Cargo imports remained strong in October, setting new “peak-season” records as retailers stocked up stores and warehouses for the holiday season, and met new demands for quick delivery of online orders, according to the monthly Global Port Tracker report released Wednesday by the National Retail Federation (NRF) and Hackett Associates.
“The pandemic has made the past year one of the most trying the supply chain has ever seen, but retailers have met that challenge,” Jonathan Gold, vice president for supply chain and customs policy for NRF, said. “We’ve gone from not knowing whether we would be able to get merchandise from China to having a surplus of goods when stores were closed to having to meet pent-up demand as consumers returned. At this point, retailers have seen a successful holiday season so far and goods are reaching the shelves. We hope 2020 is a one-time experience, but we’ve learned a lot.”
Hackett Associates founder Ben Hackett said the retail inventory-to-sales ratio soared to 1.68 in April, when most stores were closed, then plummeted more than 25 percent to 1.22 in June and has remained at about that level since then. That drove record imports as retailers replenished inventories and prepared for the holidays.
“With inventories low but demand growing, we have witnessed a surge in imports as retailers try to keep up,” Hackett said. “The dramatic shift to online shopping coupled with the expectation of next-day delivery is also spurring the growth of imports at warehouses for major online sellers, who need to have enough stock on hand not just to meet demand but to meet it instantly.”
U.S. ports covered by Global Port Tracker handled 2.21 million 20-foot equivalent units (TEU) in October, a 17.6 percent year-over-year increase and up 5.2 percent from 2.11 million TEU in September, the previous record for a single month since NRF began tracking imports in 2002.
October’s number brought the total for the “peak season”–the period from July through October when retailers rush to bring in merchandise for the winter holidays–to 8.3 million TEU. That was an increase of 8.8 percent over the same time last year and beat the previous record of 7.7 million TEU set in 2018.
Even with most holiday merchandise already in the country, November imports remained strong at an estimated 2.07 million TEU, a 22.4 percent jump year-over-year and the fourth-busiest month on record. December is forecast to rise 11 percent over last year to 1.91 million TEU.
As recently as a month ago, 2020 was expected to total 20.9 million TEU, a drop of 3.4 percent from last year and the lowest annual total since 20.5 million TEU in 2017 based on low imports earlier this year, the report noted. But with the recent string of record months, 2020 is now expected to come in at 21.8 million TEU, up 0.8 percent over 2019. That would tie 2018 as the busiest year on record.
January cargo imports are forecast at 1.86 million TEU, up 2.4 percent from a year earlier, while February shipments are seen rising 2.6 percent year over year to 1.55 million TEU. Cargo imports for March at projected to increase 17.8 percent to 1.62 million TEU compared to March 2020, when factories in China failed to reopen after the Lunar New Year holiday due to the COVID-19 outbreak, and April shipments are forecast at 1.74 million TEU, up 8.3 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.