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Import volume recovering at U.S. ports

Published: May 12, 2015
According to the monthly Global Tracker Report released May 8 by the National Retail Federation and Hackett Associates, import cargo volume at major U.S. retail container ports is returning to normal levels as ratification of a new West Coast labor agreement nears.

 

“Dockworkers and management made a massive push to clear the backlog of cargo over the past several weeks and West Coast ports are getting back to normal despite concerns such as the Teamster picketing seen in Los Angeles and Long Beach earlier this month,” says Jonathan Gold, NRF vice president of supply chain and customs policy. “We hope to see this month’s ratification vote go smoothly and then settle into a long period of efficient, dependable operations before we have to think about contract talks again. But there are still plenty of other issues impacting congestion that the ports need to work through.”

 

Last February, the Pacific Maritime Association and the International Longshore and Warehouse Union reached tentative agreement on a five-year contract. ILWU leadership recommended ratification, but votes won’t be tallied until May 22. The agreement is relieving critical congestion at West Coast ports.

 

Ports covered by Global Port Tracker handled a record 1.73 million 20-foot equivalent units (TEU) in March, the latest month for which numbers are available, driven by a surge of backlogged cargo still riding at anchor after the labor dispute.

 

The first half of 2015 is forecast at 8.8 million TEU, an increase of 6 percent over the same period in 2014.

 

Hackett Associates founder Ben Hackett says the strong increases in volume are coming as ship owners are launching an excessive number of large new vessels, which could spark a price war on shipping rates.

 

“This upsets the supply/demand balance,” Hackett says. “There is not enough demand to justify this level of capacity increase. Expect rates on both coastal services to fall to all-time lows.”