Retail Traffic Still Slow, but Should Pick Up Somewhat This Month

Import cargo volume at the nation’s major retail container ports is expected to increase 2.6% in October over the same month last year and should reach its highest level of the year as retailers stock up for the holiday season, according to the monthly Global Port Tracker report from the National Retail Federation and consulting firm Hackett Associates.

“After a summer of trying to compare apples to oranges, retail cargo is back to normal,” says Jonathan Gold, NRF’s vice president for supply chain and customs policy. “October is the historic peak of the shipping cycle each year, and retailers are bringing merchandise into the country on their usual schedule and at normal levels again instead of being forced to move cargo early. Retailers are poised to succeed in maintaining the careful balance between inventory and sales that keeps customers happy while keeping retailers profitable.”

U.S. ports followed by Global Port Tracker handled 1.32 million twenty-foot equivalent units (TEUs) in August, the latest month for which after-the-fact numbers are available. That was the same as July, but down 7% from August 2010. One TEU is one 20-foot cargo container or its equivalent.

The August figures followed year-over-year declines of 5% in June and 4% in July, but the statistics were skewed because of higher-than-normal numbers in 2010 when fears of shortages in shipping capacity caused many retailers to bring holiday merchandise into the country earlier than usual. Global Port Tracker counts only the number of cargo containers imported, not the value of their contents, so cargo volume does not directly correlate with retail sales. Actual retail sales were up during the summer, and NRF is forecasting 2.8% growth in holiday sales this November and December over last year, for a total of $465.6 billion.

Year-over-year cargo growth resumed but was weak in September, which was estimated at 1.37 million TEUs, up 2.7% from last year. October is forecast at 1.39 million TEUs, up 2.6% from last year, and is expected to regain its historical position as the busiest month of the year after last year’s usual patterns shifted the peak to August. November is forecast at 1.28 million TEUs, up 4% from last year, and December is forecast at 1.18 million TEUs, up 2.7%. January 2012 is forecast at 1.16 million TEUs, down 3.6% from January 2011, and February, traditionally the slowest month of the year, is forecast at 1.1 million TEUs, down 3.8%.

The total for 2011 is forecast at 15 million TEUs, up 1.8% from 2010. Imports during 2010 totaled 14.7 million TEUs, a 16% increase over unusually low numbers in 2009.

Hackett Associates founder Ben Hackett is optimistic despite mixed economic data. “General economic indicators are giving us a mixed set of signals,” Hackett says. “Yet at the same time there are indications that things are not quite that bad. We are of the opinion that the probability for economic growth is high than the probability of recession.”

Global Port Tracker, which is produced for NRF by Hackett Associates, covers the U.S. ports of Long Angeles/Long Beach, 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.

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