Posted on July 12, 2022
The National Retail Federation is reporting that imports reached a new record high in May at U.S. ports, and despite concerns about the strength of the U.S. economy and new potential disruptions to the supply chain, they are forecasting that imports have plateaued at high levels of the remainder of 2022. The retail trade association is forecasting the imports will approach 25 million TEU at the end of 11 months putting them on track for another record year in 2022.
“Cargo volume is expected to remain high as we head into the peak shipping season, and it is essential that all ports continue to operate with minimal disruption,” said Jonathan Gold, the Vice President for Supply Chain and Customs Policy at the NRF. “Supply chain challenges will continue throughout the remainder of the year, and it is particularly important that labor and management at West Coast ports remain at the bargaining table and reach an agreement.”
U.S. ports covered by the Global Port Tracker report handled 2.4 million TEU in May, setting a new record for the number of containers imported in a single month over the 20 years the NRF has been tracking imports. The May total was up six percent from April and up 2.7 percent year-over-year according to the report. It surpassed the previous record of 2.34 million TEU calculated by the NRF for March 2022.
The NRF highlights two factors contributing to the record in May. They said that ports saw a surge in activity this spring as a slowdown in cargo from Chinese factories closed by COVID-19 gave the port operators a chance to clear built-up congestion. Retailers were also bringing in seasonal merchandise and importing other goods early to avoid any problems related to the ongoing contract talks for longshore workers at West Coast ports.
“Congestion of ships waiting to berth on the West Coast has eased, and we expect to see the same on the East Coast as carriers begin to return to their normal patterns of port calls,” said Ben Hackett, founder of Hackett Associates which prepares the monthly report. “After a short period of decline, freight rates are on the rise again as congestion in Europe and idle vessels there take capacity out of circulation.”
The Global Port Tracker projects that June’s imports will be down slightly from May at 2.25 million TEU, but that level will be up 4.8 percent from 2021. They are forecasting that imports in the first half of the year will total 13.5 million TEU, a 5.4 percent increase year over year.
For the second half of 2022, they are expecting that July will rebound to 2.31 million TEU before the monthly volumes plateau for the remainder of the year. The project calls for the monthly volumes to range between 2.06 and 2.26 TEU.
The NRF notes that the year-over-year declines during the second half of the year contrast with unusually high numbers during the same period in 2021. Despite a slowing in growth, they believe that the full year is still expected to achieve a net increase over 2021.