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Coronavirus Outbreak Sends February Cargo Import Forecast Down

Cargo imports at U.S. container ports most commonly used by retailers are expected to see a sharper-than-usual drop in February, with the coronavirus causing longer factory shutdowns for China’s Lunar New Year.

“February is historically a slow month for imports because of Lunar New Year and the lull between retailers’ holiday season and summer, but this is an unusual situation,” said Jonathan Gold, vice president for supply chain and customs policy at NRF. “Many Chinese factories have already stayed closed longer than usual and we don’t know how soon they will reopen. U.S. retailers were already beginning to shift some sourcing to other countries because of the trade war, but if shutdowns continue, we could see an impact on supply chains.”

The Chinese government had already extended the official Lunar New Year by an extra week to Feb. 2. For factories, workers were set to be back at their posts from Monday, but there have been reports that the holiday extension could last longer still to help quell further spread of the virus.

“Projecting container volume for the next year has become even more challenging with the outbreak of the coronavirus in China and its spread,” Hackett Associates founder Ben Hackett said. “It’s questionable how soon manufacturing will return to normal, and following the extension of the Lunar New Year break, all eyes are on what further decisions China will make to control the outbreak.”

U.S. ports covered by Global Port Tracker handled 1.72 million 20-foot equivalent units (TEU) in December, a 1.8 percent increase from November, but down 12.4 percent from unusually high numbers at the end of 2018 ahead of a scheduled tariff increase that was ultimately postponed, the Global Port Tracker report released Monday by the National Retail Federation (NRF) and Hackett Associates, said. A TEU is one 20-foot-long cargo container or its equivalent.

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December’s numbers brought 2019 to a total of 21.6 million TEU, a 0.8 percent decrease from 2018 amid the ongoing trade war, but still the second-highest year on record. January container deliveries were estimated at 1.82 million TEU, down 3.8 percent from a year earlier.

February shipments are forecast to be down 12.9 percent year-over-year at 1.41 million TEU and March is expected to be 9.5 percent below year-ago levels at 1.46 million TEU. Several major ocean freight carriers have reported “blank sailings”—or sailings that have been cancelled by the carrier—from China. Before the coronavirus outbreak, Global Port Tracker had forecast February at 1.54 million TEU and March at 1.7 million TEU, putting the impact at 8.4 percent for February and 14.1 percent for March.

While the duration and impact of the coronavirus outbreak remain unknown, April industry cargo reaching U.S. ports is, for now, forecast to be up 4.5 percent to 1.82 million TEU, May is seen rising 8.3 percent to 2 million TEU and June shipments are projected to be ahead 8.5 percent to 1.95 million TEU. Those numbers would bring the first half of 2020 to 10.47 million TEU, down 0.4 percent year-over-year.

Global Port Tracker provides historical data and forecasts for the U.S. ports of Los Angeles-Long Beach and Oakland, Calif., and Seattle and Tacoma, Wash., on the West Coast; New York-New Jersey; Port of Virginia; Charleston, S.C.; Savannah, Ga., and Port Everglades, Miami and Jacksonville, Fla., on the East Coast, and Houston on the Gulf Coast.