Southern California ports see jump in imports as strike looms for Gulf and East Coast

LOS ANGELES (CN) — The ports of Los Angeles and Long Beach reported a big jump in imports as they recover market share from the Gulf Coast and East Coast ports, where dockworkers are threatening to strike if they don’t have a new contract by the end of September.

Port of LA executive director Gene Seroka said at a media briefing Wednesday that imports rose 18% in August from a year ago to 509,363 twenty-foot-equivalent units, or TEUs, the measurement used in ocean shipping where electronics, furniture, clothes and other imports from Asia are typically transported in 40-foot containers.

“This elevated volume, some of which is typically headed to other gateways, has been coming our way for several reasons,” Seroka said. “Extended labor negotiations at East and Gulf Coast ports have prompted importers to reallocate some of their cargo out west.”

At the adjacent Port of Long Beach, imports increased 40% from August 2023 to 456,868 TEUs.

The jump in imports made August the strongest month in the port’s 113-year history, Long Beach said, as retailers moved cargo ahead of potential tariff increases and labor negotiations continued at seaports on the East and Gulf coasts.

“Cargo diversions and concerns about upcoming tariffs are creating a busy peak season for us,” Port of Long Beach CEO Mario Cordero said last week. “We’re prepared for the uptick in shipments and continued growth through the rest of the year with a dedicated waterfront workforce, modern infrastructure and plenty of capacity across our terminals.”

The large uptick in imports at the two Southern California container ports, which together handle the bulk of imports from Asia, reverses the situation from two years ago when U.S. retailers and other importers started to avoid the West Coast because of the protracted labor talks between the terminal operators and the longshore union.

At the time, there was a growing concern that a standoff with the union could lead to walkouts or slowdowns at the ports, leaving millions of dollars in cargo stuck at sea.

Now, importers face the threat of a strike at the Gulf and East Coast ports, including New York-New Jersey, Savannah, Georgia, Norfolk, Virginia, and Houston, where the current contract with 45,000 dockworkers expires Sept. 30.

The Wall Street Journal reported this month that the International Longshoremen’s Association is seeking a 77% raise for its members over six years, compared to the 32% increase West Coast dockworkers negotiated last year, and is ready to strike if there’s no deal by Oct. 1.

The prospect shutdown of the East and Gulf coast ports, which is likely to create a supply chain disruption not unlike that at the height of the Covid-19 pandemic, may prompt the Biden administration to step in.

“I know the administration is watching this very closely and like always engaging with principals to try to make sure folks stay at the table and keep talking,” Seroka said. “This has been a long time coming to make sure our workforce is paid appropriately coming off of all the work during the Covid surge.”

The port executive added that Los Angeles could handle a further influx in cargo should more imports be shifted to the West Coast, saying that the port is now operating at 80% of its capacity.

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