Inbound cargo volume at major container ports across the U.S. is expected to drop to the lowest level in nearly three years this month as retailers remain cautious about the state of the economy, the National Retail Federation said Wednesday.
“With the U.S. economy slowing and consumers worried by rising interest rates and still-high inflation, retailers are importing less merchandise,” NRF Vice President for Supply Chain and Customs Policy Jonathan Gold said in releasing NRF’s Global Port Tracker report. “February is traditionally a slow month, but these are the lowest numbers we’ve seen in almost three years. Retailers are being cautious as they wait to see how the economy responds to efforts to bring inflation under control.”
U.S. ports covered by Global Port Tracker handled 1.73 million TEUs in December, the latest month for which final numbers are available. That was down 2.6% from November and down 17.1% from December 2021.
December’s volume brings 2022’s annual total to 25.5 million TEU, down 1.2% from the all-time record of 25.8 million TEU set in 2021, but still well above pre-pandemic levels. Multiple monthly records in the first half of last year helped to offset significant drops in the second half.
“In some ways, 2023 is reminiscent of 2020, when the world’s economies shut down because of the pandemic and no one had a clue where we were headed,” said Ben Hackett, founder of Hackett Associates which produces the Global Port Tracker report for the NFF. “Cargo volumes are down, and the economy is in a contradiction of rising employment and wages that promise prosperity at the same time high inflation and rising interest rates threaten a recession. The economy is far from shut down, but the degree of uncertainty is very similar.”
Last year’s busy start to the year will translate into some big monthly declines in the first half of this year.
The report projects January volumes at 1.78 million TEU, down 17.6% year over year. February is forecast at 1.57 million TEU, down 25.6% from the same month last year for the slowest month since 1.53 million TEU in May 2020, when many factories in Asia and most U.S. stores were closed by the pandemic. Since the beginning of the pandemic, only February and March 2020 came in lower, the NRF points out.
March is forecast at 1.76 million TEU, down 24.8% year over year, April at 1.87 million TEU, down 17.3%, and May at 1.92 million TEU, down 19.9%. June is forecast at 2 million TEU, the first time imports are expected to be that high since October, but down 11.3% from last June.
These numbers would bring the first half of 2023 to 10.9 million TEU, down 19.4% from the first half of 2022. This means there will a lot of catching up to do in the second half if inbound cargo volumes stand a chance of coming anywhere close to the levels of the past two years.
Sign up for our newsletter