/port-congestion

Port congestion (Image: Seanews)

 

The National Retail Federation (NRF) expects imports to America's largest container ports to continue at a high level through at least February. In an update on Thursday, the group said its forecast would be even higher, but that congestion, capacity and workforce were limiting output.

“The cargo is there for larger gains at several ports but congestion issues are impacting fluid operations,” said Jonathan Gold, NRF’s vice president of supply chain and customs policy.

The final August numbers did not create a new monthly record as expected. Ports tracked by NRF handled 2.27 million TEUs in August, up 3.5% and 7.8% year-on-year, respectively. It was the second-busiest month in this data's 20-year history.

May had the highest monthly output on record of 2.33 million TEUs.

Congestion and stagnation are the reasons for August's decline.

“Just when we thought things couldn’t get any worse with the logistics supply chain, we’ve been proven wrong” said Ben Hackett, founder at Hackett Associates, which works with NRF to forecast future container throughput at ports. Hackett cited issues ranging from port closures in Asia to congestion and a lack of drivers and equipment in the US as reasons.

For months now, ships have had to wait longer at ports and freight continues to be delayed when it arrives. The lack of equipment, truck capacity and labor has affected mobility throughout the supply chain. The delay in unloading containers at the warehouse as well as the lack of industrial space to store goods has caused most points in the flow of goods to consumers.

Furthermore, high levels of consumer spending and retailers are still catching up and dragging up inventories prompting the NRF to call the current momentum will sustain through at least February, according to the month's forecast.

 

NRF-and-Hackett-Associates-Global-Port-Tracker-forecast

Containerized cargo volume imported into the US (Source: NRF & Hackett)

 

The group's preliminary expectations for September, as the numbers are not final, were for a 6.7% year-on-year increase to 2.25 million TEUs. October is forecast to be down 0.3% from a very strong gain from 2020, "when imports surged dramatically … and retailers rushed to meet pent-up consumer demand." That would be the first monthly decline since July 2020.

November (+2.9%) and December (-0.2%) are the forecasts for the year.

Growth expectations for January (+ 5.7%) and February (+1.4%) compared to the previous year; +13.2% and +23.8% in January and February 2020. Those numbers are not really affected by the COVID shutdown because it is March 2020 when factories are in Europe Asia is not working again after the Lunar New Year holiday.

The NRF's new full-year 2021 forecast has been raised by 50 basis points from last month's expectations. This year is on track to see container throughput of 26 million TEUs, up 18.1% year-on-year and a new annual record.

 

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Source: Phaata.com (According to Freightwaves)

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