US retail imports set to rise as port shutdown looms
February import volumes are expected to total 1.37m containers
Import cargo volume at major US retail container ports is set to grow 10.1% year-on-year in February, as West Coast ports come closer to a possible shutdown due to the lack of labour contract for some 20,000 dockworkers.
The Global Port Tracker report released by the National Retail Federation (NRF) and Hackett Associates forecasts February import volume to total 1.37m containers, up from the same month last year, but down from the 1.48m predicted for January.
“With cargo volume growing as the economy continues to recover, the last thing we need is a port shutdown that would bring billions of dollars of economic activity to a halt,” said NRF vice president for supply chain and customs policy, Jonathan Gold.
“Whether it’s in retail, manufacturing, agriculture or other industries, there are too many jobs that rely on the ports to let that happen. Labour and management need to do whatever it takes to reach an agreement and do it today.”
The Pacific Maritime Association (PMA) and International Longshore & Warehouse Union (ILWU) have been engaged in talks since 12 May. The lack of contract and other operational issues has led to crisis-level congestion at the ports, and as a result a federal mediator was appointed in December to help with negotiations.
Cargo import numbers do not correlate directly with sales because they count only the number of cargo containers, not the value of the merchandise inside them. Nonetheless, the amount of merchandise imported provides a rough barometer of retailers' expectations.
Ports covered by Global Port Tracker handled 1.44m Twenty-Foot Equivalent Units (TEU) in December, the latest month for which after-the-fact numbers are available. That was up 3.2% from November and 9.3% from December 2013. That brought 2014 to a total of 17.3m TEU, an increase of 6.6% from the prior year's 16.2m. One TEU is one 20-foot-long cargo container or its equivalent.
January was estimated at 1.48m TEU, up 7.5% from January 2014. February is forecast at 1.37m TEU; March at 1.34m TEU, up 3%; April at 1.49m TEU, up 4.3%; May at 1.56m TEU, up 4.9%, and June also at 1.56%, up 5.3%. Those numbers would bring the first half of 2015 to 8.8m TEU, an increase of 5.8% over the same period last year.
“East Coast ports have been the beneficiaries of the labour disputes on the West Coast,” Hackett Associates Founder Ben Hackett said, referring to the shift of market share that has occurred as cargo has been diverted in recent months because of West Coast congestion. “We have to admit that we underestimated the level of the switch.”
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