Savannah, GA. – February 18, 2015 – With a robust economy and a strong dollar behind a growing import market, container volume grew in December and contributed to a strong 2014. TEU (twenty-foot equivalent units) volumes grew 7.0% in the month while the year ended with overall activity at major North American ports growing 4.5%. CBRE Research watches TEU volume activity at the 13 largest ports in the U.S., Canada and Mexico and reports on the monthly and annual trends. Collectively, these ports represent over 80% of total North American volume.
Once again, the East Coast ports saw the greatest gains, growing 11.5% in December and 7.6% on the year. This is in contrast to the West Coast ports which grew 4.9% in the month and 3.2% over the year. Growth in the west coast was hampered by an ongoing dispute between the Pacific Maritime Association (PMA) and the International Longshore and Warehouse Union (ILWU) which has slowed off-loading activity at all of the West Coast ports, reducing cargo capacity by as much as 50%. The East Coast has benefited as shippers have sent an increasing number of ships through the Panama Canal to ports such as Savannah and Charleston, both of which saw double-digit growth in 2014.
Another notable piece of news from the West Coast was the initial approval from U.S. Maritime regulators for an alliance between the Ports of Seattle and Tacoma. This Seaport Alliance, which will combine the operations, planning and marketing for the two ports, isexpected to become official in the first half of 2015. Combined, these ports handle the fourth largest TEU volume in North America (behind Los Angeles, Long Beach and New York/New Jersey) but have seen their share of the overall consistently slip over recent years. In 2014, the combined volume for Seattle and Tacoma fell slightly and is in danger of falling behind Savannah in overall volume. In fact, in December, Savannah handled more TEU volume than the Seattle/Tacoma Alliance. The question is if this is sign of a permanent trend or a result of the short-term slowdown at the West Coast ports.
For inbound goods, imports have thrived as the dollar gained strength against foreign currencies. The impact of the growing purchasing power of the dollar has been especially felt in recent months as illustrated by the strong 10.6% growth of inbound TEU volume in December. The East Coast and Gulf Coast (Houston) ports led the way with 11.2%and 24.5% growth respectively though the West Coast, despite the slowdown, posted a healthy 9.6% gain. Annually, the import growth was 6.6%, with the east and Gulf Coast ports capturing the majority of the gains. Looking ahead, imports project to be a critical component of port activity as the U.S. economy is forecasted for additional expansion in2015 resulting in a strong dollar and robust consumer consumption – both metrics that are closely tied to inbound port activity.
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