Stability Predicted for American Port Traffic

Container volume at U.S. ports is expected to grow next year, but at a slower rate of three to four percent, down from five percent in 2015, says ratings company Moody's.

Since longshoremen wrapped up contract negotiations with port operators in early 2015, container volume at U.S. West Coast ports has risen quickly. Those ports experienced significant delays in 2014, and some of the growth this year is attributable to a clearing of that backlog, analysts say.

Now that the logjam has cleared and China's export economy has begun to slow, growth in 2016 is predicted to be positive but modest. China accounts for about one third of container moves worldwide, much of that volume destined for American ports; the official growth rate of Chinese industrial production hit a seven month low in October (the latest figure available), although it remains positive at five percent.

Low oil prices, low container shipping rates, a stable labor situation and a strong dollar should contribute to steady U.S. port volumes, Moody's said.

Speaking to media, American importers suggested that problems at U.S. ports are not all resolved, and that the labor disputes of last year still have an impact. Logistics managers at major U.S. retailer Target still build a much longer lead time into their orders to offset any port delays, they say. Consultant Dean Tracy told IHS-JOC that terminal congestion, container trailer chassis availability, and drayage operator shortages were still a concern. Truck drivers at some American ports, notably at Los Angeles / Long Beach on the U.S. West Coast, have been engaged in on-and-off strikes and legal disputes with operators for some time.

“Slow volumes cover sins,” Tracy said. “When volumes pick up, the issues that have plagued the terminals and the carriers will resurface again.”