A second strike in Liverpool will exacerbate congestion in European ports

Logistics experts warn that yet another strike scheduled for Tuesday at the Port of Liverpool will only exacerbate existing delivery delays caused by previous strikes in Felixstowe and Liverpool.

Dock workers in Liverpool, an important UK port and a port where the US is the No. 1 trading partner, will begin a seven-day strike from 11 to 17 October.

The Unite union told CNBC that they will continue to hold these strikes until their wages catch up with inflation. Inflation in the UK is currently 12.3%. Previous wage offers that the union rejected were between 7% and 8.3%.

Trade productivity at Felixstowe, the UK’s largest container port, and Liverpool have been hit by various strikes since August. The resulting diversion of trade from ports has snowballed congestion in other European ports.

Before the latest round of strikes, Andreas Braun, Crane Worldwide Logistics’ director of products for Europe, the Middle East and Africa, warned that there would be 45 days delays in delivering products to the UK after leaving the ship.

Recently The Unite union said it did not rule out a third strike in Felixstowe.

“Previous strikes in Felixstowe may be over, but port congestion is on the rise,” said Alex Charvalias, head of supply chain monitoring in transit at MarineTraffic. According to him, as of October 4, the total capacity of TEUs (containers) waiting outside the ports was about three times higher than usual, and amounted to more than 99 thousand TEUs (containers).

While the situation in Felixstowe is deteriorating, other ports are shut down as a result of previous strikes in Felixstowe and Liverpool.

“The port of Southampton has already begun to run into problems,” said Charvalias.

The average weekly throughput of TEUs waiting outside the port seems to be the highest in recent months, reaching 37,593 TEUs in the last week of September.

“Looking at the early days of this week (week 40), things are getting worse,” he said.

Brown told CNBC that the disruption of past strikes and Liverpool’s upcoming strike would no doubt exacerbate existing congestion.

“If the Felixstowe dock workers agree to a third strike, this will most certainly create additional delays and additional costs for all transport companies involved,” Brown said. “However, as consumer demand is low right now, retailers may be able to adjust their operations for the strike and plan for deviations. Unite has made it clear that until they reach their goal of higher wages, they will continue with further strikes that will eventually lead to overwork. and delays rise to an invisible level.”

The list of publicly traded retailers that make up the UK market is notable, including H&M, Inditex, Associated British Products, Abercrombie and Fitch, Urban Outfittersas well as Burberry. Portfolio company for the production of clothing and footwear PVCwhich owns brands such as Tommy Hilfiger, Calvin Klein, Warner’s, Olga and True & Co, and VF Corporationwhich owns Vans, The North Face, Timberland and Dickies, also operate in the UK and Europe. Levi Strauss recently blamed supply chain delays as well as a strong dollar for the recent loss of up to $40 million in sales. Diageo is a major exporter from both Felixstowe and Liverpool.