Shipping Growth Slows at U.S. East Coast Ports
Georgia and Virginia ports are seeing cargo expansion level off after big gains earlier in 2015 amid labor strife on the West Coast
Growth in shipping-container volumes at the Port of Savannah slowed to 10.3% in July from 23.2% in June. PHOTO: ASSOCIATED PRESS
The red-hot growth in shipping volumes at some East Coast ports appears to be slowing as the hampering effects of the labor strife that hit West Coast ports earlier this year recede.
Growth in shipping container volumes at the Port of Savannah slowed to 10.3% year-over-year in July, compared with 23.2% in June, according the Georgia Ports Authority.
The total number of twenty-foot equivalent units, or TEUs, a common measure of container volumes, fell 2%, to 324,242, from June to July at the port, mainly the result of a fall-off in exports. Import growth, however, is slowing as well. Loaded containers of imported goods passing through the Port of Savannah grew by 16.4% in July, when compared with the same month a year ago. That rate fell from 38.8% in June and an average of 33.9% for the first six months of the year.
At the Port of Virginia, year-over-year TEU volume grew 8.8% in July, compared with 14.5% in June and a monthly average of 10.3% since the start of 2015, according to port statistics.
Starting late last year, labor strife slowed or stopped work entirely at several West Coast ports, leading to long lines of ships in the harbors at the neighboring ports of Los Angeles and Long Beach. Terminal owners and the dockworkers’ union agreed to a new contract in late February, but not all West Coast ports have fully recovered: Inbound container volume at the Port of Los Angeles fell 3.5% year-over-year in July.
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Delays on the West Coast prompted some of the country’s largest importers, including Wal-Mart Stores Inc. and Lowe’s Cos. Inc., to reroute cargo to the East and Gulf Coasts, leading to gains that many ports hoped would be long-lasting.
“I think some people got carried away on how much volume was permanently shifting away from the West Coast,” said Walter Kemmsies, chief economist at Moffatt & Nichol, a maritime infrastructure advisory. “Very little of what shifted away is going to stay permanently on the East Coast.”
Mr. Kemmsies forecasts that East Coast port volume growth will slow to between 5% and 8%, based on his broader forecast of economic expansion. “Anything that comes above that rate is not really driven by the economy, it’s driven by costs savings efforts or other issues,” he said.
The Port of New York and New Jersey, America’s third-busiest port, is expected to publish July results later this month.
