West Coast longshore labor negotiations have taken a bad turn, with the Southern California local of the ILWU withholding labor last week, thus shutting down terminals across the ports of Los Angeles and Long Beach, as noted in a LinkedIn post by Peter Tirschwell, VP of S&P Global Market Intelligence.

“This week, it began "red tagging" equipment for maintenance at automated facilities and, according to the Pacific Maritime Association, delayed the dispatch process,” Tirschwell wrote.

The executive also noted that the resulting disruption caused the reappearance of a backup vessel for the first time since November.

Labor negotiations have halted operations in one of the most important ports in the U.S., which is also a key point in the Pacific route, as unions continue to push for improved working conditions and pay raises.

The constant stoppages have turned the port of LA/LB into a “less reliable option”, which has caused cargo owners to divert their ships to the Gulf of Mexico and the Atlantic coast.

While this alternative means longer transit times and even higher costs, it does guarantee arrival times.

WCSA route could be compromised

Most of the cargo destined for the South Pacific coasts comes on the same ships that call at LA/LB. 

Therefore, if the disruptions at that port are prolonged, they will affect the flow of cargo on the WCSA route.

With the one-year anniversary of negotiations quickly approaching on May 10th, the disruption at the Port of LA/LB has reached a crucial period, with transpacific contract negotiations coming up for renewal on May 1st.