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05/07/2021

Retail Cargo Imports Set New Record High

With retail sales booming, retail cargo imports are also setting new record highs to keep up with demand.
cargo load

Volume of imports at retail container ports hit a new record this spring, with the first half of 2021 expected to be a third higher than 2020, according to the National Retail Federation’s monthly Global Port Tracker report. The report is compiled for NRF by Hackett Associates.

Executive Summary

The findings follow other recent reports that consumer spending rose by double-digits in April 2021 compared to the previous year, following March’s positive growth. Shoppers are feeling more confident about getting back into stores, with added stimulus money lining their pockets. 

 

“Despite the continuing pandemic, most consumers are in good financial health and aren’t hesitating to spend,” NRF Vice President for Supply Chain and Customs Policy Jonathan Gold said in a statement. “More spending translates into more merchandise arriving at our ports as retailers continue to meet increasing demand. The cargo surge that began last fall doesn’t show any sign of stopping. Unfortunately, disruption and congestion issues are also continuing.”

The report comes after retail imports were impacted earlier this year by a blockage in the Suez Canal, one of the biggest global trading routes. In March, a cargo ship, Ever Given, became lodged in the narrow canal after heavy winds pushed the vessel off course. The ship became stuck for about a week, causing major delays for many industries, including retail, and revealing new vulnerabilities in the global supply chain.

March 2021 volume of retail imports was nearly 65% higher than a year ago, when imports hit their lowest point in four years as the global Covid-19 pandemic was just emerging in intensity. U.S. ports handled 2.27 million twenty-foot equivalent units (TEU) in March this year, up from 21.2 million in February. That breaks the previous record of 2.21 TEU for a single month since NRF began tracking imports volume in 2002. 

April is projected to reach 2.17 million TEU, though the figures are not yet official. Congestion reported at the nation’s largest ports, Ports of Los Angeles and Long Beach, have begun to ease, according to NRF. However, a shortage of containers and other supplies, as well as ports working at capacity, are still causing some supply chain delays.

The growth rate may be artificially high, NRF noted, since many Asian factories went offline last year during the height of the pandemic, and many U.S. stores temporarily closed. However, 2021’s total imports is likely to outpace 2019 levels, reflecting a recovering U.S. economy. U.S. GDP grew 6.4% in the first quarter of 2021, and could hit 13% in the second quarter, according to NRF. 

“Growth that fast is a clear indication that U.S. economic output has almost recovered to its level before the pandemic struck,” Hackett Associates Founder Ben Hackett said. “Retail sales numbers show consumers are spending a large portion of their stimulus checks as well as savings that accumulated while staying home rather than going out and income from new jobs. This is turning out to be a year of super growth that will act as the driver of the global economy.”