In follow up to MIQ’s Trade Alert of May 27, 2014; the PMA / ILWU the current labor contract is set to expire on July 1, 2014. No one expects a renewed contract agreement prior to July 1. It is important to note that from the beginning of the contract talks on May 12, 2014, BOTH sides have said that they are committed to reaching an agreement without any labor disruption. So unified have they been on this message, when there was a rumor that the talks had broken down on June 4, 2014 a joint press release was immediately issued reaffirming their mutual commitment to working through an agreement without any labor disruptions.
Although no one can predict with 100% certainty what will happen in the future, all signs continue to indicate any imminent strike or lockout is unlikely on the US West Coast. Small and limited disruptions (at one or two terminals, for one or two 8 hours shifts) may occur. That being said the contract talks in conjunction with other seasonal factors are currently causing congestion and delays of three to four days in LA/LB ports.
- Vacations; Many regular (Class A) ILWU members are taking their Summer vacations and the replacement workers (Class B) ILWU longshoremen are not as experienced, competent and efficient.
- May & June have seen record volumes in LA/LB and the sheer volumes shipped to arrive prior to the expiration of the contract (to avoid getting caught in any potential labor disruption) are causing equipment shortages and congestion delays.
These delays will likely grow in the next week as the National July 4th holiday and the ILWU no work holiday of July 5th (Bloody Thursday) contribute to the current delays, culminating during week #28. Most continue to believe that the ILWU / PMA will reach a formal agreement in week #29 or 30.