February Descartes Global Shipping Report highlights solid annual and sequential import growth

The new edition of the February Global Shipping Report, which issued this week by Waterloo, Ontario-based Descartes, a provider of logistics based on-demand, software-as-a-service offerings, saw annual and sequential gains, for United States-bound import volumes, driven, in large part, by imports from China.

This is the 30th edition of the Global Shipping Report, going back to its debut in August 2021.

From December to January, Descartes reported that U.S.-bound container import volumes rose 7.9%, to 2,273,125 TEU (Twenty-Foot Equivalent Units). And on an annual basis, it found that January volumes were up 9.9%, while posting a 9.6% increase compared to pre-pandemic 2019’s 2,036,393 TEU tally. What’s more, the report noted that the 7.9% sequential increase, from December to January, marked its biggest gain for that period over the last seven years.

Chris Jones, EVP Industry Descartes, the report’s author, wrote that a 14.9% increase in imports from China to the U.S. drove these increases, with the Port of Los Angeles and the Port of Long Beach benefitting from that activity.

“The combination of the Panama drought and Middle East conflict is beginning to impact transit times as delays at the top East and Gulf Coast ports increased considerably,” wrote Jones. “The February update of the logistics metrics Descartes is tracking shows accelerated container import volume amid signs that global supply chain performance could be impacted throughout 2024 because of conditions at the Panama and Suez Canals and upcoming labor negotiations.”

For the top 10 U.S. ports, Descartes found the U.S. container volume saw a strong 8.4% increase, from December to January, rising 8.4%, or 149,906 TEU, with six ports posting gains, led by the Port of Los Angeles, with a 21.1%, or 77,085 TEU, increase, followed by the Port of Long Beach, up 15.1%, or 48,054 TEU, and the Port of Tacoma, up 12.2%, or 5,831 TEU. On the other end, the Port of Houston, was off 3.6%, or 6,042 TEU, and the Port of Charleston was down 4.1%, or 4,331 TEU.

January coastal volume share was paced by the West Coast ports, with the Ports of Los Angeles and Long Beach leading the way. West Coast ports’ share of total volume increased to 43.0%, for a 3.3% gain over December, with the top East and Gulf Coast ports falling 2.5%, to 42.4%. And when comparing the volume share for the top 10 ports to smaller ports, Descartes said that share for the top 10 ports eked out a 0.9% increase to 85.4% compared to December 2023.

For the top 10 countries of origin, Descartes reported that U.S. container import volume in January saw a 9.6% increase, or 146,240 TEU, over December, with China leading the way, up 14.9%, or 117,084 TEU, and Germany seeing the largest decline, down 4.9%, or 2,851 TEU.

China’s total U.S. import tally, from December to January, rose 14.9%, or 905,173 TEU, 9.8% behind the August 2022 high, said Descartes. And China accounted for 39.8% of total U.S. container imports in January, up 2.7% compared to December and off 1.7% compared to the February 2022 high of 41.5, while marking the highest percentage of U.S. imports over the last two years.

Port transit delays, which are measured in days, were up in January, with the top West Coast ports all up, except for the Port of Los Angeles, which was off slightly, from 5.0 to 4.9. The Port of Long Beach increased from 4.7 in January to 5.4 in December. On the East Coast, the Port of New York/New Jersey went from 8.0 in December to 10.6 in January.

The report cited various issues the global shipping sector need to monitor in 2024, including:

• potential labor disruption at South Atlantic and Gulf Coast ports, with the current labor agreement between the International Longshoremen’s Association (ILA) and United States Maritime Alliance (USMX) set to expire at the end of September;
• challenges with the Panama Canal drought and pending ILA contract negotiations pointing to further trade flow disruptions;
• should monthly TEU volumes come in between 2.4M-to-2.6M TEU, Descartes said it will continue to stress ports and inland logistics until infrastructure can be enhanced;
• port transit wait times decreasing serving as an indication of improved global supply chain efficiencies capabilities or that the demand for goods and logistics services is declining;
• the continuing impact of the pandemic, with the spread of COVID subvariants adding uncertainty to the trajectory of the pandemic;
• the overall health of the economy, with various indicators conflicting;
• Panama Canal-based trade flow, with the combination of the drought impacting capacity and the recently ratified International Longshore and Warehouse Union (ILWU) potentially accelerating the redirection of the one million TEUs that shifted from the West Coast ports during the pandemic; and
• the Middle East conflict, with attacks on shipping in the Red Sea by Houthis from Yemen potentially causing carriers to forego the Suez Canal, extending transit times and negatively impacting global shipping capacity