Canada Port Strikes End; Maersk, Hapag-Lloyd Issue Advisory

The recent labor strikes at Canadian ports have finally concluded, but the aftermath will continue to ripple through the supply chain. Despite operations resuming at Montreal and Vancouver, the disruptions have led to a significant backlog of containers.

Although the workers are back to work, the exact terms under which they agreed to end the strike are not clear yet.

The Montreal Port Authority (MPA) reported a staggering 5,000 TEU (Twenty-foot Equivalent Units) of cargo accumulated on the ground, with 22 vessels either en route or anchored. Additionally, they face the challenge of handling 2,750 TEU of rail cargo. The MPA warns that it may take several weeks to restore normalcy to the supply chain and process the backlog.

“It may take a few weeks to re-establish the fluidity of the supply chain and process all goods currently at the port of Montreal or in transit and due to arrive in the next few days,” said (MPA).

On the west coast, the Vancouver Fraser Port Authority (VFPA) acknowledged the severe impact of the 10-day strike, stating, "The 10-day strike significantly disrupted port operations." To manage the influx of vessels, the VFPA has implemented a priority-based anchorage allocation system to ensure fair distribution of port resources.

As a result of these disruptions, shippers are likely to face a new wave of detention and demurrage (D&D) charges, further exacerbating the challenges posed by the port congestion.

Shipping giants Maersk and Hapag-Lloyd issued advisories regarding the opening of ports, railways and truck routes, stating that backlogs and delays should be expected. Maersk said that “the workers have returned to duty, and terminals, rails, and carriers are resuming operations. Expect delays for ships arriving at Vancouver and Prince Rupert. Some vessels have already been impacted, and future schedules may be adjusted. Both ports are working to clear the backlog of cargo caused by the strikes,” its website advisory read. It also stated that Maersk will resume demurrage and detention fees for containers once operations restart.

Hapag-Lloyd issued a similar advisory, stating that “Recovery efforts after port reopening are ongoing and may take 4-6 weeks. Yard utilization and rail dwell times are gradually stabilizing.” Increased vessel delays and increased volumes are to be expected at Saint John port. Similar conditions to prevail at the Halifax port.

The port strike has been going on in the country for over 20 days in want of better working conditions and increased salaries. The Maritime Employers Association (MEA) had earlier tried to negotiate with the workers offering over 20% increment over six years, but the works rejected it and continued to strike.