According to a report from CNBC, the International Longshoremen's Association and the U.S. Maritime Alliance (USMX) met secretly on Sunday to discuss the issue of technology and automation ahead of formal contract bargaining.
The Details: The CNBC report said the ILA and USMX met for eight hours and produced language on automation to expedite the full bargaining committee review process scheduled for Tuesday.
CNBC said it reviewed the document which allows the ILA the right to add union workers to complement any new technologies and "there is a commitment by the parties to research and utilize all technology that would assist an operator in being more efficient and productive."
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However, sources said that the language that was drawn up may add to concerns about labor costs and could complicate a contract deal that includes wage increases and protections from automation.
The current, temporary labor contract signed in October is set to expire on Jan. 15.
Harold Daggett, president of the International Longshoreman’s Association, previously hinted at another potential strike in a Christmas Day message to union members.
“Our resolve may be tested again in mid-January as we face another deadline for negotiating a new Master Contract by January 15, 2025. We want to avoid another strike, and hope that our employers represented by United States Maritime Alliance will respect our demands for a fair and decent contract,” Daggett wrote.
Why It Matters: If the ILA port workers strike, the work stoppage could affect many industries.
Shipping companies, like ZIM Integrated Shipping Services Ltd. ZIM and Global Ship Lease Inc. GSL could face significant loss of revenue in the event of a port strike.
Investors can monitor the effects on the broader shipping industry through the SonicShares Global Shipping ETF BOAT which tracks the Solactive Global Shipping Index consisting of global shipping companies engaged in maritime transportation of goods and raw materials.
Some companies that could benefit from a port strike include logistics providers such as C.H. Robinson Worldwide, Inc. CHRW which has a focus on freight brokerage and primarily truck and rail brokerage.
Ground and air freight shipping companies like FedEx Corp. FDX and United Parcel Service, Inc. UPS could also benefit in the event of a port strike as businesses would shift toward ground and air transportation of goods.
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