Date: Friday, July 14, 2023
After being shuttered for 13 days, the key container shipping ports of Vancouver and Prince Rupert in British Columbia, Canada, will open “as soon as possible” after a new labor deal was reached, the British Columbia Maritime Employers Association (BCMEA) announced Thursday.
The tentative agreement has a four-year term and is subject to ratification by both parties. No details were disclosed. The announcement of the end of the port labor impasse came after a federal mediator delivered recommendations to both sides with a tight deadline to respond.
Impact on US imports
The near-two-week strike led to a virtual shutdown of containerized rail moves from Vancouver and Prince Rupert to the U.S. Even though the British Columbia ports will reopen soon, the effect on the flow of U.S. imports via the Canadian gateways will linger. Canadian railway CN told FreightWaves that disruptions could take weeks or even months to correct.
Data from FreightWaves SONAR that tracks rail moves of loaded international containers from Vancouver and Prince Rupert shows a near-total collapse in volumes as a result of the strike.
That said, the two Canadian ports’ contribution to total U.S. imports is relatively small, so the strike’s effect on the U.S. was much less significant than on Canada.
Jonathan Gold, vice president for supply chain for the National Retail Federation, said on July 7 that the strike “shouldn’t have a major impact here but could affect some U.S. retailers whose merchandise comes in through Canada.”
Ship-position data from MarineTraffic shows that as of Thursday afternoon, there were eight container ships waiting to be served by the Port of Vancouver and four container ships in the queue off Prince Rupert, roughly the same number that were waiting on Sunday.
West Coast labor disruptions end
The announcement of a labor agreement in Canada draws to a close a protracted period of labor unrest along the Pacific coast of North America, in once case, involving International Longshore and Warehouse Union (ILWU) Canada conducting an strike that began July 1, and in the other, involving the U.S. branch of the ILWU slowing port operations as negotiations dragged on.
The labor unrest had threatened a new flare-up for U.S. supply chain issues following the much more extreme disruptions seen in the COVID era. That threat is now gone.
The U.S. ILWU and terminal employers announced a tentative agreement on June 14. During a press conference Wednesday, Port of Los Angeles Executive Director Gene Seroka outlined the timetable for ratification of the U.S. ports deal.
“The ILWU will proceed with a democratic process involving a delegate caucus that represents all 29 [U.S.] West Coast ports later this month,” said Seroka. “These delegates will review the contract and determine whether to present it to a vote among the rank and file. Historically, it has taken about three months from the time a tentative agreement is reached until a full membership ratification happens.”