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July 12, 2023 : The workers’ strike at West Coast Canadian ports has entered its 10th day, causing concerns about price increases and product delays. Trade associations in the United States and Canada have warned about the strike’s impact. The U.S. receives around $572 million worth of container trade from Canada daily, and the disruption caused by the strike has raised concerns about supply chain stability.
The Canadian ports of Vancouver and Prince Rupert, where the strikes originated, play a crucial role in the trade relationship between the United States and Canada. Approximately 20% of U.S. trade passes through these ports. The Railway Association of Canada estimates that it could take three to five days for supply chains to fully recover for each day the strike continues.
Negotiations between the International Longshore and Warehouse Union and the British Columbia Maritime Employers Association have resumed with the help of mediators, emphasizing the need for a swift agreement to address the situation. However, an increasing number of vessels are diverting from Canadian ports and heading towards alternatives in the United States, causing potential delays and strain on supply chains.
The diversions of vessels may lead to delays in planned arrivals and impact the auto industry, which operates on just-in-time schedules. Container rerouting also extends delivery times and incurs additional costs. Consumers are likely to bear the brunt of these increased costs, similar to the challenges experienced during the Covid-19 pandemic.
The Port of Vancouver and Port of Prince Rupert are preferred destinations for U.S. trade due to their efficiency in receiving goods from Asia. The Canadian National Railway Company estimates that it will take weeks to months to alleviate congestion caused by the strike.
