Freight continues to flow in, capacity does not
Another surge of loaded inbound containers on the way
Expectations around future freight flows continue to grow with each passing week. New records are being posted with no sign of a falloff on the horizon.
Stimulus payments are spurring along already robust consumer spending while the need to replenish inventories lingers. The combination appears likely to keep the upside of the freight cycle on track even as the year-over-year comparisons become more formidable in the back half of the year.
Inbound container forecast raised again
The National Retail Federation again raised its outlook for retail container imports to key U.S. ports. The group expects first-half 2021 twenty-foot equivalent units (TEUs) to increase 33.9% year-over-year to 12.7 million. The group’s prior forecast called for a 26.9% increase; 23.3% was the forecast before that.
The year-over-year comparisons are reflective of COVID-related interruptions in 2020, which knocked China’s manufacturing segment offline for a stretch and led to widespread domestic lockdowns that cut into freight demand.
TEUs hit a new monthly record in March, rising 64.9% year-over-year to 2.27 million. The previous monthly record was 2.21 million TEUs, which was set in October. March volumes increased 21.2% from February, which was the strongest February recorded since the NRF began tracking the data in 2002.
While April figures aren’t available yet, the NRF expects TEUs to increase 34.5% year-over-year. May (+44.9%) and June (+29.7%) round out the group’s first-half forecasts.
“Despite the continuing pandemic, most consumers are in good financial health and aren’t hesitating to spend,” said Jonathan Gold, VP for supply chains and customs policy at the NRF, in a statement announcing the improved outlook. “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.”
FreightWaves data shows inbound bookings have been at an elevated level for nearly a year now, stepping even higher in recent weeks. Ocean bookings to the U.S., measured as a 10-day-moving average of volume being tendered with ocean carriers and freight forwarders, shows that inbound traffic is coming in at a record pace. The data is forward-looking and provides insight into volumes before they depart a port of origin.
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