Supply chain uncertainty persists amid US and Canadian labour disputes

Labour disputes on the US East Coast and at the Port of Montreal are causing significant uncertainty for supply chains across North America. While some relief has been secured through temporary agreements, the threat of further disruption looms as key issues remain unresolved.

On the US East Coast, a temporary agreement between the International Longshoremen’s Association (ILA) and the United States Maritime Alliance (USMX) has brought a brief period of stability. However, the three-month extension to negotiations, due to expire on 15 January 2025, leaves the unresolved issue of automation hanging over the industry. The wage increases of over 60% are a step forward, but automation continues to be a point of contention, posing the risk of renewed strikes early next year. This situation could coincide with the busy Chinese New Year shipping season, potentially leading to significant delays.

Ports have been working tirelessly to clear the backlog caused by the earlier strikes, aided by additional capacity from shippers front-loading cargo and diverting shipments to alternative ports. Some have extended operational hours to accommodate delayed vessels, aiming to minimise disruptions ahead of the holiday season. 

However, while some carriers have suspended their Emergency Operations Surcharges on the USEC, several have announced peak season surcharge (PSS) hikes. Maersk, CMA CGM, and MSC are introducing increased surcharges of up to 15% from Europe, the Mediterranean, and other regions to North America.

Meanwhile, the Port of Montreal is facing its own set of challenges, with an ongoing overtime strike launched by longshoremen on 10 October. The strike, organised by CUPE Local 357, follows earlier strike actions that halted operations at two terminals. In response, Canada’s federal Minister of Labour, has proposed the appointment of a special mediator to help resolve the dispute, which would bring a 90-day pause to the overtime strike.

To discuss how we can help secure your supply chain against potential delays, please EMAIL our managing director, Colin Redman.