The U.S. supply chain was only granted about a month of relief after a three-day East Coast port strike that represented the largest shutdown of its kind in nearly a half century. Now, importers are facing the ramifications of a Canadian labor strike from the country’s east coast in Montreal to its west coast in British Columbia.
- The most recent strikes began Nov. 4 in Vancouver and Port of Prince Rupert, two of the largest ports on the Canadian west coast, resulting in a complete work stoppage at the ports.
- The week prior, a strike at the Port of Montreal – the country’s second largest port – has resulted in the port processing only 40% of volume.
- The ramifications of these strikes on the U.S. and promo supply chain are inevitable. About 20% of U.S. trade arrives through Vancouver and Prince Rupert ports alone, which are currently shut down. Approximately $800 million in trade flows through these ports every day.
In the ports of Vancouver and Port of Prince Rupert, the International Longshore and Warehouse Union (ILWU) Local 514 was previously working despite a contract that expired on March 31, 2023. More than 95% of union members voted in support of a strike. The British Columbia Maritime Employers Association has said that it locked out workers after ILWU issued a 72-hour strike notice.
- After negotiations between the two sides stalled with automation said to be a primary sticking point preventing resolution, talks are set to resume on Saturday, Vancouver Sun reported.
Promo Perspective
Long-term consequences of these Canadian port strikes on the overall North American promo supply chain will depend on how long the work stoppages continue. PPAI Media has been in contact with Canadian promo companies confirming they are already affected.
“[The strikes] absolutely are and will affect us, depending on how long it goes on for,” says Nigel Harris, CEO of PowerStick.com, PPAI 100’s No. 75 supplier. “With 40% of the Montreal port shut down and both BC ports now on strike, there is increasing pressure for this to be resolved. Along with all other Canadian importers who use BC ports for their incoming Asian shipments, we are anxious for an early resolution.
Unfortunately, there has been no movement in the past two days, so we fear both parties could be digging in their heels
Nigel Harris
CEO, PowerStick.com
“Unfortunately, there has been no movement in the past two days, so we fear both parties could be digging in their heels.”
Asif Bandeali, COO of Fairdeal, based out of Ontario, says that the supplier learned lessons from experiences related to COVID-19 to not rely on inventory that arrived “just in time,” but eventually the British Columbia strikes will take their toll.
“It’s not anything serious at the moment where orders are affected,” Bandeali says. “If the strike goes on for weeks, then us and our distributors will be impacted much more.”
If the strike goes on for weeks, then us and our distributors will be impacted much more.
Asif Bandeali
COO, Fairdeal
There are, of course, contingency plans, but, as things stand, they are not particularly promising.
“New containers leaving overseas would be rerouted to the U.S. or Eastern Canada depending on the situation at the time of shipping,” Bandeali says.
Both options currently have their own setbacks. Eastern Canada is dealing with the labor issues at the Port of Montreal, currently operating at 40% volume. Rerouting to the U.S. is plausible, but shipments were already rerouted to the ports along the West Coast of the U.S. in anticipation of the October 1 strike along the U.S. East Coast, leaving those West Coast ports congested to a degree that they have not fully recovered from.
“We are hopeful the government will intervene if the strike is prolonged,” Bandeali says.
This remains a possibility, but the Canadian government just watched President Biden refuse to act prior to the U.S. East Coast strike, which managed to reach resolution in three days without government intervention.
A Fragile And Fatigued Global Supply Chain
Speaking of those strikes along the U.S. East Coast only five weeks ago, the agreement that was reached to get those workers back on the ports primarily concerned wages. Like the Canadian strikes, automation remains a point of contention between the two sides. The unions sent their members back to work contingent on a 100-day pause of stoppage, which will end January 15. That means fears of another strike remain just around the corner.
These are just a few factors of a promo supply chain that continues to weather obstacles.
Written by: Jonny Auping
Published with Permission from PPAI
