Port Tracker: Six Percent Drop Now Projected for 2008 Retail Container Traffic
WASHINGTON, September 9, 2008: Cargo volume at the nation's major retail container ports is now expected to decline 6 percent in 2008 compared with 2007 as the nation's slow economy continues to prompt merchants to carefully manage their inventories, according to the monthly Port Tracker report released today by the National Retail Federation and Global Insight.
Volume is projected to total 15.5 million Twenty-Foot-Equivalent Units for the year, compared with 16.5 million TEU in 2007. The estimate is down from 15.8 million projected in August, which would have been a 4 percent decline from 2007. Cargo volume each month this year has been below the same month last year, and is expected to continue to be below last year's levels in each remaining month. Year-over-year increases previously expected in October and December are no longer anticipated. One TEU is one 20-foot container or its equivalent.
"Retailers are tightening up their inventories to reflect what they expect to be able to sell during the holiday season," NRF Vice President for Supply Chain and Customs Policy Jonathan Gold said. "We still expect to see an increase in sales this year, but the economy is clearly challenging and our industry is trying to hit the balance point between supply and demand as closely as they can."
U.S. ports surveyed handled 1.32 million TEU in July, the most recent month for which actual numbers are available. The number was up 2.6 percent from June but down 8.3 percent from July 2007.
August was estimated at 1.38 million TEU, down 5.8 percent from a year ago, and September is forecast at 1.35 million TEU, down 8.6 percent, with October at 1.4 million TEU, down 2.9 percent. October should be the peak month of the year, though it will fall short of the 1.48 million TEU peak for 2007 set last September. November is forecast at 1.3 million TEU, down 5.3 percent, and December at 1.27 million TEU, down 0.4 percent.
Meanwhile, Port Tracker's congestion rating for the Ports of Los Angeles and Long Beach has been raised to medium because of new regulations that will require trucking companies seeking to do business there to obtain a special concession license beginning October 1.
"Uncertainty about the initial implementation of the Clean Trucks Program raises concerns about potential truck capacity for these ports," Global Insight Economist Paul Bingham said. "There is some risk for port performance associated with this program, but the ports say they have received letters of intent from several trucking companies and say they believe operations can go forward without interruption."
The remainder of the U.S. ports covered by Port Tracker – Oakland, Seattle and Tacoma on the West Coast; New York/New Jersey, Hampton Roads, Charleston and Savannah on the East Coast, and Houston on the Gulf Coast – are rated "low" for congestion, the same as last month.
Port Tracker, which is produced by the economic research, forecasting and analysis firm Global Insight for NRF, looks at inbound container volume, the availability of trucks and railroad cars to move cargo out of the ports, labor conditions and other factors that affect cargo movement and congestion. The report is free to NRF retail members. Subscription information is available at www.nrf.com/PortTracker or by calling (202) 783-7971. Non-NRF members can contact Global Insight Director of Business Development Diana Wyman at (202) 481-9265.
The National Retail Federation is the world's largest retail trade association, with membership that comprises all retail formats and channels of distribution including department, specialty, discount, catalog, Internet, independent stores, chain restaurants, drug stores and grocery stores as well as the industry's key trading partners of retail goods and services. NRF represents an industry with more than 1.6 million U.S. retail establishments, more than 24 million employees - about one in five American workers - and 2006 sales of $4.7 trillion. As the industry umbrella group, NRF also represents more than 100 state, national and international retail associations. http://www.nrf.com.
Global Insight Inc. is a privately held company that provides comprehensive economic and financial information available on countries, regions and industries, using a unique combination of expertise, models, data and software within a common analytical framework to support planning and decision-making. Through the world's first same-day analysis and risk assessment service, Global Insight provides immediate insightful analysis of market conditions and key events around the world, covering economic, political, and operational factors. The company has over 3,800 clients in industry, finance, and government with revenues in excess of $105 million, more than 690 employees and 25 offices in 14 countries covering North and South America, Europe, Africa, the Middle East, and Asia. http://www.globalinsight.com.
NRF: J. Craig Shearman / (202) 626-8134 / [email protected]
Global Insight: Paul Bingham / (202) 481-9216 / [email protected]
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