Special Notice From C-Air - Friday, September 07, 2012 13:37

Update on Pending ILA Strike

To Our Valued Customers:

 As you have been advised and following, there is an impending ILA strike. If enacted it will cause major disruptions in the supply chain of Importers in the United States.

The strike is planned for September 30, and will affect the East Coast of the United States as well as Gulf Ports.

Speculation as to what will happen is difficult to predict as there are numerous factors in play.

 Talks which broke down last month are expected to resume on the week of September 17 as reported in today’s Journal of Commerce. Assuming the strike moves on as planned and without  Government intervention under the Taft Hartley Act ; importers will be faced with the following choices:

 Eastbound Containers---Importers can have containers booked to discharge at West Coast Ports ( including the West Coast of Canada) for eventual move to the intended Central or Eastern Parts of the United States via Rail. Those containers will be charged a Congestion Surcharge as announced by all major Carriers. Those Surcharges as posted by carriers ,will range between $800 and $1300. In this scenario, we would expect Bookings to  the West Coast to be backed up immediately with rollovers at Origin the norm as East Coast containers will have to compete with West Coast Customers for space on the West Coast bound Vessels. The containers as grounded on the West Coast will certainly experience some delay in moving Eastward. These containers may also be moved Eastward via Truck, but we are of the opinion that rates for same will skyrocket on simple laws of supply and demand. Please keep in mind that the existing terminals on the West Coast can berth and handle only so many ships.

 Westbound Containers---At this late point in time , Containers destined for the East Coast can be routed through Eastern Canadian Ports with eventual movement to the United States via Rail. Again, this shift in traffic will have addition U.S. Containers competing with those cargoes that currently use these lanes. We expect the backlogs at booking origins and the eventual rollovers of same.

 You are urged to continue to follow further postings and if you have any questions please feel free to contact us .

 We will continue to follow the negotiations as they move forward.