-day arrears.

New York Gov. Kathy Hochul issued a statement Tuesday morning warning that the state is working diligently to provide grocery stores and medical facilities with the products they need. Experts say that while the effects of the strike will be felt across the country, the disruption to the goods supply chain did not occur unexpectedly in the way that occurred during the Covid-19 pandemic. “These port strikes are disruptions that sounded a warning,” says Rutgers Business School professor Arash Azadegan. “This allows organizations to be better prepared.”

Here are some of the products affected by the strike.

Fruit, chocolate and alcohol

According to the American Farm Bureau, in 2023, U.S. ports received 39.4 million tons of agricultural products worth over $110 billion.

The bureau warns that the billion-dollar impact of the strike will be felt especially on the eastern and Persian Gulf coasts. According to the U.S. Department of Agriculture, nine major ports account for more than 90% of all East Coast containerized agricultural exports, which can carry everything from animal feed to refrigerated meat products.

DeYong says that while some manufacturers began stockpiling goods in preparation for the strike, others, particularly in the agricultural sector, were unable to do so. “The main things we’ll start to see early on are perishable products that retailers haven’t been able to stock,” he says.

According to Farm Bureau, consumers will likely experience shortages and delays in banana shipments, three-quarters of which pass through ILA-served ports. Cherries, canned foods, hot peppers and chocolate, which are largely imported, will also be affected. “All the products we get from South America, and even if we could put them on trains, they wouldn’t have enough capacity to transport them by train to get here (it will have an impact),” DeYong says. He predicts there will be a shortage of grapes and avocados.

Alcohol is another category affected because the United States regularly imports beer, wine, whiskey, scotch and rum into affected ports, according to the Farm Bureau.

The United States may also experience problems in the opposite situation: exporting products from the country. Soybean farmers and poultry producers will likely experience domestic oversupply if they are unable to sell their products abroad.

Shoes

The American Apparel and Footwear Association was one of the retailers that signed the letter to Biden. The organization imports more than 50% of its U.S. clothing, footwear and accessories to Eastern and Gulf ports, according to a September press release.

“This disruption would occur during the peak holiday shipping season and would cause commodity prices to rise even further, causing inflation to soar,” the statement said. “This potential shipping crisis will create a shortage of goods, while goods that are still available will be costly to American families.”

The American Home Furnishings Alliance, Fashion Accessories Shippers Association, Florida Retail Federation and other organizations also signed the letter.

Car parts

The auto industry also relies heavily on ports on the East Coast and the Gulf Coast. The Auto Care Association warns that the strike will make it more difficult for repair shops and distributors to meet demand for some products and parts.

“More than four million Americans who work in the auto industry rely on the steady flow of auto parts and products through our ports every day to do their jobs,” said Bill Hanvey, president of the Auto Care Association, in a news release. “Not only is our industry losing hundreds of millions of dollars in business each day this strike continues, but the nearly 300 million Americans who drive are at greater risk on the road as access to service and repairs for their vehicles decreases. “

According to the press release, almost a quarter of all auto parts were imported through affected ports last year. Although many companies have recently redirected their goods to West Coast ports in anticipation of the strike, these ports are also congested.

“Just because we ship our products through a West Coast port doesn’t mean we’ll actually receive them,” DeYong says. “Demand is high at West Coast ports right now because they are open. They can’t handle everything, so there will be congestion.”

The costs of transporting goods have also increased, which means that consumers will see product prices increase.

Electronics

The United States is keen on sourcing electronics from Asian countries, including China, which regularly ships microchips. This relationship, Azadegan argues, means people may experience shortages of certain electronic devices, such as cell phones.

Medical supplies

Experts say people shouldn’t stress about the strike’s impact on medical supplies. Unlike other goods, these products or prescriptions can often be shipped via alternative routes, such as by air. “Yes, it will cost more. Yes, supply and logistics managers may feel more pain and anguish, but ultimately I think most hospitals, most clinics and healthcare institutions are willing to pay a little more for supplies,” says Azadegan.

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