Amid escalating geopolitical tensions concerning the Suez Canal and declining water levels at the Panama Canal, one might have anticipated a decrease in U.S. imports for January. However, recent Customs filing data reveals unexpectedly robust figures.
In January, the U.S. imported 2,273,125 twenty-foot equivalent units (TEUs) of containerized goods, marking a surprising 7.9% increase from December and a 9.9% rise year over year. This 7.9% surge represents the most significant month-over-month growth for January since 2017.
Although January typically witnesses subdued activity in containerized imports, it benefits from preparations leading up to China's Lunar New Year celebrations. During the two-week holiday period, most manufacturing plants and port facilities in China suspend operations.
Consequently, there is a rush to transport goods from China to their final destinations in the weeks before Lunar New Year. A 14.9% month-over-month increase in Chinese imports indicates that seasonal patterns are unfolding as usual, in stark contrast to the lackluster performance observed in 2023.
While it's logical to assume that West Coast ports would experience the greatest influx of Chinese imports, due to their proximity, the situation didn't entirely align with this expectation. Despite the Panama Canal struggling to increase transit capacity amid a persistent drought and dry season, East and Gulf Coast ports defied projections of declining volumes.
U.S. Customs filing data indicates that imports to the Port of New York and New Jersey surged by 23,138 TEUs, or 6.8%, in January compared to December. There were also positive developments at smaller East Coast ports like Norfolk, Virginia, which saw a 5.1% month-over-month increase, and Baltimore, with a 3.4% rise in TEUs.
However, many other ports along the East and Gulf coasts experienced sluggish activity in January. The Port of Savannah, Georgia, witnessed a slight month-over-month decrease, while import volumes at the Port of Houston declined.
Southern California ports bore the brunt of the surge in Chinese imports. Notably, imports to Long Beach, California, increased by 15.1% month-over-month, while volumes at the nearby Port of Los Angeles rose by 21.1%.
This growth propelled major West Coast ports to capture a larger market share, while their East and Gulf Coast counterparts saw a decline. This shift in market dynamics occurred despite ongoing disruptions at the Suez and Panama canals.
Analysts identified various risk factors that could potentially impede growth in 2024, including the impending expiration of the labor agreement between the International Longshoremen’s Association and the United States Maritime Alliance, concerns about the health of the U.S. economy, rising port transit wait times, and the potential impact of new COVID sub variants on the global supply chain, particularly in China.
Source: www.freightwaves.com
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