Shippers hesitate to send cargo to West Coast ports over ongoing labor negotiations
Dockworkers and West Coast ports are still deliberating over proposed contract agreements, and many shippers are getting antsy. While the labor negotiations continue in San Francisco, cargo volumes at the Port of Los Angeles have dropped off pre-peak season as shippers divert traffic to ports on the Gulf and East coasts. Port of Los Angeles Executive Director Gene Seroka pointed out the decline in a Wednesday press briefing, noting that September 2022 volume was down 21.5% from the previous year.
While the potential of port disruptions due to labor strikes is always a possibility, falling consumer demand is also a reason that companies have decided to cut back on purchase orders compared to last year. According to Global Port Tracker and the National Retail Federation and Hackett Associates, retail imports are forecasted to be almost 10% lower year-over-year.
Shipping a 40-foot container from Shanghai to New York now costs nearly $10,000, causing frustration among importers and talk of a market bubble.