Posted on June 1, 2022
Nineteen of the nation’s top 20 ports are registering record trade this year as consumers tap into savings and credit cards to keep up their spending amid the highest inflation rate in decades, according to the latest government data.
Is this the perfect storm? Record trade, blistering growth in imports, the highest inflation in four decades, near record credit card debt, and a Federal Reserve attempting to engineer an always-difficult “soft landing” by raising interest rates assertively?
Are businesses switching from “just in time” inventory to “just in case” to counteract shortages caused by a supply chain that has yet to recover from the Covid-19 pandemic, raising the possibility they will be left holding inventory if consumers do choke on debt?
Before looking at those individual ports, it is helpful to understand just how quickly and unprecedented the increase in U.S. trade this year actually is.
U.S. imports grew 22.58% in the first quarter of 2022 when compared to the same time period of 2021, according to the latest Census Bureau data.
U.S. imports have not grown that rapidly in at least two decades, if ever. The closest growth rate to the 22.58% increase this year came 12 years ago, in 2010, as the U.S. was coming out of the worst recession since the Great Depression.
Here’s what’s important, though, and what makes the 2022 increase all the more exceptional. The 2010 increase followed a year — 2009 — when U.S. imports had fallen 30.09%. Imports did not reach the 2008 level until 2011.
The large 2022 increase does not, however, follow a large decrease like it did in 2010 — it follows a substantial 11.72% increase — making it that much more stunning and perhaps at least partially explaining the high inflation rate.
It makes sense to focus on the top 20 ports — a near-equal number of airports and seaports as well as three border crossings — since they are accounting for just under two-thirds of all U.S. imports through the first three months of the year.
Nine of those 11 are ahead of their record paces for total trade set just last year — No.1-ranked Chicago O’Hare International Airport, No. 2 Port of Los Angeles, No. 3 Port Laredo, No. 4 JFK International, No. 5 Port of Newark, No. 8 Los Angeles International, No. 10 Port of Savannah, No. 14 Port of Virginia and No. 16 Cleveland International Airport.
The only top 20 port not running at a record pace is the ninth-ranked port, Detroit’s Ambassador Bridge. Its record first-quarter total was set in 2007.
The other top 20 ports at a record pace are No. 6 Port of Houston, topping the pace set in the first quarter of 2012; the No. 7 Port of New Orleans, ahead of the 2018 total; No. 11 Port Huron in Michigan, passing the 2018 pace; No. 12 Port of Long Beach, besting the 2013 first quarter; No. 13 Port of Charleston, ahead of the 2020 total; No. 15 Buffalo Peace Bridge, topping the 2012 first quarter; No. 18 Corpus Christi, topping the 2020 total; No. 18 San Francisco International, surpassing 2019; No. 19 Miami International, running ahead of the 2013 total; and No. 20 Anchorage, ahead of 2019.
A number of these “ports,” as defined by U.S. Customs and Border Protection, the source of the Census Bureau data, combine an airport and a seaport, most prominently Chicago, Newark, New Orleans, Cleveland and Anchorage. Chicago, Cleveland and Anchorage are largely dominated by their airports while Newark and New Orleans — by the value of their trade — have a fair amount of trade associated with Liberty International and Louis Armstrong International, respectively. For that reason, I say the number of airports and seaports in the top 10 is roughly equivalent, if you exclude the two “hybrids.”
