Making Progress

Key issues include wage increases, terminal automation, healthcare, and retirement benefits.

The union is demanding a 78% wage increase, equating to $5 more per hour each year over six years, while USMX is reportedly offering around 40%, which is far below the union's expectations. This comes in contrast to the ILA’s previous agreements, which secured a $1 per hour annual increase.

In addition to wages, automation at marine terminals remains a critical unresolved issue. ILA Executive Vice President Dennis Daggett called for tightening existing protections to prevent operators from incrementally implementing automation, which the union views as a threat to jobs, citing a dispute with Maersk’s APM Terminals subsidiary for allegedly violating the current master contract by introducing automation technology at the Port of Mobile.

Dennis Daggett also argued that the union should maintain control over certain tasks even after containers leave the terminal, stating that this is essential for the long-term survival of longshore jobs. He warned that without resolving this jurisdictional issue, even a significant wage increase would be meaningless if jobs continue to diminish due to automation and outsourcing.

ILA President Harold Daggett has warned of a strike if no agreement is reached by September 30, potentially disrupting key ports and affecting the economy during the holiday season and U.S. presidential elections.

Daggett also addressed the union in prepared remarks, warning that it would be a significant moment if the union is without a new contract by the October 1 deadline. He urged members to be prepared to strike if necessary, underscoring the union's readiness for direct action.

Industry groups are urging both parties to resume talks.

Trump introduced tariffs on over $300 billion in goods, and Biden has continued these measures, increasing rates on items like electric vehicles and solar panels.

Both parties view tariffs as essential to protecting U.S. industries, though their approaches differ. Trump advocates raising tariffs further, while Biden uses tariffs alongside domestic incentives to support American manufacturers.

Presidential candidate Kamala Harris’s stance on tariffs is less clear. However, if she maintains Biden's policies, tariffs will likely stay in place under her administration.

Regardless of the election outcome, tariffs on China are expected to remain a key tool in U.S. trade policy.

Following the attacks, ZIM and other shipping companies began rerouting their vessels to avoid the Red Sea, opting for longer, more fuel-intensive routes.

These additional fuel costs are passed on to consumers, and according to reports, the price hikes charged to consumers often exceed the actual additional expenses incurred by the shipping companies. As a result, ZIM has not only covered the extra costs but has also seen a significant increase in profits.

Yemen’s Iran-backed Houthi group has been disrupting global trade by targeting ships in the Red Sea corridor since the October 7 attacks, threatening to attack vessels heading to Israeli ports, even those not passing through the Red Sea, and have claimed responsibility for missile and drone attacks targeting Israel.

MSC currently operates a fleet of 852 ships, representing over 6 million TEUs and nearly 20% of the global liner market share, having acquired 383 second-hand container ships in the past four years.

Recent acquisitions by MSC include the 1,440 TEU CAPE FLINT from Schoeller Group and the 2,526 TEU JAN RITSCHER from Reederei Gerd Ritscher, along with several medium-sized vessels such as the 5,364 TEU EVER UNITY and five ‘classic panamax’ ships with capacities ranging from 4,173 to 4,713 TEU.

In parallel, COSCO SHIPPING Development, a subsidiary of the China state-owned COSCO Group, has announced its largest shipbuilding and leasing deal since 2016, valued at over $2 billion.

The deal involves the construction of 42 bulk carriers by two major shipyards—20 by COSCO SHIPPING Heavy Industry’s subsidiaries and 22 by CSSC Chengxi Shipyard.

These new vessels, including 64,000-DWT, 82,000-DWT, and 80,000-DWT ships, will be delivered in 2026 and 2027.