US Cargo Imports Down 19% in May

Date: Tuesday, July 11, 2023
Source: Sourcing Journal

Import cargo volume at major U.S. ports is expected to peak in August and should finally lap year-ago numbers come the holiday season, according to the Global Port Tracker report released by the National Retail Federation (NRF) and Hackett Associates.

U.S. ports covered by the Global Port Tracker handled 1.93 million 20-foot equivalent units (TEUs) in May, the latest month for which final numbers are available—down 19.3 percent year over year but up 8.5 percent sequentially from April.

Ports have not yet reported June numbers, but the tracker projected the month at 1.86 million TEUs, down 17.5 percent year over year.

July is forecast to have a rebound at 1.94 million TEUs, down 11 percent year over year, and August is forecast at 2.03 million TEU, down 10.1 percent year over year. August would mark the first month since October 2022 to reach 2 million TEUs.

The projections say peak shipping season will hit its summit in August as expected, but will start catching up to last year’s totals in the fall. September forecasts indicated the ports would handle 1.96 million TEUs, down just 3.4 percent from the 2022 period. October’s anticipated 1.97 million TEUs represent a decline of 1.8 percent, while November’s 1.88 million TEUs would be up 5.9 percent for the first year-over-year increase since June 2022.

As port activity is expected to heat up, many are concerned about how Canada’s West Coast port strike could impact goods movement.

“We were relieved that labor and management at West Coast ports reached a tentative agreement last month but that doesn’t mean supply chain disruptions are over,” said Jonathan Gold, vice president for supply chain and customs policy, NRF. “The port strike affecting Vancouver and Prince Rupert shouldn’t have a major impact here, but could affect some U.S. retailers whose merchandise comes in through Canada and could have a potential ripple effect at other ports.”

Canada’s Vancouver and Prince Rupert ports handled over 185,000 TEU in May, accounting for approximately 9 percent of combined U.S.-Canadian container imports at ports covered by the full Global Port Tracker report.

Gold also shared his qualms about a potential UPS strike as 340,000 workers still have not signed a new labor contract.

“The ability to move goods from U.S. ports to stores could be impacted if UPS and the Teamsters don’t resolve their differences before their contract expires at the end of the month,” Gold said. “Seamless supply chains are critical for retailers as we head into the peak shipping season for the winter holidays.”

Demurrage fees see steep decline

Despite all the supply chain challenges, there’s good news for shippers worried about idle cargo sitting at the ports.

Average demurrage and detention charges have fallen 25 percent year over year in 2023, to $2,008 per container per day from $2,692 in 2022. On a three-year basis, these fees have sunk 14 percent, according to a recent report from container logistics platform Container XChange.

The lower demurrage fees come as the Federal Maritime Commission (FMC) continues investigating the practices of ocean carriers and terminal operators, and whether current policies in place are fair to shippers.

“A key factor in determining whether you must pay detention charges is the efficiency of your processes and monitoring,” said Christian Roeloffs, co-founder and CEO of Container Exchange. “How quickly can you act and notify your agent or trucker if something goes wrong, such as a container being forgotten at the terminal? Timely communication is crucial in avoiding unnecessary charges. This holds true in any market situation.”

North American ports have the costliest demurrage and detention fees, with New York/New Jersey ($2,478 per container per day), Oakland ($2,325) and Los Angeles ($2,069), taking the top three spots.

However, the North American ports all report fees that are lower than 2020 totals, which cannot be said for 11 global hubs. Antwerp and Rotterdam out of Europe; Dubai’s Jebel Ali; and east Asian ports including Ningbo, Kelang, Shenzen, Singapore, Tianjin, Xiamen, Hong Kong and Guangzhou all have higher fees than they did three years ago.

In April 2023, major carriers like Maersk, Mediterranean Shipping Co. (MSC), HMM, and Hapag-Lloyd waived these surcharges on weekends and holidays when terminals are closed.

Roeloffs believes demurrage and detention should be subject to free market forcs, but noted, “perhaps what needs regulation is the clarity on when the clock starts. Establishing clear time stamps and determining who bears the burden of proof in cases of congestion, where a container cannot be picked up, would be crucial. Payment should only commence once the terminal is able to release the container. These aspects warrant attention and potential regulation.”


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