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Home » Sea container import volume seen spiking in June as retailers race ahead of labor talks
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Sea container import volume seen spiking in June as retailers race ahead of labor talks

June 6, 2014
DC Velocity Staff
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Import volume at major U.S. container ports is expected to spike next month to peak shipping season levels as retailers move goods into the United States early to avoid possible service disruptions in the event of labor unrest at West Coast ports, according to a monthly report released today by the National Retail Federation (NRF) and consulting company Hackett Associates.

U.S. ports followed by the report, known as "Global Port Tracker," handled 1.43 million twenty-foot equivalent units (TEUs) in April, the latest month for which final numbers are available. The number was up 9.9 percent from March and 10.3 percent from April 2013. One TEU is one 20-foot cargo container or its equivalent.

Volumes in May are estimated at 1.47 million TEU, up 5.8 percent from May 2013 levels, and June is forecast at 1.46 million TEU, up 7.5 percent from last year. Both are volume numbers not normally seen until August, which in recent years has become the peak season for seagoing U.S. imports arriving for the holiday season. July is forecast at 1.51 million TEU, up 4.4 percent from last year. August is forecast to come in at 1.52 million TEU, up 1.9 percent from 2013.

Over the past five years, including this year, May and June volumes each averaged 1.37 million TEUs, while August has averaged 1.45 million TEUs, NRF said. October had been the traditional peak month until a 10-day lockout in October 2002 shut down all West Coast ports, paralyzed import flows and created backlogs that took months to clear.

Since then, retailers have been pulling their orders and deliveries forward so that August is now the peak. The practice has continued even in years when a contract was not up for negotiation, according to Craig Shearman, NRF's head of government affairs.

The Pacific Maritime Association (PMA), which represents waterfront management, and the International Longshore and Warehouse Union (ILWU), which represents dockworkers, began contract negotiations last month to replace the current pact that expires June 30. Importers have reportedly begun making contingency plans to divert freight to East and Gulf Coast ports either through the Panama or Suez Canals. However, Ann Bruno, chief operating officer of logistics firm Icat Logistics Inc., who two years ago helped companies develop similar plans during a protracted contract dispute between the International Longshoreman's Association (ILA) and ship management, said at the end of May that she's heard nothing from importers about cargo diversions in the event of a work stoppage out west.

West Coast ports handle more than two-thirds of U.S. retail container cargo, including the bulk of the cargo from Asia.

Ben Hackett, founder of Hackett Associates, said inventory levels rose earlier in the year as bad winter weather kept shoppers at home while retailers began stocking up in advance of the port talks. However, inventories are being drawn down as the warm weather brings out more shoppers, Hackett said.

"Global Port Tracker," which is produced for NRF by Hackett Associates, covers the ports of Los Angeles/Long Beach; Oakland; Seattle and Tacoma; New York and New Jersey; Hampton Roads; Charleston; Savannah; Port Everglades; and Houston.

Transportation Maritime & Ocean Global Logistics
KEYWORDS Hackett Associates National Retail Federation
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