An eight-day strike that began on Sunday has put imports and exports worth around 800 million pounds (about 950 million euros) at risk. The apparel and electronics industries are particularly affected.
First Brexit, then pandemic – and now labor disputes: A multi-day strike by longshoremen at Britain’s biggest container port threatens to further strain not just British supply chains. “Nearly half of UK container traffic passes through the port of Felixstowe and 65% of inbound containers,” said British trade expert Rebecca Harding.
An eight-day strike that began on Sunday has put imports and exports worth around 800 million pounds (about 950 million euros) at risk. The apparel and electronics industries are particularly affected.
Global container traffic is stumbling
But the strike is not just a problem for the island: global container traffic at sea, the lifeline of world trade, has been increasingly out of whack since the corona pandemic began two and a half years ago. Every disruption, such as blockages at individual ports, an accident like the “Ever Given” Suez Canal or labor disputes, puts more force in the gears – even if a port like Felixstowe is not a very important player in coordinating maritime logistics mechanism. on an international scale.
“One of the reasons for tense logistics at sea and in ports is poor ship punctuality,” says economist Vincent Stamer, who analyzes global container traffic at the Kiel Institute for the World Economy (IfW). “Additional strikes will make this situation worse – including the impending strike at Britain’s biggest port of Felixstowe.” In addition, logisticians also fear new warning strikes in Germany. That would be possible if the next wage round in the dispute over port workers’ wages does not succeed on Monday. More recently, the Verdi union halted handling at all German North Sea ports for 48 hours in mid-July.
Union demands pay raise
In Felixstowe, 1,900 dockworkers on the east coast of England wanted to quit. “Few people showed up for work this morning,” said Miles Hubbard of the Unite union. This had called for the strike after an agreement with the employer, the Felixstowe Dock and Railway Company, failed. The offer of a seven percent salary increase is not high enough for the union, given soaring consumer prices. Inflation rose to over 10 percent in the UK in July. Unite announced that the strike “will send massive shockwaves through the UK’s supply chains”. In Liverpool, too, dockers want to quit their jobs soon.
The extent to which the strike interrupts shipping companies’ already stressed schedules depends largely on the role the port plays in them. Co-industry leader Maersk expects “significant effects on the ship program”, as a spokesman for the Danish shipping company said. The port is to be called during strike days by nearly a dozen container giants. “While we are maintaining all ship calls at Felixstowe, we expect some arrival times to be significantly advanced or delayed.” The Hamburg shipping company Hapag-Lloyd, on the other hand, is “not directly affected”, as a spokeswoman explains. “We only have a weekly service for Felixstowe.”
The British Ports Association does not yet expect any long-term effects on British supply chains. In recent years, there has been a lot of investment in infrastructure, which is why it is also possible – if necessary – to temporarily move more container freight than usual.
Possible short-term bottlenecks
Ulrich Hoppe, director of the German-British Chamber of Industry and Commerce, believes short-term bottlenecks are unlikely. “I don’t think we’ll see empty shelves in supermarkets.” Fresh produce such as fruits and vegetables tend to pass through the port of Dover. It is conceivable, however, that goods such as toys from China, which are often transported in containers, will experience delays — and more pressure will be placed on supply chains, which are already strained by the pandemic and other challenges.
“Trade between Britain and the rest of the world, especially the EU, has already collapsed in the past year and each new disruption adds to the already mounting pressure,” said trade expert Harding. She thinks it’s possible that inflation will continue to rise if major supply chains go awry. “This would further exacerbate the cost-of-living crisis, which is already so severe in the UK.”
(APA)