After days of labour disruptions, the International Longshoremen’s Association (ILA) and the United States Maritime Alliance (USMX) have reached a tentative wage agreement, effectively ending the strike that began on October 1, 2024. The agreement was reached late on Thursday, October 3, bringing relief to shippers and logistics providers who have been facing significant delays and backlogs at U.S. East and Gulf Coast ports.
Overview of the Tentative Agreement
The tentative agreement between the ILA and USMX temporarily resolves the labour dispute and extends the Master Contract until January 15, 2025. This extension provides a crucial window for both parties to continue negotiating a long-term solution. While the strike has officially ended, the situation remains fluid, with further discussions set to take place in the coming months. The next round of negotiations is scheduled to resume in early January 2025.
Resumption of Operations Across Ports
Operations have resumed at 36 ports along the U.S. East and Gulf Coasts. While most ports have begun operating as of Friday, October 4, some ports will not be fully functional until Saturday, October 5. Terminal operators are working around the clock to clear the backlog of vessels that have been anchored or drifting due to the strike.
With the strike now over, the “force majeure” declarations issued by several carriers and logistics providers may be lifted or adjusted. Shippers are advised to keep an eye on updates from their carriers regarding any remaining restrictions or surcharges that were imposed during the strike period.
Impact on Free Time, Detention and Demurrage
During the strike, allowable free detention and demurrage time was temporarily frozen for affected shipments. Now that operations have resumed, these timelines have been reactivated. This means that the clock is once again ticking for containers sitting at terminals that are operating at normal capacity. Customers are strongly encouraged to arrange for container pick-ups or returns as soon as possible to avoid additional charges.
Ports and carriers are expected to enforce standard detention and demurrage fees, and with the backlog of containers waiting to be moved, delays and congestion could still pose challenges in the coming weeks. Airmark will continue to monitor this situation closely and provide updates on any changes to detention and demurrage policies.
Backlog and Congestion Concerns
Although the strike has ended, it is anticipated that it will take several weeks to clear the backlog of cargo at affected ports. Many vessels that were delayed or rerouted during the strike period are now returning to port, leading to congestion at terminals and increased wait times for berthing. Trucking and rail services may also face challenges as the surge in cargo arrivals puts additional pressure on intermodal networks.
Carriers are currently reviewing the situation to determine whether additional congestion and operational disruption charges will continue to be enforced. We will also continue to keep customers updated on any changes to these charges as the ports work to restore normal operations.
What Does This Mean for Shippers?
With the strike now resolved, the focus shifts to clearing backlogged shipments and normalising operations. Here are some key considerations for shippers in the coming weeks:
- Plan for delays: It will take time for ports and carriers to clear the backlog and restore normal service levels. Expect longer processing times for cargo currently at port or en route.
- Monitor free time limits: With the reactivation of free time, detention and demurrage charges, shippers need to be proactive in managing pick-ups and returns. Avoid unnecessary fees by staying on top of container movements and coordinating with your logistics provider.
- Stay informed on charges: Additional surcharges, such as congestion and operational disruption fees, may still apply. Stay in close communication with your carriers and logistics partners to understand any ongoing charges and adjust your shipping plans accordingly.
- Evaluate alternative solutions: If delays persist or additional surcharges remain in place, consider exploring alternative routes, ports or transportation methods to minimise disruption and maintain supply chain continuity.
How Airmark Can Support You
We are committed to helping our partners and customers manage the complexities of port operations and supply chain disruptions. Our team is actively working with carriers and terminal operators to prioritise the movement of your cargo and mitigate delays. If you have any questions or need assistance in managing your shipments during this transition, please reach out to your Airmark representative.
For the latest updates and insights, stay tuned to our communications and reach out with any concerns or queries.
