Descartes March Global Shipping Report sees mixed import readings

The new edition of the March Global Shipping Report, which issued this week by Waterloo, Ontario-based Descartes, a provider of logistics based on-demand, software-as-a-service offerings, saw a sequential decrease and annual gain.

This is the 31st edition of the Global Shipping Report, going back to its debut in August 2021.

From January to February, Descartes reported that U.S.-bound container import volumes fell 6%, to 2,137,724 twenty-foot equivalent units (TEU), compared to January and were up 23.3% annually, topping pre-pandemic February 2019 by 19.5%. Descartes explained that the annual gain comes with the caveat that there was one day in February, due to Leap Year, as well as the timing of the Chinese Lunar New Year, which was on February 11, whereas it was on January 22 in 2023, with February 2024 seeing no impact on U.S. imports out of China, unlike January 2023, which did see an impact.

Chris Jones, EVP Industry Descartes, the report’s author, wrote that February 2024 was a strong month considering its brevity and continues the robust performance that started in January 2024.

“The combined effect of the Panama drought and the conflict in the Middle East on transit times declined in February and volume for the Gulf Coast ports remained constant versus January,” observed Jones. 

For the top 10 U.S. ports, Descartes found that U.S container volume was off 7.0%, from January to February, falling 135,850 TEU. The Port of Oakland (4,104 TEU) and Charleston (3,581 TEU) saw the highest container volume increases from January, and the ports of Long Beach (-72,319 TEU), Los Angeles (-31,940 TEU) and New York/New Jersey (-23,925 TEU) saw the biggest decreases.

February coastal volume share saw West Coast ports fall 2.5% to 40.5%, driven by what the firm called significant volume losses at the Ports of Los Angeles and Long Beach. And top East and Gulf Coast ports increased to 44.0%, for a 1.6% increase. When compared to smaller ports, the top 10 ports’ share in February 2024 decreased to 84.5%, down slightly (0.9%) versus January 2024.

China’s total U.S. import tally, from January to February, fell 10.6%, to 809,048 TEU, and down 19.4% compared to the August 2022 high. Descartes said that China represented 37.8% of the total U.S. container imports in February, a decrease of 2.0% from January, and down 3.7% from the high of 41.5% in February 2022.

For the top 10 countries of origin, Descartes reported that U.S. container import volume in February fell 7.9% (-132,269 TEUs) from January, with China having the greatest volume decrease (-96,125 TEUs) and Vietnam (9,456 TEUs) having the largest volume increase.

February 2024 port transit delays fell across the top ports with the exception of the Ports of Oakland and Tacoma, which saw increases. The top East Coast ports decreased with the Port of Houston seeing the greatest transit delay decrease, at 1.8 days.

The report cited various issues the global shipping sector needs to monitor in 2024, including:

• Monthly TEU volumes between 2.4M and 2.6M. Descartes said this level will continue to stress ports and inland logistics until infrastructure can be enhanced;
• Port transit wait times. If they decrease, Descartes said it’s an indication of improved global supply chain efficiencies capabilities or that the demand for goods and logistics services is declining;
• The continuing impact of the pandemic, as the spread of COVID subvariants continues to add uncertainty to the trajectory of the pandemic and impact supply chains in unpredictable ways as different countries are affected at different times and for different durations;
• The economy, with the U.S. an import-driven economy, and economic health an important indicator of container import volumes;
• Panama Canal-based trade flow. The combination of the drought impacting capacity and the recently ratified International Longshore and Warehouse Union (ILWU) could accelerate the redirection of the one million TEUs that shifted from the West Coast ports during the pandemic;
• Middle East conflict. Attacks on shipping in the Red Sea by Houthis from Yemen could cause carriers to forego the Suez Canal, extending transit times and negatively impacting global shipping capacity. The impact of diversions away from the conflict is still minimal on volumes or transit delays for the East and Gulf Coast ports, said Descartes; and
• the ILA/USMX contract negotiation. A potential strike on the South Atlantic and Gulf Coasts could disrupt U.S. container imports later in 2024. Given the current Panama Canal situation, shifting volume to West Coast ports could be extremely challenging or significantly extend transit times