Workers began walking picket lines early Tuesday in a strike over wages and automation, even though some progress had been reported in latest contract talks. Photo via Getty Images

From Maine to Texas, dockworkers at 36 ports across the eastern U.S. are now on strike for the first time in decades. And the work stoppage could snarl supply chains — leading to shortages and higher prices if it stretches on for more than a few weeks.

Workers began walking picket lines early Tuesday in a strike over wages and automation, even though some progress had been reported in latest contract talks. The contract between the ports and about 45,000 members of the International Longshoremen’s Association expired at midnight.

The strike also comes just weeks before next month's tight presidential election, and could become a factor if there are shortages impacting voters.

In early picketing, workers outside the Port of Philadelphia walked in a circle and chanted “No work without a fair contract.” The union, which is striking for the first time since 1977, had message boards on the side of a truck reading: “Automation Hurts Families: ILA Stands For Job Protection.”

Local ILA president Boise Butler said workers want a fair contract that doesn’t allow automation of their jobs.

Shipping companies made billions during the pandemic by charging high prices, he said. “Now we want them to pay back. They’re going to pay back,” Butler said.

He said the union will strike for as long as it needs to get a fair deal, and it has leverage over the companies.

“This is not something that you start and you stop,” he said. “We're not weak,” he added, pointing to the union's importance to the nation's economy.

At Port Houston, at least 50 workers started picketing around midnight local time carrying signs saying “No Work Without a Fair Contract."

The U.S. Maritime Alliance, which represents the ports, said Monday evening that both sides had moved off of their previous wage offers. But no deal was reached.

The union’s opening offer in the talks was for a 77% pay raise over the six-year life of the contract, with President Harold Daggett saying it’s necessary to make up for inflation and years of small raises. ILA members make a base salary of about $81,000 per year, but some can pull in over $200,000 annually with large amounts of overtime.

Monday evening, the alliance said it had increased its offer to 50% raises over six years, and it pledged to keep limits on automation in place from the old contract. The alliance also said its offer tripled employer contributions to retirement plans and strengthened health care options.

The union wants a complete ban on automation. It wasn’t clear just how far apart both sides are.

In a statement early Tuesday, the union said it rejected the alliance's latest proposal because it “fell far short of what ILA rank-and-file members are demanding in wages and protections against automation.” The two sides had not held formal negotiations since June.

Supply chain experts say consumers won’t see an immediate impact from the strike because most retailers stocked up on goods, moving ahead shipments of holiday gift items.

But if it goes more than a few weeks, a work stoppage could lead to higher prices and delays in goods reaching households and businesses.

If drawn out, the strike will force businesses to pay shippers for delays and cause some goods to arrive late for peak holiday shopping season — potentially impacting delivery of anything from toys and artificial Christmas trees to cars, coffee and fruit.

The strike will likely have an almost immediate impact on supplies of perishable imports like bananas, for example. The ports affected by the strike handle 3.8 million metric tons of bananas each year, or 75% of the nation’s supply, according to the American Farm Bureau Federation.

It also could snarl exports from East Coast ports and create traffic jams at ports on the West Coast, where workers are represented by a different union. Railroads say they can ramp up to carry more freight from the West Coast, but analysts say they can’t move enough to make up for the closed Eastern ports.

J.P. Morgan estimated that a strike that shuts down East and Gulf coast ports could cost the economy $3.8 billion to $4.5 billion per day, with some of that recovered over time after normal operations resume.

Retailers, auto parts suppliers and produce importers had hoped for a settlement or that President Joe Biden would intervene and end the strike using the Taft-Hartley Act, which allows him to seek an 80-day cooling off period.

But during a Sunday exchange with reporters, Biden, who has worked to court union votes for Democrats, said “no” when asked if he planned to intervene in the potential work stoppage.

In an update Tuesday morning, the White House maintained that administration officials were working “around the clock” to help negotiations move forward — which included being in direct contact with both USMX and ILA. Biden and Vice President Kamala Harris were also “closely monitoring” potential supply chain impacts, the White House added, enlisting a task force to meet daily and prepare for any disruptions.

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Krisher in reported from Detroit. Associated Press journalists Ben Finley in Norfolk, Virginia, Mae Anderson and Wyatte Grantham-Philips in New York, Dee-Ann Durbin in Detroit, Josh Boak in Washington, and Annie Mulligan in Houston contributed to this report.

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Chevron CEO touts biofuels as part of its renewable energy efforts

Betting on biofuels

As Chevron Chairman and CEO Mike Wirth surveys the renewable energy landscape, he sees the most potential in biofuels.

At a recent WSJ CEO Council event, Wirth put a particular emphasis on biofuels—the most established form of renewable energy—among the mix of low-carbon energy sources. According to Biofuels International, Chevron operates nine biorefineries around the world.

Biofuels are made from fats and oils, such as canola oil, soybean oil and used cooking oil.

At Chevron’s renewable diesel plant in Geismar, Louisiana, a recent expansion boosted annual production by 278 percent — from 90 million gallons to 340 million gallons. To drive innovation in the low-carbon-fuels sector, Chevron opened a technology center this summer at its renewable energy campus in Ames, Iowa.

Across the board, Chevron has earmarked $8 billion to advance its low-carbon business by 2028.

In addition to biofuels, Chevron’s low-carbon strategy includes hydrogen, although Wirth said hydrogen “is proving to be very difficult” because “you’re fighting the laws of thermodynamics.”

Nonetheless, Chevron is heavily invested in the hydrogen market:

As for geothermal energy, Wirth said it shows “some real promise.” Chevron’s plans for this segment of the renewable energy industry include a 20-megawatt geothermal pilot project in Northern California, according to the California Community Choice Association. The project is part of an initiative that aims to eventually produce 600 megawatts of geothermal energy.

What about solar and wind power?

“We start with things where we have some reason to believe we can create shareholder value, where we’ve got skills and competency, so we didn’t go into wind or solar because we’re not a turbine manufacturer installing wind and solar,” he said in remarks reported by The Wall Street Journal.

In a September interview with The New York Times, Wirth touched on Chevron’s green energy capabilities.

“We are investing in new technologies, like hydrogen, carbon capture and storage, lithium and renewable fuels,” Wirth said. “They are growing fast but off a very small base. We need to do things that meet demand as it exists and then evolve as demand evolves.”

Houston robotics company partners with Marathon Petroleum to scale fleet

robot alliance

Houston- and Boston-based Square Robot Inc. has announced a partnership with downstream and midstream energy giant Marathon Petroleum Corp. (NYSE: MPC).

The partnership comes with an undisclosed amount of funding from Marathon, which Square Robot says will help "shape the design and development" of its submersible robotics platform and scale its fleet for nationwide tank inspections.

“Marathon’s partnership marks a major milestone in our mission to transform industrial tank inspection,” David Lamont, CEO of Square Robot, said in a news release. “They recognize the proven value of our robotic inspections—eliminating confined space entry, reducing the environmental impact, and delivering major cost efficiencies all while keeping tanks on-line and working. We’re excited to work together with such a great company to expand inspection capabilities and accelerate innovation across the industry.”

The company closed a $13 million series B last year. At the time of closing, Square Robot said it would put the funding toward international expansion in Europe and the Middle East.

Square Robot develops autonomous, submersible robots that are used for storage tank inspections and eliminate the need for humans to enter dangerous and toxic environments. Its newest tank inspection robot, known as the SR-3HT, became commercially available and certified to operate at a broader temperature range than previous models in the company's portfolio this fall.

The company was first founded in the Boston area in 2016 and launched its Houston office in 2019.