US retailers will not let up on their ordering binge this summer, projecting Wednesday that import volumes will remain at record or near-record levels through August.
With the retail inventories-to-sales ratio near 30-year lows, retailers are scrambling just to replenish their inventories, let alone building stock to prepare for the busy back-to-school and holiday shopping seasons.
The message to ocean carriers, ports, railroads, truckers, warehouses, and equipment providers is that they must marshal their assets and expand capacity in order to handle container volumes through the 2021 peak shipping season or the congestion issues they have dealt with since last summer could get worse as that peak season approaches.
“We’ve never seen imports at this high a level for such an extended period of time. Records have been broken multiple times, and near-record numbers are happening almost every month,” Jonathan Gold, vice president for supply chain and customs policy at the National Retail Federation, said in the April Global Port Tracker released Wednesday.
Global Port Tracker, which is published monthly by the NRF and Hackett Associates, said that during the 13-month period from Aug. 1, 2020, through Aug. 31, 2021, imports are projected to have been at or above 2 million TEU in 11 of the 13 months. Before 2020, monthly imports had reached 2 million TEU only once, in October 2018, Global Port Tracker said.
The retail inventories-to-sales ratio in January was 1.19, the lowest since 1992, according to the US Census Bureau. The NRF projects the consumer spending spree will continue at least through the summer.
“Between federal stimulus checks and money saved by staying home for the better part of a year, customers have money in their pockets, and they’re spending it with retailers as fast as retailers can stock their shelves,” Gold said.
Import volumes are projected to continue to be strong in the coming months, both in real terms, and especially when compared with the same months last year when retailers were just beginning to recover from the shutdown of the US economy due to the coronavirus disease 2019 (COVID-19).
Global Port Tracker expects imports for March to come in at 2.07 million TEU, up 50.7 percent from March 2020, which was the slowest month of that year. Imports are projected to be 1.99 million TEU in April, up 23.4 percent year over year; 2 million TEU in May, up 30.6 percent; 2.01 million TEU in June, up 24.9 percent; and 2.04 million TEU in July, up 6.5 percent.
Imports in August will exceed 2 million TEU at a robust 2.08 million TEU, but will be down 1.2 percent year over year, retailers forecast. August was the second-busiest month of 2020, surpassed only by October, according to Global Port Tracker.
Source: Journal of Commerce