“A one-week strike could push port operations back to normal only by mid-November, while a two-week strike could extend disruptions well into 2025.”

Canadian Rail Strike Set to Begin on Thursday

North American supply chains are bracing for significant disruption as labor disputes intensify in both Canada and the United States. In Canada, the two main freight rail operators, Canadian National Railway (CN) and Canadian Pacific Kansas City (CPKC), are set to lock out union workers starting Thursday, August 22, after failed labor negotiations with the Teamsters union. Despite weekend-long talks, no agreement was reached, prompting both rail companies to initiate phased shutdowns of their Canadian networks. CN has already halted container imports from US partner railroads, while CPKC has ceased all Canada-bound shipments as from Tuesday.

Potential Strike at U.S. East Coast Ports Looms in October

Simultaneously, the US faces a looming threat of industrial action as the labor agreement between the International Longshoremen's Association (ILA) and the United States Maritime Alliance (USMX) is set to expire on 30 September. The ILA has signaled its intent to strike on the 1^st of October if no new agreement is reached. The potential strike could have a profound impact on U.S. East Coast ports, which handle an estimated 2.3 million TEUs in October alone. According to Sea-Intelligence, a Danish shipping data analysis firm, a single day of strike could create a backlog of 74,000 TEUs, taking 4-6 days to clear under current excess capacity. A one-week strike could push port operations back to normal only by mid-November, while a two-week strike could extend disruptions well into 2025.

Supply Chain Disruptions Expected

These concurrent labor disputes pose serious risks to the movement of goods across North America, with potential delays and congestion expected in both rail and port operations. Businesses and logistics providers are advised to prepare for possible delays and to explore alternative shipping routes and modes to mitigate the impact on their supply chains.

Should you have any questions or comments regarding this topic, do not hesitate to contact your Shipex representative.

The Shipex team