Panjiva reports continued shipment growth for April

United States-bound waterborne shipments saw some growth in April, albeit not at the same levels it hit in previous months, according to data issued this week by global trade intelligence firm Panjiva.

April shipments, at 955,956, saw a 0.3% gain compared to April 2017, getting annual shipment growth back on a positive track, following March’s 0.2% annual decline. March’s annual decline was the first one going back to a 7.7% annual drop-off in February 2017.

Panjiva research director Chris Rogers said in an interview that the growth in container shipments in recent years has been driven by strong, underlying economic fundamentals, coupled with people not being worried, or yet to see the effect of what he called protectionist rhetoric.

“What we see more is that business sentiment is beginning to worsen [to a degree] but not as much as in the past,” he said. “And we definitely have seen a step back in shipments from China. That is not directly related to tariffs on shipments from China being implemented but rather to concerns that tariffs ‘might’ be implemented. One could argue that the mixture of nervousness, coupled with sensible supply chain strategies, could lead to less growth. But things are a long ways from not growing as much as in the past, as opposed to [shipment levels] actually falling. It is possibly a sign of more to come, with signs of a summer slowdown, much like what has occurred over the past two years.”

Looking at specific shipment groups, Rogers observed that slow, or lessening, shipment growth reflects an ongoing going of business sentiment in April, which he noted explains the “continued lackluster performance” of capital goods, which rose 0.7% in April on the heels of a 2% decline in March. This serves as an indication that purchasing managers may not be as optimistic as they have been in the past and making decisions accordingly.

Panjiva also pointed out that absent a marked improvement in confidence, it may be forthcoming protectionist measures against China that drive the next move in the direction of imports.

While U.S.-bound waterborne shipments saw a strong run of growth largely from the second half of last year through February of this year, Rogers said it is worth keeping in mind that there was a similar pattern globally and was not a U.S.-only trend, adding that the global growth rate also started to slow down early in 2018.

“We have seen in data from organizations like the World Bank, the International Monetary Fund and others that says the economy is still growing but at a slower rate, and the huge risk of protectionism remains around the corner if China and the U.S. don’t step back from the brink,” he said.