54 container ships waiting outside ports, shortage crisis Tentative deal includes 62% wage hike over six years – sources Strikes cost US economy $5 billion per day, JP Morgan analyst List sees shipping stocks fall across Asia and Europe
Oct 4 (Reuters) – U.S. East Coast and Gulf Coast ports announced late on Thursday after longshoremen and port operators reached a pay deal that resolves the industry’s biggest shutdown in nearly half a century. It has started to reopen, but it will take time to clear the cargo backlog.
The strike ended sooner than investors had expected, sending shipping stocks across Asia lower on Friday as higher freight rates were no longer expected.
At least 54 container ships lined up outside the port as the strike prevented unloading and threatened shortages of everything from bananas to car parts. Everstream Analytics calculated queuing numbers as of 4:00 PM ET (2000 GMT). More ships are sure to arrive.
The map shows the number of container ships stranded outside major US ports on the East Coast as of October 3.
Pricing platform Zeneta said it was likely to take two to three weeks for normal product flows to resume.
Peter Sand, chief analyst at Zeneta, told Reuters: “Don’t forget that ships continue to call at ports. We’re not just dealing with ships that are already lined up, we’re not just dealing with ships that are already lined up, we’re trying to get back to work before the supply chain restarts. “More efforts are needed to reduce congestion,” he said.
Labor unions from the International Longshoremen’s Association (ILA) and port operators from the United States Maritime Alliance (USMX) announced the agreement late Thursday. According to people familiar with the matter, the two companies have agreed to a wage increase of about 62% over six years, raising the average wage from $39 an hour to about $63 an hour.
Stock prices of shipping companies in Asia and Europe fell.
Tony Hwang, an analyst at Taishin Securities Investment Advisory, said, “Shipping stocks had previously risen on expectations for price increases triggered by strikes by U.S. longshoremen and tensions in the Middle East.” Ta.
Containers are seen stacked at the Portsmouth Marine Terminal (PMT) as longshoremen from the International Longshoremen’s Association (ILA) take part in a strike in Portsmouth, Virginia, United States, October 1, 2024. Reuters/José Luis Gonzalez/File Photo Purchase License Rights, Open in new tab In Europe, shipping group AP Moller-Maersk (MAERSKb.CO), Open in new tab, fell 7.7% to the bottom of the STOXX 600. Meanwhile, Hapag-Lloyd (HLAG.DE), Open in new tab, fell 12.4%. Switzerland’s Kuehne und Nagel (KNIN.S) fell 1.8%. Japan’s Nippon Yusen (9101.T), which hit a record high the previous day, is down 9% in new tab, and Kawasaki Kisen (9107) is down 9%. .T), Open in new tab fell 9.5%. Mitsui O.S.K. Lines (9104.T), which opened a new tab, also fell 7% on its busiest trading day in 18 months. In South Korea, HMM (011200.KS) and new tab openings also fell by 6.6%, hitting a three-week low. Ocean (028670.KS), Open in new tab, down 5.7%, Taiwan’s Evergreen Marine (2603.TW), Open in new tab, Wanhai Lines (2615.TW), Open in new tab, Yangming Marine (2609. TW), opens new tab also saw the biggest decline in recent months, falling between 8.8% and 10%. In Hong Kong, Orient Outsideversation (International) (0316.HK) was the biggest decliner on the Hang Seng Index at 8%. Drop it.
ILA launched a strike by 45,000 longshoremen on Tuesday, causing the first major shutdown since 1977 and affecting 36 ports from Maine to Texas. JPMorgan analysts estimated that the strike would cost the U.S. economy about $5 billion per day.
Retailers account for about half of all container shipments, with Walmart (WMT.N) Opens in a new tab, Ikea and Home Depot (HD.N) among the retailers that rely on East Coast and Gulf ports. Among merchants, Open in a new tab, eMarketer analyst Sky Canaves said importers relying on the affected ports include IKEA, Walmart, and Bill of Lading statistics from data firm Import Yeti. , Goodyear Tire & Rubber (GT.O) and more opens in a new tab. Some coffee destinations have seen prices soar due to the disruption at East Coast ports.
A tentative agreement on wages ended the strike, but the two countries will continue to hammer out other issues, including the use of port automation, which workers say will lead to job losses.
“The decision to end the current strike and allow ports on the East Coast and Gulf Coast to reopen is good news for the nation’s economy,” the National Retail Federation said in a statement. “The sooner we reach a (final) agreement, the better it will be for all American families.”
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Additional reporting by Jihoon Lee in Seoul, Emily Chan in Taipei, Tom Westbrook in Singapore and Stein Jacobsen in Copenhagen. Written by Peter Henderson. Editing: Sonali Paul and Barbara Lewis
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