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The National Retail Federation is projecting retail imports in May will come in at 3.5% above the level set in May of last year. But the trade group says there’s a chance labor difficulties could disrupt the flow of cargo this summer.
The current labor contract governing West Coast ports expires June 30. If labor and management can’t reach an agreement on a new contract by then, the ports could shut down. Jonathan Gold heads supply chain and customs policy for the National Retail Federation.
“We just went through this whole episode in 2012 and 2013, as the East Coast and Gulf Coast ports went through their labor negotiation, and just the threat of a supply chain disruption was enough to impact a lot of businesses, who looked to put costly contingency plans into place, to make sure their products got to either the store shelves or were exported for sale overseas,” he said.
Gold says shippers may reroute cargo to Gulf Coast ports, including Houston, if the talks don’t make sufficient progress in advance of the deadline. West Coast ports handle more than two-thirds of the nation’s cargo traffic.
The last major shutdown on the West Coast, in 2002, lasted ten days and created a backlog that lasted for weeks.
