• Supply chains suffer as strike actions continue at Swedish ports

    28 February 2019

    Since mid-January 2019, shipping to and from several Swedish ports, including major container gateways such as Gothenburg, has been affected by nationwide strike activities led by the Swedish Dockworkers’ Union (SDU). The actions have been initiated against Ports of Sweden, the employers’ organization, to establish a collective bargaining agreement for the port workers.

    The strike comes less than 2 years after a similar labor dispute at the Port of Gothenburg in 2017, which cost the Scandinavian logistics gateway more than 30 percent of its annual container volume. This year’s strike has been split into several rounds of actions. Ports which have so far been most affected include the ports of Gothenburg, Helsingborg, Monsteras, and Karlshamn. To avoid further escalation of the labor dispute, the National Mediation Office has called for a new round of talks between the SDU and Ports of Sweden on March 4 after dockworkers announced their intention to start an indefinite, nationwide strike at all ports from March 6.

    Negotiation breakdown triggers walkouts

    The conflict between the SDU and Ports of Sweden has been ongoing for decades but intensified at the end of 2018 as both parties started to negotiate a national collective bargaining agreement. The SDU demanded a very similar agreement to the one already in place for the Swedish Transport Workers’ Union (STWU), another major union representing dockworkers.

    Following the breakdown of negotiations on January 22, dockworkers across Swedish ports began to walk out from their jobs in 3-hour intervals on January 23 at port terminals that have SDU representatives. Ports of Sweden then responded by locking out its workers, causing work stoppages ranging from several hours to one day at several ports, including in Gothenburg, Helsingborg, Malmö, Stockholm, Gävle, and Karlshamn.

    Ro-ro container traffic experiences severe delays

    Following a first round of strikes on January 23 at 17 ports across Sweden, a second round began on February 6 and largely affected operations at smaller ports including Monsteras, Halmstad, Holmsund, and Sundsvall during short intervals. In many cases, the Ports of Sweden responded with lockouts. One week later, dockworkers started a third round of strikes on February 17, conducting work stoppages for 3-4 hours per day until February 22 at the roll-on/roll-off (ro-ro) terminal of the Port of Gothenburg. This severely disrupted ro-ro shipments between Gothenburg and destinations in Germany, Belgium, and the UK. Port workers at Helsingborg, Malmö, and Gävle later joined the strike actions on February 18.

    While Ports of Sweden initially planned full-day lockouts over 5 days, it later revised its decision to allow for further talks. Nonetheless, reports suggested that customers in the automotive industry were particularly impacted by the strike as the industry relies on ro-ro and container traffic from Sweden to mainland Europe. Impacts were largely experienced in the form of severe delays and higher transportation costs as carriers diverted shipments to alternative ports or switched to other modes of transportation, such as trucking.

    It is important to note that only port terminals where the SDU has their own representations have been affected by the strikes so far. Other terminals without representation may continue to function normally and may not be impacted at all. Minimal disruption has, for instance, been reported at the Port of Trelleborg, the largest ro-ro port in Scandinavia, as port workers are not affiliated with the SDU.

    New talks planned for March 4 to avoid further escalation

    A fourth round of strikes was staged on February 27 and 28 at the ro-ro terminal in the Port of Gothenburg, with further actions being planned for March 3, 4 and 5. This will likely continue to impact lead times in the next two weeks for major ferry services departing or arriving in Gothenburg, including from and to the UK and Belgium. Highlighting the extreme volatility of the situation, dockworkers on February 27 announced their intention to embark on an indefinite strike at all ports from March 6. This escalation of the conflict comes as Ports of Sweden plans to impose a lockout of port workers from March 6 until July 31, which would reduce dockworkers’ salaries, prevent them from overtime work, and install a freeze on hiring union members. To prevent the conflict from further escalating, the Swedish National Mediation Office has called for a new round of talks between the SDU and Ports of Sweden on March 4. While the SDU has confirmed its intention to participate in the meeting, it remains unclear at this point whether an agreement can be reached to avert the strike.

    To mitigate delays and higher logistics costs, customers may consider diverting shipments to nearby unaffected terminals or using trucking options to ship goods to their final destinations. Germany or Belgium-bound cargo can be loaded onto ferries departing from Gothenburg to Kiel, a route which has remained unaffected, and continued via truck. Alternatively, customers can consider using road freight services from Sweden via Denmark and the short Rodby-Puttgarden ferry route if further flexibility is needed for time-critical shipments. Non-standard routings to the UK, which may further increase shipping costs and lead times, could include road freight services to the Danish Port of Esbjerg, where cargo can be loaded onto ferries departing for the Port of Immingham in northeastern UK.

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