The countdown has begun but shippers are not waiting. Negotiations between West Coast dockworkers and the Pacific Maritime Association are in progress in the face of a 1 July expiration of the existing contract, but contingency planning is underway.

Import volume at major US container ports is forecast to grow at 7.5% in June year-to-year as retailers seek to hedge against a possible strike or slowdown. April (up 10.3 %) and May (up 5.8%) numbers were considered abnormally high.

The parties have given few indications of progress, or lack thereof, but the issues are nettlesome, the ports are nervous about container trends, and some “theater” is expected at the wire.

In 2002, the International Longshore and Warehouse Union, now representing 13,600 workers, engaged in a slowdown as an alternative to a strike. Major shippers reacted, and the result was a shift of major delivery flows from Asia to all-water routes serving import facilities on the East Coast. Ports like Savannah thrived.

The next time the contract was up for renewal in 2008, it was renewed without incident. Now it’s 2014. And shippers are making contingency plans, just in case.

There are a number of sticky issues in the offing. First is the question of who pays for a future “Cadillac tax” on expensive health care plans such as the dockworkers have. The tab could run as high as $150 million.

Next are jurisdictional disputes over jobs at PMA members, and truck turnaround times at the ports where waiting lines can run to several hours. Rail congestion has been relieved due to various projects.

The negotiations also come amid a backdrop of competitive pressures on West Coast from several directions.

The Panama Canal expansion is scheduled for completion in early 2016, and East and Gulf Coast ports are gearing up to try to pull in cargo that now arrives at West Coast ports. The President this week signed legislation to fund a backlog of dredging projects that will ensure additional capacity.

The West Coast ports, like ports worldwide, are also in a pinch over the adjustment to the new world of ultra-sized ships and carrier consolidation via various alliances. The size and design of many container terminals is not consistent with the requirements to handle larger ships with fewer calls.

Seattle and Tacoma, facing overcapacity, have talked about a consolidation, and the subject has been broached among terminals in the LA Basin.