Volumes at Southern California Ports Continue Strong Driven by Economy

 

Data for February from the southern California ports once again confirmed the continuing strength in U.S. trade and continued the positive trends in container volumes. Executives both the Port of Los Angeles and the Port of Long Beach highlighted the strong start to the year for the ports after weak 2023 volumes and the positive outlook based on the U.S. economy.

The Port of Long Beach cited cooling inflation, rising consumer confidence, and an ongoing effort to recapture market share boosted cargo shipments moving through the port in February. Similarly, the Port of Los Angeles pointed to the economy being led by job growth while noting that market confidence is strong and the cargo is flowing efficiently through the gateway.

February was the seventh month of consecutive year-over-year growth for the Port of Los Angeles. While total volume was up 60 percent over a very soft February 2023, the port also highlights that the volume is exceeding the five-year running average by 15 percent. They noted that volumes are back to pre-pandemic rates.

The growth they noted is coming in all categories for the Port of Los Angeles with a 64 percent increase in imports and a 61 percent increase in exports. It was also the ninth consecutive month of year-over-year increases in exports with the port saying that the growth was being led by volumes in agricultural products, recycled goods, and plastics.

They acknowledged that last February was softer than normal in large part due to an earlier date for the Lunar New Year but that shippers were also last year rerouting cargo away from the SoCal ports due to the protracted labor negotiations with the dock workers.

The Port of Long Beach saw similar strengths in February with an overall 24 percent increase in volumes, driven by a nearly 30 percent increase in import container volumes. Exports however lagged down 21 percent at Long Beach.

“Market confidence in our gateway is as strong as it’s ever been,” said Port of Los Angeles Executive Director Gene Seroka at today’s media briefing. “With American consumers still spending and economic indicators positive, the Port of Los Angeles is well-positioned as we move into the second quarter,” Seroka added.

He forecasted a possibly slight slowing in March with the impact of this year’s Lunar New Year celebration saying that container volumes might be around 650,000 this month. However, his overall outlook is positive with Seroka highlighting the increased movement of empties in February as shippers position boxes in Asia for future volumes. Empties volume was up 54 percent in Los Angeles last month while it was up nearly 45 percent in Long Beach.

Shippers Seroka said are closely watching the disruptions in the Red Sea/Suez Canal and the impact of the drought in Panama as well as labor negotiations for U.S. East and Gulf Coast dockworkers and the U.S. presidential elections. He said logisticians are working to determine the best routing for volumes based on the four issues overhanging the markets.

The prediction is also for a possibly slightly earlier peak season for container volumes. As in past years, shippers have advanced shipments to avoid potential delays as they also closely watch the geopolitical and other issues.