Optimism is returning to local drayage carriers after a small rise in imports after consecutive months of declines.
May 22, 2023
Long Beach, California – Recently released cargo volume data from the Ports of Los Angeles and Long Beach have reignited Southern California drayage carrier’s hopes for brighter days from the doom and gloom that has shrouded the industry since cargo volumes at both ports began to fall from their May 2021 peak of 1.91 million TEUs (a measurement based on the size of a standard 20ft container).
Some importers are now choosing to route their cargo back to the Ports of Los Angeles and Long Beach from the East and Gulf Coast ports due to lower transportation costs and faster shipping times from Asia, even though no labor agreement has been reached between The International Longshore and Warehouse Union (ILWU) and the Pacific Maritime Association (PMA).
In a statement released in May 2023, Jonathan Gold, The National Retail Federation (NRF) Vice President for Supply Chain and Customs Policy, noted that consumers were still spending and that The NRF is expecting retail sales this year that would have been considered normal pre-pandemic, but without the record-setting demand levels seen in 2021 and 2022.
Volumes
Combined Port of Los Angeles and Long Beach import and export TEUs increased 4 percent beginning in December 2022 to 1.29 million TEUs from their low of 1.22 million TEUs in November 2022. Combined TEUs are still up 32 percent from the low of 967,232 TEUs at the beginning of the pandemic in March 2020 and close to December TEU levels from 2019 through 2021.
The February 2023 decline is mainly attributed to the Chinese Lunar New Year holiday, which began this year in late January and is a public holiday in China, leading to factory closures and supply chain delays throughout February and early March. This decline is seen and expected every year including the pandemic years of 2021 and 2022, although at a much smaller decline due to the boom in cargo volumes.
Excluding exports, loaded imports from overseas handled by both Southern California ports were 657,133 TEUs in April 2023, up 5 percent from the low of 623,651 TEUs in April 2020, but down 3 percent compared to loaded import TEUs handled pre-pandemic April 2019 and 2018, a sign that 2023 cargo volumes will most likely resemble pre-pandemic levels.
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