U.S. East Coast port disruptions could dent Indian exports

A dockworker demonstrates after a delivery port strike went into impact throughout the East Coast on the Port of Wilmington in U.S., October 1, 2024.

The strike by staff throughout 36 ports alongside the U.S. East Coast and the Gulf of Mexico might have a deleterious impact on commerce flows from Asian international locations, and India is one among 4 nations which have a excessive reliance on the ports which have come to a standstill, Moody’s Analytics stated on Wednesday.

The ports affected by the strike known as by the Worldwide Longshoremen’s Affiliation, deal with nearly 55% of the container site visitors shifting out and in of the U.S. and embrace the most important 14 ports. Whereas the disruptive results of the strike will depend upon how lengthy it persists, Asian producers will probably be within the firing line if shipments from them to the U.S. are affected, the agency stated in a report.

Greater than 20% of complete Asian seaborne exports to the U.S. move via the 14 largest affected ports, accounting for nearly half of complete inbound commerce, the report famous, including that international locations with a excessive focus of exports to the U.S., coupled with excessive reliance on the disrupted ports, will face the most important complications.

Whereas Cambodia is anticipated to be the toughest hit, Moody’s Analytics’ report stated that India, Indonesia and South Korea even have an “outsize reliance on the hanging ports”.

The three international locations, it stated, had a “affordable export focus to the U.S.” and excessive reliance on the disrupted ports. That is the primary strike in America’s East Coast ports since 1977, when the same union motion lasted 44 days.

“If the events can come to an settlement to restart operations inside every week or two, the macro impacts will probably be minimal. If issues drag on longer, that ache will unfold additional, with backlogs resulting in shortages and rising value pressures,” the report flagged as doable hostile results. For Asia, these shortages could be centred on commodities, together with crude and refined petroleum in addition to electronics imported from the U.S.