U.S. ports are expected to remain “near record volume,” according to the monthly Global Port Tracker report released today by the National Retail Federation (NRF) and consulting firm Hackett Associates.
The NRF said on Wednesday that the increase in volume is attributed to retailers working to meet “still-strong consumer demand” and also protect themselves against “potential disruptions” at West Coast ports.
“We’re in for a busy summer at the ports,” NRF VP for supply chain and customs policy Jonathan Gold said in a statement. “Back-to-school supplies are already arriving, and holiday merchandise will be right behind them.”
Gold said that the “big wild card” is what will happen with West Coast labor negotiations with the current contract set to expire on July 1. “We continue to encourage the parties to remain at the table until a deal is done, but some of the surge we’ve seen may be a safeguard against any problems that might arise,” Gold added.
According to Hackett Associates founder Ben Hackett, imports from China should start to grow again now that the government has relaxed its Covid Zero policy and begun to release the population of Shanghai from a months-long lockdown. “The anticipation is that the Chinese manufacturing and transportation sectors will quickly get back to normal,” Hackett said. Nonetheless, “China’s recovery will need the government’s support in order to get the supply chain functioning normally again to provide the input required by the manufacturing sector.”
U.S. ports covered by Global Port Tracker handled 2.26 million Twenty-Foot Equivalent Units (TEU) – one 20-foot container or its equivalent – in April, the latest month for which final numbers are available, the report said. That was down 3.6% from March’s 2.34 million TEU – the record for the number of containers imported in a single month since NRF began tracking imports in 2002 – but up 5.1% year over year.
Ports have not yet reported May numbers, but Global Port Tracker projected the month at 2.31 million TEU, down 0.9% from 2.33 million TEU in May 2021, the second-busiest month on record. June is also forecast at 2.31 million TEU, up 7.5% year over year, which would leave May and June tied for the third-highest volume.
July is forecast at 2.3 million TEU, up 4.8% from last year; August at 2.28 million TEU, up 0.2%; September at 2.13 million TEU, down 0.4%, and October also at 2.13 million TEU, down 3.8%.
This report comes as some retailers are making moves to “right-size” their inventory after over-ordering on categories they were previously in need of or even having too much of the wrong product that consumers didn’t want.
Just yesterday, Target made the announcement that it would implement markdowns, remove excess inventory, and canceling orders as it looks to unload a surplus of stock in its supply chain. The news sparked Target’s stock to drop 5 points on Tuesday. The stock recovered slightly on Wednesday, ending the day up 0.72 points, but dipped 0.20 points in after market trading.