LONDON (BLOOMBERG) - Strikes at Britain's biggest container port this week have already caused major disruption to trade and are threatening retailers' busiest season of the year, according to a supply chain data company.
The risk of Felixstowe's strikes dragging on for longer than the current eight-day protest "is causing extreme anxiety for businesses", project44 warned, adding that delays on goods arriving in time for Christmas are "looking all the more likely".
Supplies for the festive period are often expected in the autumn.
Dockers' walkouts could trigger "a domino effect up and down supply chains", added Mr Christian Roeloffs, co-founder of Container xChange, a trading platform for the industry.
Felixstowe, owned by a unit of CK Hutchison Holdings, accused the Unite union of acting against the interests of its members on Wednesday (Aug 24), saying many are unhappy they have been unable to vote on the company's latest pay offer.
A day earlier, a union representative said the strike could go past the planned period if no agreement is reached.
Unite has said that dock workers want a raise of at least 10 per cent, while the company has offered 7 per cent and a £500 (S$8.20) bonus.
Mr Roeloffs said Felixstowe had not fully recovered from last year's trade congestion, even before the strikes, while industrial action in Germany earlier in the year and low water levels in the Rhine had put further strain on the continent's supply chains.
The biggest beneficiary so far is DP World's port in Southampton, where vessel container capacity jumped 200 per cent as of Aug 23, project44 said.
At London Gateway, also operated by Dubai-based DP World, it was up 45 per cent. Those terminals are receiving cargo diverted from Felixstowe, where activity has come to a halt and the nearly 2,000 striking workers and the port's owners appear no closer to a deal.
"Even if the strike is over within a week, which now looks unlikely, it will take containers several weeks to clear out, causing massive delays in the supply chain," said Mr Josh Brazil, vice-president of global supply chain insights at project44.
If that happens, project44 expects that "massive delays will be seen across the UK, with spillover effects into the European Union as containers get diverted to other ports" such as Rotterdam in the Netherlands or Le Havre, France.
What's more, "many UK and EU ports are already experiencing maximum capacity volumes, so their ability to handle even more may be limited", it said.
