Port workers are striking from Maine down to Texas, costing the U.S. economy as much as $5 billion per day but raising questions about how the strike will directly impact consumers.
Despite a run on toilet paper reminiscent of the early days of the pandemic, consumers shouldn’t see anything out of the ordinary on grocery store shelves or car lots for the first few days.
“Really, there’s no reason for anyone to be panicking at this point,” said Margaret Kidd, program director and associate professor of supply chain logistics at the University of Houston. Houston is one of the 14 major ports impacted by the strike.
But the longer this drags on, the more disruptions will occur, with prices poised to rise again after a period of falling inflation.
Jena Santoro, senior manager of global risk intelligence at the supply chain risk management firm Everstream Analytics, estimates consumers may start to see disruptions in fresh foods, pharmaceuticals and auto parts a week or two into the strike, which started early Tuesday morning.
Santoro said it will be roughly three weeks before wider disruptions begin.
“General consumer goods and retail items are actually least likely to see immediate impacts, as retailers and importers have roughly three to four weeks of inventory stockpiled, so any disruptions would occur only if the strike lasted longer than this,” Santoro said.
Here’s a breakdown of how the strike could play out for consumers.
Little to no impact in the first week
Consumers should not expect strike-induced disruptions during the first week, experts told The Hill, though resulting backlogs could be felt further down the line, even if the strike ends abruptly.
Tony Pelli, director of supply chain security and resilience at BSI, said while “there would likely be little to no immediate impact on consumers” during the first three days, a “strike of this length would take at least two weeks to fully clear.”
Businesses have been bracing for this strike for months. Many were able to get shipments in early or diverted through West Coast ports, or may be willing to spring for more expensive air transport from Europe in the short term.
“Companies are relying on pre-built inventory and making adjustments to manage the initial disruption,” said Madhav Durbha, group vice president of consumer packaged goods and manufacturing at the supply chain planning solutions company RELEX.
“Perishable food items are the main risk area, but there are no major shortages yet,” Durbha added.
There’s a built-in delay in the journey goods take from containers in ports to shelves in stores that provide a buffer in the short term.
“It’s going to take a week or two to come out of the port anyway, get to warehouses and start being distributed. So there’s a natural lag in there,” said Sal Mercogliano, an associate professor of history at Campbell University.
“What we’re going to see is, maybe in a couple of weeks, a little bit of congestion, which is the big thing,” Mercogliano said. “That’s when stuff is going to get stuffed up into the ports a little bit, and it’ll be hard to get containers out.”
Perishables, auto parts get jammed up after a week or two
One week or two weeks into the strike, port congestion could worsen, and consumers could see perishables and auto parts in particular start to dwindle.
“Fresh food, meat, seafood and vegetables will begin to show more noticeable disruption due to limited cold storage capacity and the perishability of these goods. Consumers may start to see price increases in grocery stores, especially for fresh produce like bananas,” Durbha said.
Perishables are transported in refrigerated containers, and Mercogliano suggested that “even the stuff that’s landed may start spoiling because containers are not being properly monitored” during the strike.
Santoro said a prolonged strike could impact the automotive industry and pharmaceuticals sooner rather than later, since these “time-sensitive supply chains” usually “have about half the amount of stockpiled inventory, so roughly one to two weeks’ worth before raw material and parts delays could start to create shortages.”
Pelli also said that “some effects on pharmaceuticals and healthcare products may also start to appear, though many of these could be shipped by more expensive air freight.”
Coffee, champagne, cheese and more disappear a month in
Three or four weeks into the strike, just before the Nov. 5 general election, is when consumers could start really feeling the pinch from the port strikes.
“The flow of material out of the ports into the warehouses into the distribution centers isn’t going, and they start wearing through what’s in the warehouses, in the distribution center. So you start seeing some shortages,” Mercogliano said.
The U.S. imports the overwhelming majority of its coffee, which could lead to what Mercogliano described as “the nightmare scenario: Americans without caffeine.”
The U.S. also imports a lot of cheese and alcohol, which are in high demand ahead of the holiday season.
“The fall tends to be a really busy season for champagne and spirits, so it could have an impact there without a doubt,” Kidd said.
In 2023, 43 percent of distilled spirits imports came through the ports impacted by the strike, according to the Distilled Spirits Council of the United States (DISCUS). These ports also exported more than three-quarters of U.S. distilled spirits last year.
DISCUS, a trade association representing the spirit industry, called this “a critical time for the spirits sector,” as 20 percent of total spirit sales happen during the holiday season.
But it’s not just coffee, champagne and cheese. Darin Miller, national director of marine at Sedgwick said that after a month, “consumers will notice everyday items missing from the store shelves.”
And when items do make it to shelves, they will likely be more expensive.
“Imported goods will be delayed as they are rerouted to open ports, such as ones on the West Coast or ones that use non-Union labor, which will cause increased voyage time and extended trucking or inland transport. As a result, prices may increase due to the additional costs associated with the rerouting,” Miller said.
