Talks resumed in the early afternoon, with negotiators still aiming to resolve key differences on wages, pension benefits and other issues.

"We're taking baby steps here, very slowly making some progress," said John Fageaux Jr., president of Local 63 of the Office Clerical Unit of the International Longshore Warehouse Union.

The 15,000-member ILWU has indicated that longshoremen would honor picket lines if the 750 clerks strike.

That would effectively shut down loading and unloading operations at the neighboring ports of Los Angeles and Long Beach, which account for 40 percent of all the cargo container traffic coming into the U.S.

"We've got some big hurdles yet to get over, and hopefully we will," said Steve Berry, lead negotiator for the 14 marine terminal operators and other employers.

The clerks union had warned that a strike would occur if no deal was reached by 12:01 a.m. Monday, but negotiations continued after the deadline.

Paul Bingham, an economist with Global Insight Inc., said the continuing talks could signal a diminished strike threat.

"All the signals are there now that they're both serious about getting this resolved," Bingham said.

The negotiations have been closely watched by the retail industry, with a few companies diverting goods through other ports to avoid possible problems.

"There are a few shippers that are doing that, perhaps to a limited degree, on things they absolutely can't afford any risk of delay on," Bingham said.

The clerks work at marine terminals and handle bookings for the export of cargo and other transport documents.