Port Tracker report points to an eventual slow pickup in import volumes

While lower United States-bound import volumes have been a recurring theme over the last several months, the new edition of the Port Tracker report, which was issued today by the National Retail Federation (NRF) and maritime consultancy Hackett Associates, pointed to a potential rebound, for imports, in the coming months.

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.

“There are many uncertainties about the economy, but we expect imports to show modest gains over the next several months,” NRF Vice President for Supply Chain and Customs Policy Jonathan Gold said in a statement. “Growth is a positive sign, but levels are still far below normal and retailers will remain cautious as they work to keep inventories in line with consumer demand.”

For January, the most recent month for which data is available, Port Tracker noted that import volumes, for the ports covered in the report, came in at 1.81 million TEU (Twenty-Foot Equivalent Units), for a 4.4% increase compared to December and a 16.5% annual decrease. And while February data is not in yet, the report said volumes are pegged to come in at 1.56 million TEU, for a 13.6% sequential decline and what it called an “unusually large” 26.2% annual decrease, which would represent the lowest-volume month going back to May 2020 (the only months with lower volumes are February 2020, at 1.51 million TEU, and March 2020, at 1.37 million TEU), which was heavily impacted by the pandemic, with several factories in Asia and many U.S.-based stores closed.

What’s more, the report added that, the pandemic aside, February is traditionally the slowest month of the year, due to the Lunar New Year factory shutdowns in Asia, coupled with a slow period for retailer in between the holiday season and spring shopping. It also pointed out that in February 2022 the Lunar New Year was largely impacted by U.S. port congestion, which resulted in a high number of vessels that were waiting to unload at ports and brought about “an artificially large” annual comparison for February 2023.

Port Tracker issued projections for the subsequent months, including:

• March, at 1.74 million TEU, for a 25.9% annual decrease;
• April, at 1.87 million TEU, for an 17.2% annual decrease;
• May at 1.92 million TEU, for a 19.7% annual decrease
• June, at 2 million TEU, for an 11.5% annual decrease (which would mark the first time imports are estimated to be that high going back to October 2022); and
• July, at 2.13 million TEU, for a 2.5% annual decrease

The report said the imports for the first six months of this year are expected to come in at 10.9 million TEU, for a 19.5% annual increase. In 2022, total import volume—at 25.5 million TEU—was 1.2% off the annual record set in 2021, at 25.8 million TEU.

“Retailers are maintaining reduced inventories in anticipation of rebuilding with new seasonal stock once they have a clearer take on expected levels of consumer spending,” wrote Hackett Associates Founder Ben Hackett in the report. “We also see increasing mortgage rates and rent eating into disposable income at a time when the Federal Reserve is continuing to try to slow inflation by increasing interest rates. While import volumes remain low, the tight labor market and strong wages are helping consumers absorb the impact of inflation and continue to spend. What cannot be ignored is the declining volume of imports at the major ports, which have seen some dramatic year-over-year reductions as carriers offer a mix of ‘blanked’ sailings, changes in ports of call and removal of capacity by increasingly laying up ships.”