Increasing import activity remains main theme of Port Tracker report

In echoing what has become a common refrain in recent months, the monthly Port Tracker report from the National Retail Federation (NRF) and maritime consultancy Hackett Associates continues to call for increased import activity at United States-based retail container ports.

By ·

In echoing what has become a common refrain in recent months, the monthly Port Tracker report from the National Retail Federation (NRF) and maritime consultancy Hackett Associates continues to call for increased import activity at United States-based retail container ports.

The main drivers for higher import levels, the report said, stems from a new labor agreement between the Pacific Maritime Association and the International Longshore and Warehouse Union (ILWU) still not complete, although West Coast ports are still fully operating while talks continue, coupled with retailers being concerned about a new deal not yet reached, resulting in higher import levels.

“The negotiations appear to be going well but each week that goes by makes the situation more critical as the holiday season approaches,” NRF Vice President for Supply Chain and Customs Policy Jonathan Gold said in a statement. “Retailers are making sure they are stocked up so shoppers won’t be affected regardless of what happens at the ports.”

The ports surveyed in the report include: Los Angeles/Long Beach, Oakland, Tacoma, Seattle, Houston, New York/New Jersey, Hampton Roads, Charleston, and Savannah, Miami, and Fort Lauderdale, Fla.-based Port Everglades. Authors of the report explained that cargo import numbers do not correlate directly with retail sales or employment because they count only the number of cargo containers brought into the country, not the value of the merchandise inside them, adding that the amount of merchandise imported provides a rough barometer of retailers’ expectations.

For the month of August, Port Tracker stated that imports are expected to hit an all-time record at 1.54 million TEU (Twenty-Foot Equivalent Units), which would be up 3.6 percent annually and be the highest import volume for any month since 2000, when NRF first started tracking import volumes.

June, the most recent month for which data is available, came in at 1.48 million TEU for a 9.1 percent annual increase, and July is estimated to reach 1.53 million TEU for an impressive 5.8 percent gain over July 2013. With the aforementioned August volumes pegged at 1.54 million TEU, September is expected to reach 1.48 million TEU for a 4.8 percent improvement, and October is also expected to hot 1.48 million TEU for a 3.3 percent uptick. November and December are projected to come in at 1.37 million TEU and 1.34 million TEU for 2 percent and 2.1 percent gains.

If these numbers hold, Port Tracker said that 2014 imports would reach 17.1 million TEU, which would be 6.2 percent higher the 16.2 million TEU recorded in 2013. The first half of 2014¬¬–at 8.3 million TEU-is up 6.9 percent annually.

Hackett Associates Founder Ben Hackett wrote in the report that even with import levels high because of the uncertainty surrounding the West Coast port labor situation, trade volumes are in a good place, due to U.S. GDP increasing in 11 of the last 12 quarters.

Hackett explained that a significant proportion of the import gains is due to the labor negotiations, with importers moving up shipments just in case, as well as an increase in private consumption, with consumer spending up 2.5 percent in the second quarter.

“The impact of this is that the Peak Season will be muted, suggesting that the monthly growth rates will be less than the seasonal norm,” he wrote. “Due to the jump in July imports, our West Coast projections were well up but not strong enough as we had anticipated more of a shift to the all-water route. Clearly, economic fundamentals are no match for cautionary measures to safeguard against labor relations.”

In an interview with LM, Hackett said it is like that the June and July inventory-to-sales ratio will show an uptick, due to importers bringing in large amounts of cargo early.

And he added this could result in increased activity at ports, due to larger vessels calling that could increase pressure on terminal and supply chain operations.

“Ships are pretty full, but part of the reason for that is that a lot of capacity was taken away, even though volumes are going up so in a sense it is sort of a slight of hand type of thing going on,” said Hackett. “Things will return to a more seasonal nature after October in all likelihood.”

 


About the Author

Jeff Berman, Group News Editor
Jeff Berman is Group News Editor for Logistics Management, Modern Materials Handling, and Supply Chain Management Review. Jeff works and lives in Cape Elizabeth, Maine, where he covers all aspects of the supply chain, logistics, freight transportation, and materials handling sectors on a daily basis. Contact Jeff Berman

Subscribe to Logistics Management Magazine!

Subscribe today. It's FREE!
Get timely insider information that you can use to better manage your entire logistics operation.
Start your FREE subscription today!

Latest Whitepaper
Increase Efficiency and Profits with Smarter Logistics Planning
Optimize your fleet by maximizing capacity and reducing empty miles
Download Today!
From the May 2017 Issue
Everyone is talking about terms like digitization, Industry 4.0 and digital supply chain management, but what sort of technologies fall under these broad terms, and how will they change the management capabilities at our disposal? To find out, we talked to some noted supply chain analysts, consultants and technology executives and gathered six digital trends to watch.
Transportation Trends and Best Practices: The Battle for the Last Mile
2017 Technology Roundtable: Are we closer to “Intelligent” Logistics?
View More From this Issue
Subscribe to Our Email Newsletter
Sign up today to receive our FREE, weekly email newsletter!
Latest Webcast
Going Beyond Rate Negotiations for Logistics Cost Savings
The pressure to reduce cost is a fundamental part of every organization today leaving many supply chain professionals constantly renegotiating rates. This webcast examines four areas that may hold untapped savings potentials and even help organizations negotiate better rates.
Register Today!
EDITORS' PICKS
The Evolution of the Digital Supply Chain
Everyone is talking about terms like digitization, Industry 4.0 and digital supply chain management,...
2017 Salary Survey: Fresh Voices Express Optimism
Our “33rd Annual Salary Survey” reflects more diversity entering the logistics management...

LM Exclusive: Major Modes Join E-commerce Mix
While last mile carriers receive much of the attention, the traditional modal heavyweights are in...
ASEAN Logistics: Building Collectively
While most of the world withdraws inward, Southeast Asia is practicing effective cooperation between...