Imports at major US retail container ports grew 7% year-on-year during 2017 as retail sales continued to increase and the industry wrapped up the year with a strong holiday season.
According to the latest Global Port Tracker report released yesterday (8 January) by the National Retail Federation (NRF) and Hackett Associates, the total for 2017 is expected to come to 20.1m Twenty-Foot Equivalent Units (TEU), topping last year’s previous record of 18.8m TEU by 7%. That would be more than double 2016’s 3.1% increase over 2015.
2017 set an all-time monthly record of 1.8m TEU in August and included five of only seven months when imports have hit 1.7m TEU or higher.
“Retail had a strong year fuelled by growing wages, higher employment and a boost in consumer confidence,” says Jonathan Gold, NRF vice president for supply chain and customs policy. “Retailers imported more merchandise than ever to meet demand for quality products at affordable prices, and growth is expected to continue in the year ahead.”
Cargo volume does not correlate directly with sales because only the number of containers is counted, not the value of the cargo inside, but nonetheless provides a barometer of retailers’ expectations.
Ports covered by Global Port Tracker handled 1.74m TEU in November, the latest month for which after-the-fact numbers are available. With most holiday merchandise already in the country by that point, the number was down 1.7% from October but up 5.8% year-over-year. A TEU is one 20-foot-long cargo container or its equivalent.
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By GlobalDataDecember was estimated at 1.6m TEU, up 2.6% year-over-year, while January is forecast at 1.68m TEU, up 0.2% from January 2017.
Looking further ahead, February is forecast at 1.62m TEU, up 12.6% from last year; March at 1.5m TEU, down 2.3%; April at 1.66m TEU, up 3.3%; and May at 1.73m TEU, up 0.4%. The February and March percentages are skewed because of changes in when Asian factories close for Lunar New Year each year.
Next month, many factories in China will close for up to four weeks in celebration of the New Year that begins on 16 February 2018 – posing massive problems for many small to mid-sized retailers and importers who must ensure that their spring season merchandise is produced, paid for and shipped prior to the shutdown.
US importers prepare for Chinese New Year factory shutdown
NRF earlier forecast that 2017 retail sales would grow between 3.2-3.8% over 2016 and that holiday sales would grow between 3.6-4%. However, year-end numbers will not be released by the Census Bureau until Friday (12 January).
“On a percentage basis, 2017 was one of the strongest increases we’ve seen since the end of the Great Recession,” says Hackett Associates founder Ben Hackett. “That’s no minor achievement at a time when many are trying to talk down the economy. The rate is expected to slow down some, but with 2017’s performance and continuing high consumer confidence, our models show continued growth in the coming year.”
