Import cargo volume expected to go up, then down
WASHINGTON — Import cargo volume at the nation’s major retail container ports is expected to be up 16 percent in July compared with the same month a year ago, but double-digit increases seen in recent months should taper offer this fall as retailers cautiously manage their inventories, according to the monthly Global Port Tracker report released yesterday by the National Retail Federation (NRF) and Hackett Associates.
“We are still seeing increases in imports, partly because last year’s volumes made for easy comparisons and partly because of real improvements in the economy and consumer spending,” NRF vice president for supply chain and customs policy Jonathan Gold said. “But, retailers are being cautious as they look at numbers for employment, housing and the availability of credit. There clearly can’t be consistent growth in consumer spending when customers don’t have jobs. That means retailers are going to have to manage their inventories more carefully as the year progresses. We’re still going to see increases in container volume, but not as large as what we’ve seen so far. As retailers head into the peak shipping season, they will also to need to address challenges they are currently facing with lack of vessel capacity and with labor and congestion issues at some of the ports.”
U.S. ports handled 1.25 million Twenty-foot Equivalent Units (TEUs) in May, the latest month for which actual numbers are available. That was up 10 percent from April and 20 percent from May 2009. It was also the sixth month in a row to show a year-over-year improvement after December broke a 28-month streak of year-over-year declines. One TEU is one 20-foot cargo container or its equivalent.
June was estimated at 1.24 million TEU, a 22 percent increase over last year as summer merchandise arrived on store shelves. July is forecast at 1.29 million TEU, up 16 percent from last year; August at 1.26 million TEU, up 9 percent; and, September at 1.29 million TEU, up 13 percent. October – which would traditionally be the highest-volume month of the year as retailers stock up for the holiday season – is forecast at 1.24 million TEU, up 4 percent, with November projected at 1.13 million TEU, up 3 percent.
The first half of 2010 was estimated at 6.8 million TEU, up 15 percent from the same period last year. Imports for 2009 totaled 12.7 million TEU, down 17 percent from 2008′s 15.2 million TEU and the lowest since the 12.5 million TEU reported in 2003.
“The latest economic indicators are starting to look bleak, including consumer confidence, industrial production and employment numbers,” Hackett Associates founder Ben Hackett said. “Sales will be slower in July and August; that much is certain. Inventories will rise, resulting in some sharp seasonal volume reductions.”
Hackett said some of the current surge in container volume reflects the fact that shipping companies have recently restored some of the services that were cut back during the recession of the past two years.
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