Retail Imports Could Hit Record High Despite Slowing Growth
The rate of import growth at the nation’s major retail container ports has begun to slow after double-digit surges earlier this year, but volume should nonetheless hit an all-time high by the end of the summer, according to the monthly Global Port Tracker report released by the National Retail Federation and Hackett Associates.
“Year-over-year comparisons are slowing down but that’s largely because we had some unusual numbers early this year and strong volume in the second half of last year,” said Jonathan Gold, NRF vice president for supply chain and customs policy. “Despite that, we’re expecting some of the largest import volumes we’ve ever seen, and that’s because retailers are responding to strong consumer demand.”
Ports covered by Global Port Tracker handled 1.61 million Twenty-Foot Equivalent Units in April, up 4.8% from March and 11.3% from April 2016. May was estimated at 1.69 million TEU, up 3.9% from the same time last year. June is forecast at 1.64 million TEU, up 4.1% from last year; July at 1.68 million TEU, up 3.5%; August at 1.74 million TEU, up 1.6%; September at 1.64 million TEU, up 2.8%; and October at 1.69 million TEU, up 1.3%.
April’s 11.34% year-over-year figure and a 15.8% year-over-year increase in March were unusually high anomalies because of where Lunar New Year fell on the calendar and affected production at factories in Asia-Pacific. The first half of 2017 is expected to total 9.6 million TEU, up 6.4% from the first half of 2016. Cargo volume for 2016 totaled 18.8 million TEU, up 3.1% from 2015, which had grown 5.4% from 2014.
NRF has forecast that 2017 retail sales–excluding automobiles, gasoline and restaurants–will increase between 3.7-4.2% over 2016, driven by job and income growth coupled with low debt. Cargo volume does not correlate directly with sales because only the number of containers is counted, not the value of the cargo inside, but nonetheless provides a barometer of retailers’ expectations.
“We can assume that part of the reason for the lower-than-expected increase was due to continuing slow growth in the Western Hemisphere,” said Ben Hackett, founder of Hackett Associates. “Retail sales continue to hold up but nothing coming out of Washington suggests an impetus to growth.”