Retailers rush to get goods in ahead of possible strike at ports
Monthly inbound cargo volume at the nation’s major container ports could see a near-record surge this month as retailers bring in merchandise ahead of a potential strike at East Coast and Gulf Coast ports this fall.
That’s according to the latest Global Port Tracker report released today by the National Retail Federation (NRF) and Hackett Associates. The contract between the International Longshoremen’s Association and the United States Maritime Alliance covering East Coast and Gulf Coast ports is set to expire on Sept. 30. The ILA represents 45,000 dockworkers at three dozen U.S. ports from Maine to Texas and handle half of the nation's ocean trade.
Negotiations have broken down and the ILA has threatened to strike if a new contract is not reached by then. NRF has continued to urge the parties to return to the table to continue negotiations. Rising freight rates have also prompted importers to ship earlier.
“Many retailers have taken precautions including earlier shipping and shifting cargo to West Coast ports,” said Jonathan Gold, VP for supply chain and customs policy, NRF. “We hope to see both sides resolve this issue before the current contract expires because retailers and the economy cannot afford to see a prolonged strike.”
The potential strike comes on top of ongoing disruption issues including the attacks on commercial vessels in the Red Sea. Vessel diversions have led to increased shipping times and costs and have led to equipment shortages and congestion in Asian ports, noted Gold.
“Importers are continuing to grow their inventories and are shifting cargo to the West Coast as a precaution against potential labor disruptions,” Hackett Associates founder Ben Hackett said. “We calculate that the shift has pushed the West Coast share of cargo we track to above 50% for the first time in over three years.”
U.S. ports covered by Global Port Tracker handled 2.16 million twenty-foot equivalent Units — one 20-foot container or its equivalent — in June, the latest month for which final numbers are available. That was up 3.6% from May and up 17.7% year-over-year. That brought the total for the first half of 2024 to 12.1 million TEU, up 15% over the same period in 2023. (The totals include estimates for the ports of New York/New Jersey and Miami, which have not reported TEU counts for June.)
Ports have not yet reported July’s numbers, but Global Port Tracker projected that volume shot up to 2.34 million TEU, up 22.1% year-over-year and the highest level since the record of 2.4 million TEU set in May 2022. August is forecast to also total 2.34 million TEU, up 19.2% year-over-year.
September is forecast at 2.16 million TEU, up 6.5% year-over-year; October at 2.09 million TEU, up 1.7%; November at 1.98 million TEU, up 4.4%, and December at 1.94 million TEU, up 3.5%. Those numbers would bring 2024 to 24.9 million TEU, up 12.1% from 2023.
The import numbers come as NRF is forecasting that 2024 retail sales – excluding automobile dealers, gasoline stations and restaurants to focus on core retail – will grow between 2.5% and 3.5% over 2023.
Global Port Tracker, which is produced for NRF by Hackett Associates, provides historical data and forecasts for the U.S. ports of Los Angeles/Long Beach, Oakland, Seattle and Tacoma on the West Coast; New York/New Jersey, Port of Virginia, Charleston, Savannah, Port Everglades, Miami and Jacksonville on the East Coast, and Houston on the Gulf Coast.
