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Major container ports are still expecting a year over year increase in inbound cargo through the first half of 2024, despite a series of attacks on ships in the Red Sea that have disrupted international trade, according to a report from the National Retail Federation and Hackett Associates.
NRF VP for Supply Chain and Customs Policy Jonathan Gold noted in a news release that the situation is helped by the fact that just 12% of US-bound cargo comes through the Suez Canal. He added that US retailers are also working to “mitigate the impact of delays and increased costs,” but this could become more difficult if disruptions continue.
“More needs to be done among partners and allies to ensure the safety of vessels and crews in order to avoid yet another year of supply chain disruption,” he said.
Another mediating factor is that carriers built up surplus capacity in the wake of the pandemic, which is allowing them to divert voyages to the West Coast or around the Cape of Good Hope.
“The shipping industry has rapidly adjusted by adding extra vessels to its networks, and has returned to normal weekly ship arrivals,” Hackett Associates founder Ben Hackett said.
- NRF and Hackett’s Global Port Tracker reported an 8.3% year over year increase in Twenty-Foot Equivalent Units—a common measure of shipping volume—in December. It expects a slowdown in January, but then a 20.4% YoY jump in February.
The disruptions are adding costs for some retailers, however, and certain industries, such as furniture, have been more impacted than others due to where they source products.