U.S. Container Ports Experience Record Growth Amid Coastal Shift

U.S. container ports recorded a remarkable 13.1% year-over-year increase in inbound volumes across the nation’s ten largest ports in November, marking the fourteenth consecutive month of growth. Total inbound volume reached 2,033,620 TEU, reflecting one of the strongest growth periods in container shipping history outside the pandemic era, according to John McCown’s latest report.

Although November volumes remain 11.1% below the record set in May 2022, the 14.7% trailing twelve-month growth rate is among the highest on record for any one year, excluding the pandemic-driven surge.

Unprecedented Volume and Value

• Inbound containerized goods across all U.S. ports totalled $185.3 billion in November.
• McCown highlighted the unusually strong and consistent growth, with the trend continuing into late 2024 despite concerns over inventory levels and supply chain challenges.

Coastal Shift Intensifies

The report underscores a continued coastal shift in container volumes, driven by labor disputes at East and Gulf Coast ports. Key factors include:

1. Labor Concerns:
   • Ongoing disagreements over port automation between the International Longshoremen’s Association (ILA) and the U.S. Maritime Alliance (USMX).
   • A three-day ILA strike in October heightened uncertainties, concluding with a temporary contract extension until January 15, 2025.
2. West Coast Surge:
   • West Coast ports have outperformed East/Gulf Coast facilities in 14 of the past 16 months, operating 10.1% above their 52-month average.
   • November saw West Coast ports achieve a 20.2% growth rate, compared to 6.0% for East/Gulf Coast ports, resulting in a significant 14.2 percentage point coastal gap.
3. East/Gulf Coast Decline:
   • East/Gulf Coast ports fell 3.4% below their 52-month average, largely impacted by labor-related challenges and shifting trade patterns.

Future Outlook

Despite potential risks of inventory buildup and supply chain disruptions, McCown’s analysis shows minimal forward-pull of volume, suggesting that the current growth trend may persist into early 2025.

• Key Opportunities: The West Coast’s performance indicates resilience and may attract further investments in infrastructure and capacity.
• Challenges for the East/Gulf Coast: Resolving labour disputes will be critical to regaining competitive ground and stabilizing growth.

With the sector poised for continued expansion, the coastal shift and robust demand for containerized goods highlight the evolving dynamics of U.S. maritime trade.