Record slump in US container imports in February Ship’s crew

The top 10 container ports in the US posted their biggest monthly decline on record in February, reflecting the dramatic boom-to-bust cycle brought on by the COVID-19 pandemic.

Inbound container volumes to the U.S. fell by a “staggering” 28% last month, a “significant deterioration” compared to the 17% drop in January and the fifth consecutive month of double-digit percentage declines, says liner industry veteran John McCown latest US ports report.

“Hard comparisons to last year’s unprecedented annual gains are now leading to unprecedented annual declines, and this will continue for at least a few months,” McCown writes in his report.

The boom-to-bust cycle can be seen in the chart below, which shows the percentage year-over-year changes in US container imports.

Credit: John McCown

McCown notes that February volumes represent a negative 1.4% compound annual growth rate (CAGR), or compounded growth rate over time, compared to pre-pandemic levels in February 2019 and only a positive CAGR of 1 % since 2017 Impact of former President Trump’s trade war tariffs on China. “Both rates are well below the 10-year CAGR of 3.8% of annual inbound cargo from 2010 to 2020, which excludes pandemic-induced gains,” McCown said.

Once again, East and Gulf Coast ports outperformed West Coast ports in percentage change in February — a 21-month streak — as ongoing negotiations over labor conditions in West Coast ports continue to help the move incoming volumes eastward, McCown said.

There was some good news for exporters in February as volumes out rose 4.6% after posting double-digit gains in January and December. “After 26 months of underperformance, outbound volume growth actually exceeded inbound volume growth for the seventh straight month,” McCown’s report reads.

McCown concludes his report by addressing “misinformation” related to price levels and trends in container shipping and maritime supply chains. He specifically points to the New York Fed’s Global Supply Chain Pressure Index (GSCPI), which he says provides an “erroneous barometer” due in part to the use of spot indices that do not accurately track the container shipping industry.

As gCaptain reported earlier this month, the latest reading from GSCPI shows that pressure on the global supply chain eased significantly in February, even turning negative (the lowest since August 2019), suggesting conditions in the global have normalized the supply chain again.

“Correlation to a spot index, which is neither a relevant measure of actual inflation in the container sector nor a measure of supply chain pressures, is a strong indictment of the GSCPI. The GSCPI is now giving the false positive that supply chain prices are lower than before the pandemic,” McCown says.

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