July US Import Volume Edges Higher, Ports Say

2014-09-05

Containerized import volume to the U.S. likely rose in July from June as moderate economic growth took hold, according to port and maritime executives.

July import volume gains were mostly limited to Gulf and East Coast ports, given hushed activity on West Coast docks. Port labor negotiations there detracted from overall inflows, port and ocean carrier spokespeople told MNI. Talks between the International Longshore and Warehouse Union, which represents nearly 20,000 West Coast dock workers, and the Pacific Maritime Association of terminal operators and shipping lines, have been ongoing since May. The ILWU’s six-year contract expired on July 1 and dockworkers have remained on the job since then. Many observers have noted positive progress in the talks and do not expect a strike or labor lockout. East Coast ports have likely benefited from some related cargo diversions.

In July, the latest month for which port data are available, containerized import volume fell in July from June at the nation’s two largest ports, Los Angeles and Long Beach. Imports were about flat at three other West Coast ports – Oakland, California, Portland, Oregon and Seattle, Washington. Portland’s auto import units tumbled by nearly 19% from June, according to port data. Elsewhere, boxed import volume rose at the Port of Houston Authority, the South Carolina port of Charleston and by more than 20% at the Georgia port of Savannah.

“There is a generally upbeat opinion that this peak season will be strong due to economic improvement,” Jim MacLellan, director of trade services at the Port of Los Angeles, told MNI.

He also described as “positive news” last week’s announcement of a tentative Longshore deal on healthcare benefits, which he said was “one of the key challenges in negotiations.”

Art Wong, spokesman for the L.A.’s sister port of Long Beach, said that even Southern California ports’ soggy performance in July was better than expected.

“This is typical in years when they’re negotiating. It gets a little quieter here while they’re settling a new contract,” he said, but added, “I’m surprised it was as good as it was.”

According to Wong’s calculations, L.A. and Long Beach ports combined saw containerized import and export volume each edge less than one percent lower from a year ago. Compared to June, July imports fell about 5% and exports lost 7%.

“It doesn’t look like there are the kind of hostilities there have been in the past,” he said of the contract negotiations.

On upcoming peak-season shipments ahead of holiday shopping, Wong said he expects volumes to kick higher at the end of September and through October, especially if a broader labor deal is reached.

“We’ve been getting calls all summer about the negotiations. But anybody who’s still concerned about that can now probably start placing their orders for the peak season.”

At the heart of the relative resilience of U.S. imports, Wong said, is the repairing U.S. economy.

“It’s pretty clear that the signs here are for steady growth. It seems pretty solid.”

On the export side, Wong said, China’s uneven growth pace may be having a similar effect on outbound U.S. shipments of the raw materials and components that Asian manufacturers need to churn out consumer products. Southern California ports’ outbound volumes have been choppy, he said.

From the ocean carriers’ perspective, cargo is growing at a moderate clip.

“Generally, there’s been an overall increase in the market,” said Niels Erich, spokesperson for the Transpacific Stabilization Agreement, a group of 15 major ocean carriers that hauls over 90% of the boxed cargo moving eastbound between Asia and the U.S.

The fairly gentle response to the contract uncertainty “again points to the stronger market,” Erich said.

“Ships have been pretty much full over June and July via the East Coast. We see very high vessel utilization numbers into August, and in September the forward bookings look good.”

Erich said the TSA carriers’ current, though “uncertain,” forecast is for 3% to 4% growth in eastbound trans-pacific trade volumes this year, unchanged from earlier forecasts.

According to a preliminary estimate by the National Retail Federation and Hackett Associates, the 12 largest U.S. ports saw 3.4% growth in import volume in July from June and a chunkier 5.8% jump versus July, 2013.

Container volumes are only one portion of the U.S. trade picture and do not reflect the dollar value of those boxed goods. Commodities that travel in bulk, oil that moves via tanker, heavy equipment that rolls on and off ocean vessels, and cargo that moves by air are not included in container counts.

Source from : MNI

HEADLINES