US ports avoid crisis with tentative ILA/USMX agreement

A potentially crippling strike across East and Gulf Coast ports, set to begin on 16th January 2025, has been averted with the announcement of a tentative six-year master contract agreement between the International Longshoremen’s Association (ILA) and the United States Maritime Alliance (USMX) on 8th January.

However, the agreement is not yet a done deal. It must be ratified by the ILA’s local wage-scale committees, leaving supply chains vulnerable to ongoing uncertainty that could stretch into the summer of 2025.

The roots of the dispute go back to October 2024, when dockworkers staged a three-day strike over issues of wages and automation. While the strike ended with an agreement on wage increases and a temporary extension of the existing contract, tensions simmered over automation, which the ILA argued could threaten jobs. Talks resumed on 7th January 2025 in New Jersey, culminating in an agreement just days before the strike deadline.

A pivotal moment in the negotiations came on 20th December 2024, when President-elect Donald Trump met with ILA President Harold Daggett in Florida. Trump expressed open support for the union’s anti-automation stance, stating that foreign-owned carriers should invest in American dockworkers rather than fully automated systems. His intervention reportedly added significant pressure on carriers, leading to a compromise in the tentative deal. The agreement allows for limited semi-automation while guaranteeing union jobs tied to new technologies.

Although the immediate strike threat has passed, the risk of disruption remains. The ratification process is expected to take months, and uncertainty will continue to impact supply chains.

Metro has implemented contingency measures to mitigate the impact of potential labour unrest. These include diverting cargo to West Coast ports, Canadian trans-loading and expanding air freight options. These solutions remain critical as the ratification process unfolds.

At the same time, we are urging carriers to lift surcharges such as “Work Disruption” and “Port Congestion” fees, which have added financial strain to supply chains since October 2024.

The threat of renewed disruption is likely to persist until the agreement is ratified. Metro strongly advises shippers to remain vigilant, flexible, and prepared to adapt their logistics strategies in the months ahead.

With uncertainties lingering, Metro’s proactive solutions are essential to maintaining a resilient and adaptable supply chain. Our expert team continuously monitors developments, offering strategic guidance to help you optimise routes, avoid disruption, and manage costs effectively.

EMAIL our Managing Director, Andrew Smith, to discover how Metro can protect and future-proof your North American supply chain.