By Siddharth Cavale and Lisa Baertlein
NEW YORK- Retailers are fueling a summer rush of imports to the United States this year as companies guard against a potential strike by port workers and ongoing shipping disruptions from attacks in the Red Sea ahead of a shortened holiday shopping season.
Container imports and freight rates surged in July, signaling an earlier than usual peak season for an ocean shipping industry that handles about 80 percent of global trade.
July is expected to be the peak for US retailers, which account for about half of that trade, and August is expected to be almost as robust, analysts said.
Companies that import toys, home goods and consumer electronics have brought forward holiday promotions to capture customers who are shopping earlier each season. “Retailers don’t want to be caught back-footed,” said Jonathan Gold, the National Retail Federation’s (NRF) vice president for supply chain and customs policy.
Many shippers expedited holiday goods orders, with some putting Christmas items on the water as early as May, said Peter Sand, chief analyst at pricing platform Xeneta.
The influx is not a result of consumer spending, which has been tethered by stubborn inflation and high interest rates, experts said. Rather, it is a precaution against a potential US port strike and the late Nov. 28 date for Thanksgiving this year, squeezing the peak shopping and delivery season running to Christmas Eve.
In July US container imports registered the third-highest monthly volume on record with 2.6 million 20-foot equivalent units (TEUs), up 16.8 percent from a year earlier, in part owing to record imports from China, according to supply chain software provider Descartes Systems Group.
The NRF, which is chaired by the CEO of Walmart’s US business and includes the CEOs of Target Macy’s and Saks on its executive committee, said it also expects strong August imports. Walmart, the nation’s largest container shipping importer, reports second-quarter earnings on Aug. 15.
Retailers are concerned about a possible Oct. 1 strike at seaports stretching from Maine to Texas after talks between the International Longshoremen’s Association and the United States Maritime Alliance stalled.
Maersk on Friday outlined the consequences of potential strike disruption at US ports.
“Should a general work stoppage occur on the US Gulf and East Coasts, even a one-week shutdown could take 4-6 weeks to recover from, with significant backlogs and delays compounding with each passing day,” Maersk said in a US market update.
Non-contract spot rates for a container going from the Far East to the US West Coast jumped 144 percent between the end of April and start of July but have since fallen 17 percent, with similar trends seen in container routes to the US East Coast and into northern Europe and the Mediterranean, according to Xeneta.
