US port strike poses significant fertilizer supply chain risks: trade group

The looming port strike by the International Longshoremen’s Association that threatens to shut down ports across the US East Coast and Gulf Coast starting Oct. 1, could cause “significant” disruption to the fertilizer trade, according to the The Fertilizer Institute, a US-based trade group.

ILA said its dockworkers are set to hit picket lines Oct. 1 over “an unacceptable wage package that we reject,” in the first strike by the union at East and Gulf Coast ports since 1977.

The ports being affected by the labor dispute accounted for nearly 50% of US fertilizer trade over the last five years, with phosphate seeing the largest disruptions among major nutrients, according to data compiled by The Fertilizer Institute.

“Within the global fertilizer marketplace, Tampa, New Orleans, and Houston are three of the US’s most important ports for fertilizer imports and exports," Ryan Bowley, the group's vice president of government affairs, said Sept. 30. "Over half of all East and Gulf Coast fertilizer exports move through Tampa, while over 70% of the region’s fertilizer imports enter the country through New Orleans."

The fertilizer trade is mostly conducted via bulk transportation, which is generally unaffected by ILA work stoppages, but the impacts on container movement can have a spillover effect, as they are “increasingly important for the industry,” the trade group said.

“TFI urges both parties to return to the negotiating table and calls for action by the White House, if necessary, to get the ports open again,” Bowley said.

The Biden administration has urged ILA and the United States Maritime Alliance to go back to the negotiating table and work out their differences to avert a strike. However, President Joe Biden said he had no plans to invoke the Taft-Hartley Act, which would pause the strike and send both sides back to the negotiating table.

A labor dispute by Canadian rail workers also threatened to disrupt the fertilizer supply chain, before the Canadian government moved to end the single-day strike on Aug. 22.

About 75% of all Canadian fertilizer products depend on rail transportation for both domestic use and international trade, according to Fertilizer Canada. Disruptions are estimated to cost daily the fertilizer industry around C$55 million-C$63 million ($40 million-$46 million) in lost sales revenue, not including logistical and operational costs, Fertilizer Canada said at the time.