West Coast Port Disruption Should be 'Short and Manageable,' Says Ratings Agency
A potential strike or work slowdown affecting West Coast ports should be “short and manageable,” said credit rating agency Fitch Ratings on June 27. But if negotiations persist for too long after the June 30 expiration of the work contract between the International Longshore and Warehouse Union and the Pacific Maritime Association, then longer-term diversion of cargo to other ports and broader economic effects could occur, it said.
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If a strike does occur, it should be relatively short, said Fitch. Other port strikes have been ended by the President invoking the emergency provisions of the Taft-Hartley Act, it said. For example, in 2002 President George W. Bush ended a strike affecting 29 West Coast ports after just 10 days. “However, if operational disruptions, real or perceived, were to continue from weeks into months, some shippers may continue to use alternative ports even after the strike is over,” said Fitch. “Even now, many shippers are likely speeding up their current shipments to build inventories and planning diversions to ports in Canada such as Prince Rupert and Vancouver,” it said.