There’s nowhere to go but up following a weak February
By Alan Wolf, YSN
Imports of appliances, furniture and other cargo at the nation’s major container ports are expected to slowly begin climbing again from February, which is estimated to be one of the lowest months in volume since the beginning of the pandemic.
That’s the word from the National Retail Federation (NRF) and advisory firm Hackett Associates in their monthly Global Port Tracker report.
“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,” said Hackett Associates founder Ben Hackett.
That aside, February is already the slowest month of the year historically due to factory shutdowns in Asia for Lunar New Year and the retail lull between the holiday season and spring shopping.
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Ports have not yet reported February numbers, but Global Port Tracker projected a 13.6% decline from January to 1.6 million 20-foot equivalent units, or TEUs (one 20-foot container or its equivalent), and an unusually large drop of 26.2% from February 2022. Last year, the impact of Lunar New Year was mitigated by congestion at U.S. ports that kept a supply of vessels waiting to unload, resulting in an artificially large year-over-year comparison.
Nonetheless, the projected decline in last month’s volume would make it the slowest for imports since May 2020, when many factories in Asia and most U.S. stores were closed due to the pandemic. Since the beginning of the pandemic, only February 2020 and March 2020 have seen lower volumes.
But Hackett sees last month as the bottom of the trough. Beginning with March, imports are expected to climb at least through mid-summer, while still remaining well below last year’s levels.
“There are many uncertainties about the economy, but we expect imports to show modest gains over the next several months,” said Jonathan Gold, NRF’s VP for supply chain and customs policy. “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.”
The good news, added Hackett, is that “While import volumes remain low, the tight labor market and strong wages are helping consumers absorb the impact of inflation and continue to spend.”
The Global Port Tracker covers the U.S. ports of Los Angeles/Long Beach, Oakland, Seattle and Tacoma on the West Coast; New York/New Jersey, Port of Virginia, Charleston, Savannah, Port Everglades, Miami and Jacksonville on the East Coast, and Houston on the Gulf Coast.