There’s no doubt about it… The Port of Long Beach is seeing reduced cargo.
Softened consumer spending, increased prices driven by inflation and a shift in trade routes to West and East Coast ports contributed to a dip in cargo moving through the Port of Long Beach in January, the port said in releasing its January 2023 cargo update.
Dockworkers and terminal operators there moved 573,772 TEUs in January, down 28.4% from January 2022, which was the ports busiest January on record.
Imports decreased 32.3% to 263,394 TEUs and exports declined 14.2% to 105,623 TEUs. Empty containers moving through the port were also down 29% to 204,755 TEUs.
The soft numbers are hardly a surprise. Descartes Systems reported last week that U.S. container imports dipped below pre-pandemic levels in January for the first time since early in the COVID-19 crisis. The National Retail Federation has also declared that container shipping’s pandemic-driven surge has come to an end with inbound cargo headed to the lowest level in nearly three years as retailers remain cautious about the state of the economy.
“We are taking aggressive steps to meet a new set of challenges for the new year,” said Port of Long Beach Executive Director Mario Cordero. “I remain optimistic that we will recapture market share and develop projects that will enhance our long-term growth, sustainable operations and the reliable movement of goods through the Port of Long Beach.”
Cordero here is referring to the fact that West Coast ports like Los Angeles and Long Beach have lost market share over the last year to East and Gulf Coast ports as shippers shifted cargo east to avoid congestion delays and concerns over possible labor unrest as dockworkers negotiate a new labor contract with West Coast port employers.
Descartes’ report from last week shows that West Coast ports are making some headway in regaining at least some market share lost over the last year. In reality, however, West Coast ports have been losing market share fairly steadily for the last six years, since the expansion of the Panama Canal in late 2016.
“We’re confident we will grow cargo volume by working with our industry stakeholders,” said Long Beach Harbor Commission President Sharon L. Weissman. “We are focused on investing in infrastructure projects that will improve air quality and make us more competitive.”
The Port of Long Beach said while economists indicate inflation is slowing for purchased goods and may offset rising prices for services, the shift back to goods from services largely depends on how the Federal Reserve adjusts interest rates this year.
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