Read also: C.H. Robinson: How Shippers can prepare for a Potential ILA Strike Amid an Increasingly Disrupted North American Shipping Landscape 

Port Strike Impacts on Specific Industries: Pharmaceutical and Healthcare

1. The looming U.S. port strikes put most categories of goods at risk as east and gulf coast ports process nearly half of the country’s cargo. General retail goods may be the only category not as affected by a short or medium-term strike action, as many importers anticipated that the strike would move forward, and moved up the typical seasonal peak shipping season from September to August to stock inventories for holiday spending upticks.

2. Most companies have about 3-4 weeks’ worth of inventory, risking a disruption to supply should the impacts of the strike continue beyond that time frame.

3. In addition to the automotive and agri-food industries, the pharmaceutical and healthcare sector which relies on a time-sensitive supply chain may see the biggest impacts and potential material shortages that could disrupt production or patient safety. 

• The affected ports handle more than 91% of containerized imports and 69% of containerized exports of U.S. pharmaceutical products.
• Over 1 in 3 containers departing the U.S. with lifesaving medications leaves from the Port of Norfolk, VA.
• Nearly 30% of containerized pharmaceutical imports in the U.S. enter through the Port of Charleston, SC.
• If port strikes occur, this will lead to a spike in airfreight activity for time-sensitive supply chains such as pharmaceutical and could lead to capacity shortages for lower-value goods.

And below is some additional insight from Jena Santoro, Senior Manager of Intelligence Solutions at Everstream Analytics.

How long would a port strike take to impact the prices of goods? 

“Some estimates say that a coordinated port strike would take roughly four weeks to reach consumer level as many companies have adequate inventories to support orders in the interim. As peak holiday shipping season occurred early this year – in part due to anticipated disruptions from this strike action – most retail goods have already been imported to fulfill those orders and stockpiles are high. For other categories of goods, a strike duration beyond one month or so could be devastating. Some manufacturers could run short of parts, notably in the auto and pharmaceutical industries, which generally don’t stock large parts inventories. Each strike day could lead to a 4-6-day backlog in cargo processing which could end up causing shortages in deliveries and inventory even beyond the actual duration of the strike action.”

 Are stores already hiking prices in anticipation? Are there any particular goods that could be impacted? 

“Based on our intelligence, there haven’t been any reports of price hikes at the retail level in anticipation of the strikes. However, a variety of goods are expected to see impacts in the event of strike action, even if it ends up being a partial strike like a work-to-rule order. This includes fruit imports like bananas given the significance of the Port of Wilmington, Delaware for companies like Dole Fresh Fruit Company and Chiquita Fresh North America and meat exports as 45% of waterborne US pork exports and 30% of US beef exports are shipped via East and Gulf Coast ports. As the affected ports handle about half of the nation’s cargo shipments, disruptions would extend to most categories of goods, including automotive and electronics shipments, other perishables like medicine and pharmaceuticals, and general retail goods.”

As part of the current government and Democratic nominee, could the strikes spell any election trouble for Kamala Harris?

“Harris has not made public her intentions for intervention in case of a prolonged strike action should she be elected. President Biden has made clear that his administration would not intervene but instead would encourage continued dialogue and negotiation between the affected parties. It is currently unclear if Kamala Harris has that same stance, and without knowing her position, it is difficult to discern any potential implications to her election.”