February and year-to-date U.S. import volume is solid, reports S&P Global Market Intelligence

Data recently issued by S&P Global Market Intelligence pointed to United States-bound containerized freight imports posting annual gains in February, for the sixth consecutive month, following a 14-month stretch of annual declines.

February imports, at 2.44 million TEU (Twenty-Foot Equivalent Units) increased 21% compared to February 2023.

And when taking into account, the timing of the Lunar New Year, coupled with the impact of ongoing Red Sea and Panama Canal disruptions, the firm explained that U.S.-bound imports over the first two months of 2024, at 5.04 million TEU, posted a 14% annual increase over 2023's 4.40 million TEU, with 2022 and 2021, at 5.21 million TEU and 5.09 million TEU, respectively.

February consumer imports, at saw a 22% annual gain, well ahead of January's 9% increase, paced by leisure products and household appliances, with the firm observing that the Lunar New Year destocking a year ago, as well as delays in deliveries to the East Coast, due to Red Sea and Panama Canal disruptions are what it called “partial drivers.”

And it added that the true impact of delivery disruptions in consumer discretionary trade flows will not be clear until the peak shipping season. What's more, it also noted that with potentially two more weeks of delivery times to the East Coast, there is the potential for purchasing decisions to be made earlier than before, with reduced flexibility to react to demand later in the peak season.

For January and February, capital goods imports were up 12%, which Rogers said is in line with global manufacturing starting to increase after 18 months of being in a downturn. Textiles and apparel rose 5%.

In looking at the data for January and February collectively and also for February alone, S&P Global Market Intelligence Research Director Chris Rogers said much of the data is largely based on timing.

“It is not just the Lunar New Year,” he said. “It is also that this time last year, we were really in the teeth of that inventory reduction process, with all of the retailers cutting back their inventories over the downturn that really got started in August and September 2022 and only really came to an end in March 2023, with numbers now being compared to softer conditions a year ago. That is why there have been some of the big swings in the consumer goods area from last year.”

While the 14% increase to 5.04 million TEU over January and February marks a significant rebound, Rogers said that the 5.04 million TEU is in line with the same period in 2021, at 5.07 million TEU, and still well below the 2022 peak of 5.21 million TEU.

“March is when we start to see a return to what normal numbers look like, but we are being asked by customers and cargo owners if they need to be shipping earlier this year [for Peak Season], and the cargo owners are keeping their cards close on that,” he noted. “At a minimum, if you're shipping into the East Coast, you've got to go two weeks earlier than you did last year for various reasons.”

Those reasons include the ongoing Panama Canal and Red Sea issues and the upcoming elections.

Looking at the election, he described its results as asymmetric, in that those stakeholders that are worried about the potential for more tariffs in January and February 2025 pulling their shipping forward, for both seasonal and non-seasonal cargo, avoid any type of seasonal Peak Season jams.

“I see a very real chance that this year we have early shipping, and we almost see a flattening out of the shipping curve during the rest of the year,” he said. “This is all stuff which we're not going to have enough transparency on until probably July. “It is why I am telling people that they probably want to start watching the Chinese export data rather than the U.S. import data. Because, if nothing else, that's giving you your signal a bit earlier down the line. Chinese trade data gets published a bit earlier. And obviously it's at the start of the shipping routes, not the end. That's your kind of canary in the coal mine.”

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