The Looming Crisis: US Port Strike Threatens Global Shipping

A major port strike on the US east and Gulf coasts is entering its third day, threatening to disrupt global container shipping. Supply chain analysts are warning of severe congestion and capacity shortages if the strike continues.

Sea-Intelligence Consulting has issued a dire forecast, predicting that the first week of the strike alone could result in 60 vessels stranded at anchor off the US east and Gulf coasts. This would equate to a staggering 775,000 TEU of capacity tied up, a significant portion of the global container shipping fleet. If the strike persists for four weeks, nearly 7% of the global fleet could be affected, leading to widespread disruptions and delays.

Key points from the report:

  • Capacity loss: The initial week of the strike is expected to cause the highest capacity loss, followed by a more incremental decline in subsequent weeks.
  • Global impact: A prolonged strike could have a significant impact on the global supply and demand equation.
  • Spot rate increases: The strike could lead to a substantial increase in spot rates for container shipping, particularly on Asia-US routes.
  • Contagion effect: The rate increases are not limited to the affected trades but could spread to other routes due to rate contagion.

The strike has the potential to cause significant disruptions to global supply chains and drive up costs for businesses and consumers.

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