President Biden urges USMX to make ‘fair offer’ to striking dockworkers

ILA members walked out at 12:01 on 1 October as a six-year labour deal expired bringing ports along the entire US East and Gulf to a standstill for the first time since 1977.

The USMX, or United States Maritime Alliance, represents employers at container terminals on the US East Coast many of which are operated by international shipping lines, or their terminal operating subsidiaries.

“It is time for USMX to negotiate a fair contract with the longshoremen that reflects the substantial contribution they’ve been making to our economic comeback,” Biden said in a Whitehouse statement.

The President highlighted the huge profits made by container lines during the pandemic, and which have surged again this due to the impact of the Red Sea Crisis and Cape of Good Hope re-routing on supply chains.

“Ocean carriers have made record profits since the pandemic and in some cases profits grew in excess of 800 percent compared to their profits prior to the pandemic. Executive compensation has grown in line with those profits and profits have been returned to shareholders at record rates. It’s only fair that workers, who put themselves at risk during the pandemic to keep ports open, see a meaningful increase in their wages as well,” the President said,

Related:Politicians weigh in on US port strike

He also noted the key role paid by dockworkers in helping the US to recover from the impact of Hurricane Helena which left a swathe of destruction across Florida, North and South Carolina, Tennessee, Georgia, and other states when it made landfall last Thursday.

“Now is not the time for ocean carriers to refuse to negotiate a fair wage for these essential workers while raking in record profits. My Administration will be monitoring for any price gouging activity that benefits foreign ocean carriers, including those on the USMX board,” President Biden stated.

The strike comes at critical time for the Democratic party falling just five weeks before the Presidential election. Republican legislators have called on the Democrat President to invoke the Taft-Hartley Act, which would require both sides to come to the bargaining table, in an 80-day cooling off period. Biden had made it clear previously that he is not willing to do this.

The ILA walked out of formal negotiations on new master contract for dockworker labour in June in a dispute over wages and the introduction of automation by terminal operators.

Last minute negotiations on 30 September, including an improved offer from USMX, failed to avert a strike.

Major container lines including Maersk, MSC, Hapag-Lloyd, and CMA CGM have already announced labour disruption surcharges.

Related:US East Coast and Gulf dockworkers start strike paralysing ports

With unions saying they will not handle vessels diverted to the US West Coast, and little additional capacity at Mexican and Canadian ports, container vessels bound for East Coast ports are expected to drop anchor and wait out the strike.

Ocean Network Express CEO Jeremy Nixon said last week, “So, the vessels are now on their way to the East Coast will have to sit and wait until that industrial disruption is resolved.” 

Earlier this month HSBC Global Research’s latest Global Freight Monitor report noted that US Gulf and East Coast ports accounted for 57% of US imports and 8% of global container trade in 2023. A surge in volumes diverted to US West Coast ports in recent months has seen this share reduce slightly in 2024 to 55.5% of total import volume year-to-date.