Southern California ports continue to recover their volumes from their lows in early 2023, while reporting they expect continued gains through the end of the year due to the strength of the U.S. consumer. Both Los Angeles and Long Beach are starting to post a string of months of year-over-year gains, with both imports and exports improving.
Despite Asian holidays and carriers’ continued use of empty sailings to manage capacity, both ports reported September as a good month, with Long Beach also reporting its busiest September on record. However, at the end of the nine months, year-to-date transshipment volumes in both ports remain at 20 percent compared to 2022.
In Long Beach, where more than 829,000 TEUs passed through the port, it was the third straight month of increases and the highest monthly total since June 2022. They cited strength in consumer spending and a new labor contract, reporting a nearly 12 percent annual increase -an increase compared to the year and the first monthly increase in transshipment in the port year-on-year in 14 months. Long Beach’s strength came from a more than 19 percent increase in import volumes, while exports declined by more than 10 percent.
The neighboring port of Los Angeles, however, showed unusual separation between the two neighboring ports as it experienced an expected nearly 10 percent decline in volumes on a month-over-month basis. However, Los Angeles was still able to report a five percent increase over 2022 and its second straight month of year-over-year gains.
Imports into Los Angeles are back on 2022 levels, up 14 percent, which the port highlights as its largest year-over-year profit increase in more than two years. Exports also increased for the fourth month in a row and for the fifth month, exceeding 100,000 TEU. Fueled by strong growth in exports of recyclables, animal feed and vehicle parts, the Port of Los Angeles handled 55 percent more exports than the previous year. They also pointed out that the decline in empty volumes makes it easier for U.S. exporters to ship goods from the port.
While both ports expect the weak peak season to continue, they forecast improvement through the last quarter of 2023. “We look forward to moderate cargo volume growth through the end of the year,” said Mario, CEO of Port of Long Beach Cordero.
The Port of Los Angeles expects volumes to be steady in October but increasing in both November and December. Although they are down 19 percent in nine months, Gene Seroka, executive director of the Port of Los Angeles, forecasts they will end the year down 13 percent compared to 2022. It notes that they are currently 12 percent below the five-year running average for the Port of Los Angeles is forecast to handle a total of 8.6 million TEUs in 2023, down from a peak of almost 10.7 million in 2021 r. Notes that the port has the capacity and ability to scale up to meet demand.
Both ports intend to continue rebuilding market share after a year of uncertainty when dockers were without a deal. Analysts point out that Southern California ports could also benefit from the current problems and delays at the Panama Canal, which could encourage shippers to use California ports instead of sending cargo to ports on the East Coast and Gulf Coast.
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Image Source : maritime-executive.com