Economic losses could be severe from industrial action threatened in October at 36 American ports, from New York to Houston.
A potential strike at ports across the US East Coast in early October could deliver a $63bn knock to the US economy, according to analysis by Russell Group, a data and analytics company.
This analysis was based on a two-week strike from 1 October to the 15 October, across leading US ports along the East Coast from New York to Houston, as calculated by Russell’s ALPS Marine exposure solution.
If talks fail, beyond the deadline of the 30 September between the International Longshoreman Union and the United States Maritime Alliance (USMX), there would be a strike at 36 ports including Boston, New York, New Jersey, Philadelphia, Houston, Tampa, Baltimore, New Orleans and the Port of South Louisiana.
Russell said its ALPS Marine analysis revealed that the ports most exposed to a two-week strike would be New York, at $17bn and Houston, at $12bn.
Deeper exposure analysis shows that the commodities most vulnerable to the disruption are crude oil ($2.2bn), integrated circuit boards ($733m), cars and people carriers ($1.98bn) and pharmaceuticals ($1.518bn).
“With the looming specter of a strike at ports hanging over the US economy, our analysis reflects the wider economic damage, if it goes ahead in October,” said Suki Basi, managing director of Russell Group.
“While these figures are just for a two-week strike, they show the current connectedness of supply chains to any form of disruption and resulting impact on global trade, given the role that US ports play in facilitating shipments in and out of the US,” he said.
“Corporates and their (re)insurers need to have access to more granular data analysis in order to understand fully their exposures from such events so as to mitigate the potential consequences,” Basi added.
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