Port strike threatens U.S. dairy industry

By Blake Jackson

The ongoing labor strike on the East and Gulf Coasts has dealt a significant blow to the U.S. dairy industry, a sector heavily reliant on exports.

Dairy farmers are facing a crisis as the disruption in the supply chain is expected to have costly consequences.

Approximately 20% of U.S. milk production is exported annually, making it a vital component for maintaining market balance.

The strike threatens to disrupt this delicate equilibrium, potentially leading to lower prices for dairy farmers as inventories build up.

The impact of the strike is compounded by rising input costs, minimum wage increases, and reduced overtime thresholds for farmworkers.

These factors have significantly tightened margins for dairy farmers, making it difficult to absorb the additional costs.

Dairy products are a major agricultural commodity for the United States, accounting for $680 million in exports in 2022.

The two ports affected by the strike accounted for 21% of all U.S. dairy exports in 2023, valued at $1.7 billion.

The strike is not only affecting dairy exports but also other agricultural products. Over 75% of all U.S. agricultural exports, valued at $122 billion, were transported through ocean ports in 2023.

The disruption could lead to shortages of certain products, such as bananas, coffee, and other specialty items.

Farmers and ranchers rely on international partners to sell their products to markets around the world.

The port strike threatens to disrupt these supply chains, leaving perishable food rotting at the docks.

While there is a risk of shortages of some nutritional needs without importing food, the United States' diverse agricultural production ensures the nation's food independence.

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