Port of Savannah Sees Signs of Market Correction
Cargo volumes through the Port of Savannah tumbled more than 7 percent in September in part due to impacts related to Hurricane Ian. Even so, the port closed out the quarter handling nearly 10 percent more cargo than it did a year ago.
“A high number of ad hoc vessel calls, the addition of three new Mediterranean services, and one new service to Asia contributed to the growth,” said GPA Executive Director Griff Lynch. “Additionally, our regular services have been arriving with significantly more cargo destined for Savannah.”
The Georgia Ports Authority handled more than 1.5 million TEUs in the first quarter of its Fiscal Year 2023 for an increase of 135,000 TEUs, or 9.6 percent over the same period last year. GPA’s fiscal year runs from July through June.
Lynch said the average vessel exchange grew from 3,500 TEUs per ship this time last year, to 4,500 TEUs across the past three months. The Port of Savannah handled 776,067 TEUs of loaded and empty exports in the first quarter, while import trade totaled 766,525 TEUs. Loaded containers represented 70 percent of the total container trade, the GPA said.
In intermodal rail, GPA grew lifts 6.4 percent in the first quarter. Counting all rail cargo moved through Garden City Terminal, the Appalachian Regional Port and GPA’s pop-up container yards, rail lifts totaled nearly 146,000 for the three-month period, an increase of 8,775.
The Georgia Port Authority said it expects growth to moderate in the coming months.
“While we have seen powerful growth across the first quarter, we are beginning to see signs of correction in the market,” Lynch said, noting that September container volumes were off by 7.6 percent compared to the same month last year, at 436,279 TEUs. A nearly three-day suspension of vessel service related to Hurricane Ian impacted September volumes at the Port of Savannah.
Savannah’s September numbers are further confirmation that the days of heady pandemic-fueled growth are behind us and stand in stark contrast to August, when the port had its best month ever with volumes up 18.5% compared to the same month in 2021.
According to a report earlier this week, U.S. imports in September fell by a precipitous 11 percent as a slowing economy, retailers reducing purchases, inflation and high fuel costs have finally started to catch up to import throughput numbers at U.S. ports. Still, import volumes continued to remain above pre-pandemic levels last month.
GPA Board Chairman Joel Wooten said the outlook for the rest of the calendar year is strong, but moderated compared to the rate of growth experienced over the past two years.
“We’re expecting a gradual easing in demand based on several factors, including a shift in the balance of consumer spending away from goods and back to services, and the impact of inflation on the economy,” Wooten said. “After having increased trade at a compound annual growth rate of 14 percent over the past two fiscal years, this change will represent a return to a more typical rate of growth for GPA.”
On a positive note, an easing of demand should help U.S. ports address vessel backlogs brought on by unprecedented import volumes, Lynch said. The Port of Savannah expects to clear the need for vessels to wait at anchor by the end of November. Currently, approximately 204,600 containers are on the water headed for Savannah, down from a high of 262,500 in July.
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