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Increased container volume expected at LA, LB, Oakland and other major US container ports, says new report

WASHINGTON, DC – 06/10/08 – After months of depressed cargo volumes, US ports may soon see an upturn in business, according to a new report issued by the National Retail Federation (NRF) and research firm Global Insight.

“The nation’s continuing economic slowdown will keep cargo traffic at major retail container ports below last year’s levels through this summer and early fall, but month-to-month numbers are climbing and ports should see a return to year-over-year growth by Halloween,” the report said.

“The numbers are still below last year but they are steadily climbing,” NRF Vice President for Supply Chain and Customs Policy Jonathan Gold said. “That’s in line with forecasts that the economy could begin its slow recovery this fall and reflects retailers’ sales expectations for the holiday season.”

US ports surveyed handled 1.26 million Twenty-Foot-Equivalent Units (TEU) of container traffic in April, the most recent month for which actual numbers are available. That’s up 8.9% from March, which registered the lowest volume in two years, but down 4.7% from April 2007.

May was estimated at 1.3 million TEU, down 5.7% from a year ago, and June is forecast at 1.34 million TEU, down 8.1%. July is forecast at 1.4 million, down 2.8%; August at 1.46 million, down 0.3%; and September at 1.43 million, down 3.1%.

The NRF forecast for October predicts a volume of 1.48 million TEU, a 2.7% increase that would represent the first year-to-year rise since July 2007, when 1.44 million were handled compared with 1.4 million in July 2006.

The Port of Oakland loads and discharges more than 99% of the containerized goods moving through Northern California, the nation's fourth largest metropolitan area.

Last year, the Bay Area port handled a total of 2,387,911 TEU, down 0.2% from 2006.

In March, Oakland had 177,569 TEUs move through its terminals, down 5.7% from the same month last year, while April saw a slight rise of 1.3% to 190,419. Through the end of April, the port handled 735, 264 TEU, down 1.1% from the same period last year.

Despite the slump, however, Oakland's cargo volume continues to rank it as the fourth busiest container port in the country with almost 60% of its business with Asia.

The adjacent ports of Los Angeles and Long Beach ports, which together form the largest port complex in the country, currently account for more than 40% of international trade shipments to and from the country.

Peak volumes at the two ports, the report said, are expected to be near last year's levels, and the report does not anticipate any disruptions to port activity as a result of either the ongoing dockworker labor negotiations or a scheduled truck replacement program.

The truck program calls for both ports to inaugurate a $2.2-billion clean air plan to gradually replace most of the diesel trucks in the harbor with more environmentally friendly rigs.

Last month, the Envionmental Protection Agency honored the ports of Los Angeles and Long Beach with its Clean Air Excellence Award for the truck plan and their overall strategy to reduce air emissions from their cargo-handling activities.

Two years ago, the Los Angeles and Long Beach harbor commissions approved the Clean Air Action Plan, a blueprint to reduce port-related pollution by 45% by 2011.

Combined, California's three major container ports carry approximately half of the country’s total container cargo volume.

In addition to Los Angeles, Long Beach, and Oakland, the other ports surveyed for the report include Seattle and Tacoma on the US West Coast; New York/New Jersey, Hampton Roads, Charleston and Savannah on the US East Coast, and Houston on the US Gulf Coast.

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