Monthly inbound cargo volume at major US container ports is expected to approach near-record levels this month, driven by retailers bringing in merchandise ahead of a potential strike at East Coast and Gulf Coast ports this fall. According to the Global Port Tracker report by the National Retail Federation (NRF) and Hackett Associates, the anticipation of labor disruptions has led retailers to expedite shipments and shift cargo to West Coast ports, reports Container News.
Labor Dispute Concerns
Jonathan Gold, NRF Vice President for Supply Chain and Customs Policy, noted that stalled contract negotiations and the threat of a strike by the International Longshoremen’s Association (ILA) have spurred these precautionary measures. The current contract expires on September 30, and with negotiations at an impasse, a strike remains a possibility. The disruption is compounded by ongoing issues, such as attacks on commercial vessels in the Red Sea, which have led to increased shipping times, costs, and congestion in Asian ports.
Retailers are shifting their cargo to the West Coast in anticipation of potential labor disruptions, with the West Coast’s share of cargo rising to over 50% for the first time in more than three years. This shift, alongside rising freight rates, is contributing to a surge in port volumes.
In June, US ports handled 2.16 million TEUs (twenty-foot equivalent units), a 3.6% increase from May and a 17.7% rise year-over-year. The first half of 2024 saw 12.1 million TEUs, up 15% from 2023. July’s volume is projected to have risen to 2.34 million TEUs, the highest since May 2022, with August expected to match this level. Forecasts for the rest of the year suggest a continued strong performance, with volumes reaching up to 2.34 million TEUs in August, 2.16 million TEUs in September, and gradually decreasing towards the end of the year.
The NRF forecasts that retail sales for 2024, excluding automobiles, gasoline, and restaurants, will grow between 2.5% and 3.5% compared to 2023. The Global Port Tracker, produced by Hackett Associates for NRF, monitors historical data and forecasts for US ports, including those on the West Coast, East Coast, and Gulf Coast.
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Source: Container News
