Strike Ends, OFAC Sanctions, IUU in Peru – Weekly Roundup 

The ILA strike is over, but major U.S. ports were affected and the delays/backlog right before a key holiday period likely spells trouble for the global supply chain. We’ve got the insights and numbers you need…

Also, new OFAC sanctions seem to reveal a link between Chinese/Hong Kong flags and Houthi weapons procurement…

And we look at why there was a 183% increase in the number of unique IUU fishing vessels that conducted slow-speed activity in Peru’s exclusive economic zone (EEZ)  between the weeks of September 22-28 and September 29-October 5, 2024. 

The ILA Strike’s Outcome and Impact on the Supply Chain

• The International Longshoremen’s Association (ILA) announced a strike in the East Coast ports on October 1, 2024, marking the largest dockworkers’ strike in the United States in half a century.
• Windward’s Maritime AI™ platform shows that between the weeks of September 22-28 and September 29-October 5, 2024, there was a 30% decrease in the number of weekly port calls conducted in the East Coast ports by container vessels and bulk carriers. The decrease was largely driven by the reduction in weekly port calls by container vessels (52% decrease).
• Data also shows the major ports that were affected by the strike and their respective decreases: New York (-51%), Norfolk (-54%) and Philadelphia (-50%).

Port calls by container vessels and bulk carriers in major East Coast ports, January 1, 2023-October 5, 2024.

• Windward’s Maritime AI™ Predictive ETA shows that shipments headed to the New York port during the time of the strike are experiencing significant delays of 10-17 days. Similarly, when examining shipments that are headed to Norfolk, our insights show significant delays of 15-20 days, mostly due to vessels’ allocations.

Example of a shipment headed to the New York port showing a significant delay due to the strike.

Example of a shipment headed to the Norfolk port showing a significant delay due to the strike.

• Public media sources reported that the ILA has agreed to suspend the strike until January 2025, signaling that ports will continue to operate, eventually concluding the strike after three days. But the effects of the recent strike will reverberate. East Coast ports are expected to suffer from significant congestion in the next couple of weeks. Based on Windward’s Maritime AI Predictive ETA, most shipments that are headed to the East Coast ports are expected to arrive at their port of destination in the middle of October. Further delays could occur due to ports’ work capacity.
• It is likely that even though the strike was suspended, it will still have a longer-term impact on the supply chain and economy, especially because we are rapidly approaching several important events/holidays – Black Friday, Cyber Monday, Singles’ Day, and Christmas. Using Windward’s AI-powered technology can help you better understand the impact of the strike and the accompanying delays.

New OFAC Sanctions Against Houthi Procurement Operatives and Suppliers in Iran and China

• The U.S. Department of Treasury’s Office of Foreign Assets Control (OFAC) announced sanctions on October 2 against one individual and three companies related to China and Hong Kong. The accused are alleged to have facilitated weapons procurement and smuggling operations for the Houthis. This included dual-use materials that are needed to manufacture, maintain, and deploy an arsenal of advanced missiles and unmanned aerial vehicles.
• Two vessels were sanctioned:
  • Izumo (IMO: 9249324) – a 272-meter crude oil tanker sailing under the flag of Gabon
  • Frunze (IMO: 9263643) – a 239-meter oil product tanker sailing under the Cook Islands flag

• Windward’s Maritime AI™ platform found that both vessels were flagged as high risk prior to their sanctions (Izumo since October 2022 and Frunze since February 2023). The Izumo was flagged as high risk due to seven location (GNSS) manipulation events. The Frunze was flagged as high risk due to a suspicious commodity ship-to-ship (STS) meeting with a sanctioned Iranian vessel.

• Windward’s historical data shows that both vessels have been sailing mainly between China and the Arabian Gulf. They possibly facilitate a supply chain of crude and oil products between China and Iran that could potentially be delivered to the Houthis.

Izumo’s historical path.

Frunze’s historical path.

• OFAC sanctioned four other facilitating companies in China last July that exhibited similar behavior and were suspected of supplying the Houthis with multi-purpose use oil that could aid their weapons programs. As geopolitical events keep unfolding, it is possible that more vessels could potentially be involved in such illicit trades. Using Windward’s data and compliance risk assessment capabilities can help you better monitor suspicious  vessels.

Increase in IUU Activity in Peru

• Public media sources recently reported that China is seeking to inaugurate the Chancay Port, major infrastructure owned by China’s state-owned COSCO, by the end of 2024. While the project will help Peru’s economy, it has also been suggested that it can be used by China to bypass Peru’s fishing regulations and operate its distant waters fleet (DWF). This could harm Peru’s artisan fishing industry. Sources already reported an increase in the number of illegal, unreported, and unregulated (IUU) fishing vessels operating in Peru’s exclusive economic zone (EEZ).
• More recently, Windward’s Early Detection model discovered that there was a 183% increase in the number of unique IUU fishing vessels that conducted slow-speed activity in Peru’s EEZ between the weeks of September 22-28 and September 29-October 5, 2024. 

Slow-speed activities by IUU-flagged fishing vessels in Peru’s EEZ.

• When examining the locations of the slow-speed activities, Windward data shows that the majority of slow-speed activities conducted by IUU fishing vessels were conducted near the ports of Callao and Chancay.

Map showing clustering of slow-speed activities by IUU-flagged fishing vessels in EEZ of Peru, September 29-October 5, 2024.

• While China’s IUU fishing in Peru is not a new phenomenon, Windward’s data shows that in recent years, especially since May 2023, there has been an increase in the fishing activity of China’s IUU DWF in Peru’s waters. This  might have been enabled by China’s COSCO project at the port of Chancay. IUU fishing drives several harms, such as local fisheries degradation, economical and environmental damage, and humanitarian issues of forced labor. Windward’s Early Detection model and IUU risk capability can help you monitor these activities and understand the activity pattern of IUU fleets in relation to their geopolitical context.