Holiday season import outlook is promising, says Port Tracker

Despite the presence of still-high inventory levels, typical seasonal patterns appear to be intact for United States-bound retail imports, according to the most recent edition of the Port Tracker report issued today by the National Retail Federation (NRF) and maritime consultancy Hackett Associates.

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, 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.

“Shoppers are right in the middle of buying back-to-school products but the retail supply chain is already preparing for the holiday season,” NRF Vice President for Supply Chain and Customs Policy Jonathan Gold said in a statement. “August is the peak month of the annual shipping season that builds up to the winter holidays, and a lot of the merchandise consumers will be buying this fall is already showing up at the docks.”

For June, the most recent month for which data is available, total volume was 1.63 million Twenty-Foot Equivalent Units (TEU), which was down 2.8 percent from May and 0.5 percent ahead of June 2015.

July was pegged at 1.64 million TEU for a 1.5 percent annual increase. And for August, traditionally the highest import month of the year, imports are expected to hit 1.68 million TEU, which would be down 0.3 percent, with September at 1.61 million TEU, which is a 0.6 percent decline. October is calling for a 4.9 percent gain at 1.63 million TEU, with November and December at 1.52 million TEU (a 2.9 percent increase) and 1.47 million TEU (a 2.5 percent increase), respectively.

For all of 2016, Port Tracker is calling for a 1.6 percent annual increase.

“Bless the U.S. consumer. In these stressed times with uncertainty abounding amid an unusual presidential election and other issues, consumers have decided it is time to hit the stores and stock up on goods,” Hackett Associates Founder Ben Hackett wrote in the Port Tracker report. “Retail sales were up at roughly twice the rate of growth in wage increases in June and the increased spending was supported by a sharp rise in new jobs, according to the Labor and Commerce departments.

“The other point of interest is that market shares between the two coasts are continuing to shift back to what they were prior to the labor dispute,” wrote Hackett. “The East Coast projection for the year remains positive but still below one percent growth. The projection for the whole of North America for 2016 is 1.6 percent growth, a reflection of the slowdown of global trade. A note of concern remains in the continuing high level of inventories. This is a large part of the reason behind the muted level of the peak shipping season and the relatively slow growth in import volumes. A lot of shipping capacity is missing even with the peak season. The shipping alliances are managing to toe the line with regard to capacity management and are avoiding market share battles. Next April, this will become even more apparent as the four alliances evolve to three, allowing even more room for capacity management. Freight rates will likely go up from their extreme low levels.”