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The biggest U.S. maritime entry for containerized goods saw import volumes stay flat in July, reflecting the uncertainty facing the trans-Pacific container shipping market.
One of the largest container shipping lines in the world has responded to the uncertainty by cutting service capacity by half over the last three months. But the start of a new service ahead of the traditional peak shipping season may mean volumes peak up again.
Separately, U.S. East Coast ports saw import volume growth thanks to the still healthy trans-Atlantic container market and shifts in to domestic and international logistics assets.
The ports of Los Angeles and Long Beach saw total imports of 789,788 twenty-foot equivalent units (TEU) in July, up less than 4,000 TEU from the year-earlier level.
The Port of Los Angeles managed to put up its best rate of import growth since March 2019, with July’s total imports up 8.7 percent from a year earlier. Neighboring Long Beach, though, experienced its third straight month of import declines, with July inbound container volumes falling 9.7 percent from a year earlier.
Long Beach Executive Director Mario Cordero said the volume decline reflects the toll of the U.S. and China trade war. The next round of 10 percent tariffs on $300 billion of Chinese goods that President Donald Trump ordered comes just as U.S. retailers are looking to ramp up purchases of goods for fall and holiday shopping periods.
“For more than a year, the supply chain has bent under the weight, and there’s very little give left,” Cordero said. “If the tariffs continue and escalate as planned next month, American consumers could see higher prices during the holiday season as businesses pass along their costs.”
Overall, the July import numbers represent at least some rebound from the dismal second quarter. Both Southern California ports saw imports drop year-on-year during May and June.
Year-to-date, total import volume at the Southern California ports are down 2.6 percent.
Some of the fall may be attributable to reduction in container services brought on by the trade conflicts in the trans-Pacific market.
In April, Ocean Network Express (ONE) reduced weekly service capacity to the International Transportation Service (ITS) terminal at Long Beachs Pier G. The move comes amid a broader streamlining of operations after its first year in business. The result has been a 50 percent reduction in weekly container volume to ITS.
ONE is expected to add another service in September, said Deputy Executive Director Noel Hacegaba, “which should help offset most of the volume deficit.”
“We are optimistic that ITS – with its outer harbor location and near-term potential for accommodating larger ships – will continue to attract new and larger services in the near future,” Hacegaba said.
Source: Los Angeles and Long Beach ports
The decrease in container volumes is also echoed in lower ship traffic through the region.
The Marine Exchange of Southern California, which distributes shipping information, said the total number of vessel calls at the two ports was 362 ships during July, under 12 per day. Captain Kip Louttit, Executive Director of the Marine Exchange, said the number of vessel calls per day is among the lowest seen since the 2014-2015 shipping season, when longshore worker strikes resulted in severe congestion.
Overall, some 1,172 container ships have called on the Southern California ports in the period between January and July 2019, Marine Exchange said, down from the 1,247 container ship calls seen over the same period in 2018.
Rail pushes up Savannah’s import volumes
The Georgia Ports Authority (GPA) said its inbound container volumes at the port of Savannah were up 8.5 percent in July to 197,341 TEU, the highest level since January 2019.
GPA Executive Director Griff Lynch said shippers are sending freight through Savannah thanks to the speed of its inland rail service, with containers going from ship to outbound rail in less than 24 hours.
Savannah is nearing completion of the first phase of the Mason Mega Rail project. The first phase will boost intermodal capacity at a Norfolk Southern container transfer facility to 500,000 container lifts annually by the end of 2019. A second phase will bring CSX’s annual lift capacity to a similar amount by 2021.
Shippers are already availing themselves of the port’s intermodal service, with rail lifts reaching 47,255 containers in July, an increase of 10.5 percent compared to July 2018.
Largest box ship ever transits the Suez Canal
Honor goes to the MSC Gulsun which can carry up to 23,000 TEU. (Marine Insight)
Port of Virginia sees second busiest month ever
July import volumes up a healthy 4 percent, but export empties up 18 percent. (Maritime Professional)
APM looks to expand small terminal in Yucatan
Port of Progreso will add container yard space, equipment, and software for near doubling of capacity. (Marine Insight)
This article first appeared on www.freightwaves.com
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