S&P Global Market Intelligence data signals solid U.S.-bound imports in January

United States-bound containerized freight imports saw solid growth in January, posting annual growth for the fifth consecutive month, following a 14-month stretch of annual declines, according to data recently issued by S&P Global Market Intelligence.

January imports, at 2.59 million TEU (Twenty-Foot Equivalent Units) rose 9% annually, representing the third consecutive month of annual growth coming in at 9%.

Industrial products again posted the fastest rate of growth, for the month, including a 14% increase in materials, which was paced by an 18% gain in chemicals, which S&P Global Market Intelligence said marks the fastest rate of expansion going back to September 2018.  And capital goods shipments were up 10% annually, which included a 14% gain in electrical components and power generating equipment.

On the other end, consumer goods experienced what the firm called a “broad-based slowdown in the rate of growth,” with consumer durables imports off 9% in January, down from December’s 13% annual gain, including a 1% decrease in consumer electronics and a 6% increase in furniture, following a 10% increase in December, and a 2% decrease for apparel.

S&P Global Market Intelligence explained that arrivals of January imports may be been partly disrupted by disruptions to shipping in the Red Sea from late December, adding that the impact of a full month of diversions “will only become apparent in February’s data.”

Chris Rogers, Head of Supply Chain Research for S&P Global Market Intelligence, said in an interview that when looking a little further back to January 2022, import shipments came in at 2.68 million TEU, making January 2024 3% below January 2022.

“Which is kind of to be expected, because in January 2022, things were still working through the import backlog and related problems at the time,” he said. “This new data shows how far things have come.”

To that end, Rogers explained that January 2022 was still what he called a “digging out period,” with ocean carriers trying to make sure everything got delivered to the ports.

“You are almost comparing a normal January with an abnormal January, not that there is necessarily such a thing as normal, but I think it is a degree of that,” he said. “There is also a degree of inventory reductions still going on. We see that in the apparel sector, down 2% annually. January is [typically] a little bit of an off month, or off seasonal month anyway, so there is that, as well as that kind of continued destocking process, which makes sense. That is because companies may still be worried about consumer spending, and interest rates are still high, so having high inventory levels is very much out of flavor.”

When asked how things are going in February, as well as on a year-to-date basis, Rogers said that activity has been stronger than expected, with the question of how much of that is due to some accelerated shipments related to concerns over the remainder of the year.

“We've seen a lot of companies talk about pulling shipments forward if there's going to be continued interruptions in the Red Sea,” he said. “There seems to be less concern about the Panama Canal but I think that's just because container ships can pay up to use the Panama Canal more than some of the bulk shipment or bulk shipping companies, like the energy companies and the coal companies and so on. There may be a little bit of a pull forward there but again, we don’t know that yet. February is always a bit of a weird month. I would also say January can be skewed a bit by what firms are doing around the Lunar New Year. I always prefer to take January and February together rather than kind of January on its on its own. I think it is safe to say that activity in the first month of the year is certainly stronger than we would have expected for the first quarter as a whole. We might be seeing some evidence of pull forward there.”

The firm also observed that the share of U.S. imports from Asia to West Coast ports increased from 43.0% in December to 45.7% in January, with January 2023 at 44.1%. And it added that is well below the January 2022 average, at 46.3%, as well as the January 48.2% average from 2016-2019.