The Port of Los Angeles reported a 5% volume increase in September moving 748,440 TEUs, according to Executive Director Gene Seroka.
Both Imports and Exports Rise
The Port reported that September 2023 loaded imports landed at 392,608 TEUs, an increase of 14% compared to the previous year. Loaded exports came in at 120,635 TEUs, an increase of 55% compared to 2022. It was the fourth consecutive month of year-over-year monthly export gains.
Empty containers totaled 235,197 TEUs, an 18.5% decline compared to last year. Combined, September volumes were 748,440 TEUs, a 5.4% increase compared to last September.
In his October 23rd media briefing Seroka explained: “On the import side, we handled 392,000 TEUs (twenty-foot container units). That's a welcome 14% increase over last September, the biggest year-on-year increase we've had in more than two years. We have seen positive trending on the export side of our business here in LA with 120,000 loaded outbound containers. September was a 55% jump compared to this time last year. That makes for four straight months of year-on-year growth and five consecutive months eclipsing 100,000 export units. There are a few factors moving the export needle. First, the most recent data available shows our top export categories with significant gains. Recyclables and animal feed were up more than 30% (as well as) vehicle parts going back to Asia.”
Volumes Still Off By 19% For 2023
Even so, Seroka conceded that volumes for the first three quarters of 2023 will be well below the same period in 2022: “With three quarters in the books, the Port of Los Angeles … processed about 6.4 million container units. That's 19% below last year and a 12% decline from our five year average ... I've outlined the factors weighing on global trades … and they begin with imports to the United States from Asia, which are down in totality 18% this year.”
Looking ahead for October 2023, Seroka said “October looks flat versus last year. While our data indicates we will see a volume uptick in both November and December … I'm confident that Q4 will be better than last year. I expect we will finish 2023 in the 8.6 million TEU range. That would be a decline of about 13% year-on-year, which is an unbelievably good comeback for where we stood in Quarter 1 … You may remember back then we were down 32%.”
Matthew Shay, President and CEO of the National Retail Federation joined Seroka on the media briefing and noted: “Our forecast … is that households will spend on average $875 per household on holiday spending this year … $620 of that $875 will be on goods, the other $255 … on consumables … decorations, food, other things to support the holidays …Our assessment is that inventory to sales ratios are really back to pre-pandemic levels.”
High Levels of Theft Hit Retailers
Shay said that the number one issue confronting U.S. retailers in 2023 is high levels of theft from stores: “The big one for us right at the moment is the challenge of organized retail crime and the impact that … theft and loss has really begun to have … in a much more substantial way than we've ever seen before. We conducted a study earlier this year … Some of those results (show) more than $112 billion in losses in 2022 due to organized retail crime theft shrink … In 2021, it … was $90 billion. But I think what people are finally starting to recognize, appreciate, and understand now … is how organized retail crime impacts communities how it hurts the workers, the team members, the associates in those businesses, how it impacts communities and customers that rely on those businesses.”
Shay said that the Retail Federation is pushing for legislation to crack down on theft but is being delayed by political gridlock including the continued delay in electing a Speaker of the U.S. House of Representatives: “Finding a solution to these challenges is really very high on our agenda. So, (we are) working with Congress to (pass)… legislation. One of those bills is the Combating Organized Retail Crime Act to really provide resources for Homeland Security, the FBI, other federal law enforcement agencies to coordinate with federal, state, local law enforcement to share information to pursue criminal gangs and enterprises. Very sophisticated operations. Not surprisingly the criminals take advantage of the same technology that legitimate businesses do.”
China Trade Hasn’t “Fallen Off a Cliff”
Seroka was asked about whether declines in trade with China would adversely impact the Port’s container volumes: “I've mentioned in this forum before that in … 2022, 57% of the imports coming through the Port of Los Angeles originated in China. Right now, through the first three quarters, it's about 53%. So, while there is a bit of a decline, it's not fallen off the cliff and China will remain a dominant trading partner in our import space for some time to come.”
Shay agreed with Seroka: “For certain categories of goods, China remains the dominant producer and you really are going to have a very difficult time shifting out of that (China) market anytime soon. So, there's going … to be evolution, but I think it's going be more gradual. We're not going (to) see something cataclysmic occur where China's no longer a dominant partner, at least not in the … near future.”
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