Red Sea Disruptions Persist, Import Cargo Enters Winter Slowdown

Following the conclusion of the holiday season, the Global Port Tracker report from the National Retail Federation and Hackett Associates predicts a gradual decline in inbound cargo volume at major container ports across US throughout the first quarter of 2024, with a subsequent increase in the spring. 

Jonathan Gold, NRF Vice President for Supply Chain and Customs Policy, notes the traditional post-holiday slowdown in the supply chain but highlights ongoing challenges. 

Notably, recent attacks on cargo ships in the Red Sea have introduced volatility to retail supply chains, leading to longer transit times and increased costs. 

Ben Hackett, Founder of Hackett Associates, suggests that the impact of Red Sea attacks may affect East Coast ports, with some cargo rerouting to avoid disruptions. 

While additional ships can maintain capacity at East Coast ports, shippers may need to adapt supply chains to manage longer transit times. The report indicates fluctuations in TEU volumes, with potential shifts in cargo arriving at West Coast ports and subsequent transportation via intermodal rail. The industry is grappling with additional voyage costs resulting from the disruptions. 

In November, U.S. ports handled 1.89 million TEU, down from October’s peak but up compared to November 2022. December projections estimate a year-over-year increase of 9%, contributing to a total of 22.3 million TEU for 2023, down 12.8% from 2022. January anticipates a 6.1% YoY increase to 1.92 million TEU, with varying forecasts for subsequent months, influenced by factors like Lunar New Year and the impact on cargo.

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