Little Relief Anticipated for Retailers as Cargo Volume Expected to Remain High; Jonathan Gold and Ben Hackett Discuss
WASHINGTON, DC - Despite ongoing efforts to quell shipping challenges, further hurdles are expected for buyers and suppliers as imports have set another record high this spring. As peak shipping season begins, congestion and port labor pose issues, especially for retailers.
“Cargo volume is expected to remain high as we head into the peak shipping season, and it is essential that all ports continue to operate with minimal disruption,” National Retail Federation (NRF) Vice President for Supply Chain and Customs Policy Jonathan Gold said. “Supply chain challenges will continue throughout the remainder of the year, and it is particularly important that labor and management at West Coast ports remain at the bargaining table and reach an agreement.”
The contract between the International Longshore and Warehouse Union and the Pacific Maritime Association expired July 1, but cargo operations have continued, a release stated.
According to NRF and Hackett Associates’ monthly Global Port Tracker report, ports saw a surge in activity this spring as slowdowns in cargo from Chinese factories caused by COVID-19 gave an opportunity to clear congestion. During that time, retailers brought in seasonal merchandise and other goods to avoid potential problems created by negotiations.
The United States ports covered in the Global Port Tracker handled 2.4 million Twenty-Foot Equivalent Units (TEU)—one 20-foot container or its equivalent—in May. That was an increase of 6 percent from April and 2.7 percent year-over-year. That number also set a new record for the number of containers imported in a single month since NRF began tracking imports in 2002.
Ports have yet to report June numbers, but Global Port Tracker projected the month at 2.25 million TEU, up 4.8 percent from last year. July is forecasted at 2.31 million TEU, up 5.3 percent from last year.
“Congestion of ships waiting to berth on the West Coast has eased, and we expect to see the same on the East Coast as carriers begin to return to their normal patterns of port calls,” Hackett Associates Founder Ben Hackett said. “After a short period of decline, freight rates are on the rise again as congestion in Europe and idle vessels there take capacity out of circulation.”
To read more insights from the Global Port Tracker report, click here.
As more port updates become available, AndNowUKnow will share the latest information.