NRF: June Port Traffic Highest in Five Years

With the outcome of west coast port labor negotiations still up in the air, July port traffic is projected to be at the highest level in five years, according to a monthly report from the National Retail Federation.

The contract between the Pacific Maritime Association and the International Longshore and Warehouse Union expired on July 1. Thus far there has been no disruption, and both sides have said they expect to reach a settlement without impacting port operations. While there has been no contract extension, neither has there been a strike or lockout threat by either party.

The NRF report, prepared by Hackett Associates, projects import volume at major U.S. container ports will reach 1.5 million containers this month. The NRF said the surge is in keeping with a trend of unusually high import levels that began this spring as retailers began implementing contingency plans by shipping merchandise ahead of any potential problems.

“Related to the negotiations, we’ve seen an uptick in imports to both the west and east coasts as companies bring in products earlier than normal,” said Jonathan Gold, vice president of supply chain and customs policy for the NRF. Gold added the year-to-date volume increase has been 4% compared to 2013, partly due to economic improvement.

He said he has heard from many NRF members who have been operating under contingency plans for months due to the threat of a labor stoppage. “They have to make sure if it does occur, they can get product to market,” Gold said.

A joint report by the NRF and the National Association of Manufacturers, published in June, estimated a west coast port strike could cost the U.S. economy up to $2.5 billion per day.

Overall, west coast container traffic was up 5.7% in May compared to the same period in 2013, while east coast traffic surged 7.1%, the NRF report stated. Traffic to the port of Houston was up 17.5%. The monthly report monitors container traffic at 14 U.S. shipping ports.