U.S.-bound import outlook remains bright, says Global Port Tracker report

United States retail container import levels are expected to remain elevated through the balance of 2021, amid going port congestion and related supply chain issues, according to the most recent issue of the Global Port Tracker report, which was released today by the National Retail Federation (NRF) and maritime consultancy Hackett Consultants.

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; Jacksonville; 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.

“Dockworkers are unloading ships as fast as they can, but the challenge is to move the containers out of the ports to make room for the next ship,” NRF Vice President for Supply Chain and Customs Policy Jonathan Gold said in a statement. “We need better empty return procedures and more chassis, truck drivers, rail capacity and warehouse workers to keep the system moving. Retailers have enough inventory on hand to make sure shoppers won’t go home empty-handed this holiday season. But there are still items sitting on the docks or waiting on ships that need to make it to store shelves and online sellers’ warehouses. Retailers want to make sure customers have product choices.”

What’s more, the report observed how more than 70 ships were reported waiting to dock at the Ports of Los Angeles and Long Beach last week, with the wait at Los Angeles averaging two weeks over the past month.

“Those delays, in turn, can push back the vessels’ arrival at other ports on their schedules,” the report said. “Some carriers have announced plans to divert to other locations, but congestion is building nationwide.”

And the combination of congestion and supply chain disruptions have remained intact going back to last year and into this year’s Peak Season, the report noted. But as the process leading up to Peak Season has been far from typical, it said, with myriad retailers bringing in holiday season merchandise much earlier than normal, in order to ensure enough inventory was stocked. NRF also recently issued its holiday season sales forecast, which it classifies as the months of November and December, pegging 2021 to be up between 8.5%-to-10.5% annually.

For September, the most recent month for which data is available, import volumes—at 2.14 million TEU (Twenty-Foot Equivalent Units)—fell 5.9% compared to August and are up 1.4% annually. May 2021 remains the all-time highest-volume month, at 2.33 million TEU).

October imports were pegged at 2.19 million TEU, for what would be a 1.2% annual decrease. This would still mark one of the five highest-volume months on record, and it would also mark the first annual decline going back to July 2020, a period when U.S.-bound imports began to see material increases with businesses starting to reopen, coupled with pent-up consumer demand and retailers gearing up for the holidays.

For the following months, Port Tracker issued the following projections:

• November, at 2.17 million TEU, for a 3.3% annual increase;
• December at 2.18 million TEU, for a 3.5% increase;
• January, at 2.21 million TEU, for a 7.6% annual increase;
• February, at 2 million TEU, for a 7% annual increase; and
• March, at 2.17 million TEU, for a 4.1% annual decrease

Total volume, for the first half of 2021, was up 35.6% annually, at 12.8 million TEU, and total 2021 volume is pegged at 26 million TEU, for an 17.9% annual increase. Should the 2021 estimate come to fruition, it would stand as a new record, coming in ahead of the previous record set in 2020, at 22 million TEU.

Hackett Associates Founder Ben Hackett wrote in the report that what he called the “once vaunted supply chain” remains under an immense amount of pressure.

“The list of litanies is long with COVID-19, port and inland transportation congestion, lack of labor at all points along the chain, storms in Asia, lack of electricity in China, and insufficient vessel capacity making up just a few of the issues facing the industry,” wrote Hackett. “It does not look like it will get any better soon, with most commentators suggesting that we will continue to see problems well into 2022—and that is assuming that COVID-19 does not get out of control again.”

And he also observed that as landside transportation problems continue and a vast backlog of container ships builds on both coasts, which is estimated at more than 100 vessels, annual growth rates are coming back to more normalized patterns. This is due to the lessening of double-digit gains related to intermittent pandemic lockdowns.

“This does not mean volumes are dropping but rather that the economy and consumer demand have shifted to a more normal state,” he wrote. “We project that the levels of demand will stabilize and that we will have more seasonal patterns at a new quarterly level of 7 million to 7.5 million over the coming 12 months for the tracked ports.”