$63 billion knock to the US economy from a looming US East Coast port strike

A potential strike at ports across the US East Coast in October could deliver a $63 billion (£47 billion) knock to the US economy, according to our analysis. 

This analysis was based on a two-week strike from 1st October to the 15th of October, across leading US ports along the East Coast from New York to Houston, as calculated by our ALPS Marine exposure solution. 

If talks fail, beyond the deadline of the 30th of September between the International Longshoreman Union and the United States Maritime Alliance (USMX), there would be a strike at 36 ports including Boston, New York, New Jersey, Philadelphia, Houston, Tampa, Baltimore, New Orleans and the Port of South Louisiana. 

ALPS Marine analysis can reveal that the ports most exposed to a two-week strike would be New York, at $17 billion (£12 billion) and Houston, at $12 billion (£8.97 billion). 

Deeper exposure analysis shows that the commodities most vulnerable to the disruption are Crude Oil ($2.2bn /£1.64 bn), Integrated Circuit Boards ($733 million / £547 million), Cars & People Carriers ($1.98 billion / £1.48 billion) and Pharmaceuticals ($1.518 billion / £1.13 billion). 

Suki Basi, Managing Director of Russell Group commented on the figures: 

“With the looming spectre of a strike at ports hanging over the US economy, our analysis reflects the wider economic damage, if it goes ahead in October. 

“While these figures are just for a two-week strike, they show the current connectedness of supply chains to any form of disruption and resulting impact on global trade, given the role that US ports play in facilitating shipments in and out of the US. 

“Corporates and their (re)insurers need to have access to more granular data analysis in order to understand fully their exposures from such events so as to mitigate the potential consequences.”