Port Tracker report expects import cargo activity to pick up in March

image
By Jeff Berman, Group News Editor
March 13, 2012 - LM Editorial

Following a projected 6.8 percent annual decline in import cargo volume for February, the monthly Port Tracker report by the National Retail Federation (NRF) and Hackett Associates is calling for a 10 percent annual gain for March.

The ports surveyed in the report include: Los Angeles/Long Beach, Oakland, Tacoma, Seattle, Houston, New York/New Jersey, Hampton Roads, Charleston, and Savannah.

According to the report, total 2011 volume hit 14.8 million TEU (Twenty-foot equivalent) for a 0.4 percent increase over 14.75 million TEU in 2010. Volume in 2010 was up 16 percent compared to a dismal 2009. The 12.7 million TEU shipped in 2009 was the lowest annual tally since 2003.

“Retailers are still watching all the economic indicators very carefully, but there are enough signs of improvement that stores are carefully stocking up,” NRF Vice President for Supply Chain and Customs Policy Jonathan Gold said in a statement. “Retailers only import more if they expect to sell more, so these numbers are a sign that optimism is growing.”

For January, the most recent month for which data is available, U.S. ports surveyed in the report hit 1.22 million Twenty-foot Equivalent Units (TEU), which was up 4.4 percent from December 2011 and up 1.3 percent from January 2011.

On a recent Webcast hosted by Logistics Management, Hackett explained that even with relatively low growth levels and some economic uncertainty, “the overall economic fundamentals in the U.S. are strong, with steady retail sales growth, strong supply chain management, and a rebound in consumer confidence, couple with industrial production continuing to grow at a rate that has exceeded economists’ expectations.”

Port Tracker is now calling for February, which is usually the slowest month of the year, to hit 1.05 million TEU, which would be down 4.2 percent from February 2011. And March, which is when the report expects things to pick up again, is projected to hit 1.2 million TEU for a 10 percent annual gain. April is expected to be up 3.6 percent at 1.26 million TEU, and May is expected to be flat at 1.28 million TEU.

Looking at the first half of 2012, the report is calling for the first half of 2012 to account for 7.32 million TEU, which would represent a 2.4 percent annual gain. And the NRF noted in the report it expects 2012 retail sales to hit $2.53 trillion for a 3.4 percent gain.

Even with this projected increase, Hackett explained that there remains a significant overcapacity surplus situation for ocean vessels, with most carriers attempting to implement rate increases, which to date have not been sticking with success. But should these rate increases eventually stick he said it could impact retailers and other shippers from a rate and planning perspective.

“The maritime industry is in a quandary,” Hackett said in the report. “As long as this imbalance exists, there will be volatility in the freight rates.”

And in an interview with LM, Hackett explained that during the depths of the global recession going back to early 2009 about 1.4 million-to-1.5 million TEU of capacity was withdrawn, due to cancellations and missed voyages, with slow steaming—a practice used by ocean carriers in recent years to reduce fuel costs—is also factoring into that and still occurring at the moment.

What’s more, said Hackett, is current withdrawals account for roughly 1.1 million TEU, which is down 400,000-to-500,000 TEU from the peak of the recession in early 2009.

“Initial rate increases by carriers look like they are sticking, but if they add too much capacity the pressure will come on again,” said Hackett.

 



About the Author

Jeff Berman headshot
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. .(JavaScript must be enabled to view this email address).


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!

Recent Entries

February manufacturing data issued today by the Institute for Supply Management (ISM) dipped slightly compared to January, according to the most recent edition of the organization’s Manufacturing Report on Business.

As U.S. West Coast ports begin to address their critical congestion issues, an innovative approach is being launched at San Pedro Bay.

The ongoing financial travails of the Highway Trust Fund was made clear in a position paper recently issued by Jeff Davis, senior fellow at the Eno Center for Transportation. In the paper–entitled “Why Not A Ten-Year Surface Transportation Bill?”-Davis points to past federal transportation bills, as well as the White House’s GROW AMERICA proposal as having one fatal flaw in common: they each leave the HTF on worst financial shape after the bill expires than it was prior to the bill being enacted.

Working with research partner, The Economist Intelligence Unit, the IBM Institute for Business Value surveyed 1,023 global procurement executives from 41 countries in North America, Europe and Asia.

U.S. Carloads were down 7.8 percent annually at 259,544, and intermodal volume was off 15.7 percent for the week ending February 21 at 213,617 containers and trailers.

About the Author

Jeff Berman, 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.

Comments

Post a comment
Commenting is not available in this channel entry.


© Copyright 2015 Peerless Media LLC, a division of EH Publishing, Inc • 111 Speen Street, Ste 200, Framingham, MA 01701 USA