Beer Shortage Ahead? 3 Products That Will Be Most Impacted By Port Strike

The International Longshoremen's Association (ILA) initiated a strike earlier this week amid ongoing negotiations regarding wage increases and protections against automation and AI. The strike, if prolonged, could lead to supply constraints which may cause prices to rise, economists warn.

These are the sectors that could be the most impacted by the strike:

Food and Beverage: The dozen or so U.S. ports affected by the strike import nearly $100 million a month of beverages and vinegar, according to a report from the Washington Post. According to the American Farm Bureau Federation via the Washington Post, 80% of all imported beer, whiskey, scotch and more come through the ports will be impacted by the strike.

Constellation Brands STZ, the maker of Modelo, is one of the companies that imports the most beer to the U.S., although Constellation may be able to avoid disruptions caused by the port through ground transportation from Mexico. Heineken NV HEINY and other European beverage companies may feel more of the strike’s affects.

Read Also: Dockworkers Strike: Will It Impact Your Holiday Shopping?

Automotive And Car Parts: One of the most impacted sectors from the longshoremen strike is expected to be the automotive and car parts space. According to the Washington Post, the U.S. ports import more than half a billion dollars worth of cars and car parts every month.

The auto industry already saw disruptions in its supply chain earlier this year when the Francis Scott Key bridge collapsed in Baltimore, hindering shipments through one of the country's largest ports. Companies that rely on importing car parts, such as AutoZone Inc AZO and O'Reilly Automotive Inc ORLY, could also see operations disrupted by the strike.

Construction: Machinery and construction equipment account for more than $670 million in monthly imports through the dozen or so impacted ports, according to the Washington Post. Homebuilders such as DR Horton Inc DHI, Lennar Corp LEN and others could see operations delayed if the strike is prolonged.

Overall, the strike could lead to price increases and supply constraints across multiple sectors if it persists beyond a couple of weeks. In addition to the strike, flooding and storm damage from Hurricane Helene could also disrupt supply chain operations in North Carolina and other southeastern states.

Keep Reading: East Coast Dockworkers Strike: How Labor Dispute Impacts Economy, Logistics Companies

Photo: Engin Akyurt from Pixabay.