The Port of Long Beach Posts a 7.7% Drop in Container Volumes compared to July 2015. The port attributes the decline to high inventory levels and a slow start to the peak season.
Container volumes at the Port of Long Beach fell 7.7 percent in July compared to the same month in 2015 when harbor terminals handled a record amount of cargo.
Dockworkers moved 637,091 TEUs last month. Inbound containers totaled 325,608 TEUs, a 5.9 percent year-over-year decrease. Outbound containers reached 142,812 TEUs, a slight drop of 0.7 percent from July 2015. Empties decreased to 168,671 TEUs, 15.9 percent lower than July 2015, the port’s strongest July on record.
“Due to continued market uncertainty and high inventory levels, the traditional holiday peak season is off to a slow start and several national forecasts have been revised downward to reflect this softness in cargo movement,” the port said.
Uncertainty Yet Again
There’s that darn uncertainty cropping up again. Mercy.
If it’s any consolation, Economists Expect “Mount Everest” of Uncertainty to Clear Up by December.
However, the peak shipping season will long be over by December.
Concerned parties may also wish to read Comment of the Day Regarding Uncertainty.
Port Blames Inventories
Curiously, the port blamed inventories. The port authorities better get a hold of the Bloomberg Econoday writer pronto. On August 12, Econoday stated that inventories were in “favorable position“, specifically noting the “lean 1.39” inventory-to-sales ratio.
Total Business: Inventory to Sales Ratio
For further discussion, please see Investigating the “Favorably Lean” Position of Inventories.
Shocking Collapse in Services Final Demand
The disappointing news from the Port of Long Beach comes fresh on the heels of a Huge 6% Collapse in PPI Services Final Demand for Apparel, Jewelry, Footwear that had economists shocked.
Cass Freight Index
Truck shipments continue to dive. Shipments in June of 2016 are down vs. June of 2015, 2014, 2013, 2012, 2011, and almost but not quite 2010. Shipments in July are down vs. 2015, 2014, 2012, and 2011.
Here’s a chart I created from Cass Freight Index data.
Intermodal Shipping Also Down
Earlier today I noted Intermodal Shipping Traffic Suffers First Dip in 25 Quarters.
Overall intermodal traffic in North America fell 6.1 percent in second quarter 2016, the first volume decline in 25 consecutive quarters, according to data from the Intermodal Association of North America.
Harper Petersen Shipping Rates Down
Above chart from Harper Petersen.
Shipping Roundup
Retail Sales Flat
Economists missed the mark on retail sales this month by a mile. The Bloomberg Econoday consensus estimate was +0.4% in a range of +0.2% to +0.7%.
Instead of the expected gain, Retail Sales “Solidly” Flat.
Other than the above items, overall manufacturing weakness, and a massive downward revision to real wages from +4.2% to -0.4% (see Pocketbook Theory – Mish vs. Wall Street Journal), 2016 peak season shipping prospects look phenomenal.
Addendum:
The above chart originally stated Cass Index down 5.3% From June the Cass index is actually down 4.3%. About a minute after I made this post, July numbers came out from Cass. From July 2015, traffic is down 2.6% and expenditures down 5.1%.
Mike “Mish” Shedlock
Mish,
Be careful you are going to experience Carpal Tunnel at this rate!
A BRILLIANT, thorough, and truly “fair and balanced” documentary which streams free to Amazon Prime members. One of the best documentaries on any subject I’ve seen in a long time (and I’ve seen a lot of documentaries):
Ghost Exchange (2013)
1 hour, 22 minutes
https://www.amazon.com/dp/B00FX3E5QO
“Wall Street’s leading insiders participate in a startling investigation into the potential systems failure looming for the US Stock Market and the impact of automated trading technology as regulators are challenged to act before its too late.”
Of course, since those profiting from the issues revealed own those who would be the ones to require the proper changes (pols) and, as pointed out in the documentary, those who would be responsible for designing those changes even if mandated by pols don’t have the expertise they require to make well designed changes, nothing will change and wouldn’t change properly even if it did. Still, it’s nice knowing exactly how and why things are so scr***d up.
Is there yet another strike? Last year around this time thw teamster truck drivers struck, then there was a couple of more strikes on in October and later another,, Port traffic was diveryed to Portland and Seattle.
“Anyone claiming that America’s economy is in decline is peddling fiction”
obama, 2016
And the fix?
Trillion dollars per year deficits
Importing millions of illegals and muslims
Zero interest rates
Growing of government
More regulations
Higher taxes
It’s not in decline, it’s in delusion….don’t rock the boat!
When I’m feeling poor I just order more checkbooks and apply for more credit cards. Doesn’t everyone?
Looks like noise to me . I expect downward revisions after the election to GDP. The Fed will then decide to cut the rate again in hopes of stimulating the economy. We are soon to be Japan with rates near zero for as far as the eye can see. Globalization trumps developed economies for at least a generation. As long as the powers that be don’t change anything, we won’t get different results. You’ll get very little…and like it ! Bread and Circus
Airport movements remain at all time record highs and at capacity. LA container shipments are at an all time record high in spite of the opening of the Panama Canal. Wal Mart could do wonders for their business if they adopted Mish’s view of self driving Class 8’s…until then the Trucking industry and the Ship and Barge industry will keep slugging it out in the United States. It’s pretty hard as a truck driver to compete with Dead Weight Tonnage…it really is.
Any decline in imports has just got to be due to our raging domestic economy creating so many more jobs as part of the resurgence of new manufacturing jobs created single handed by Obama (and our money of course). It really is amazing what you can do with a pen and a phone on the golf course.
http://www.theblaze.com/wp-content/uploads/2012/07/urkel1.jpg
The Baltic Dry Index found support earlier this year and then rocketed higher. Harper Petersen’s Shipping Index shows rates as flat this year. What would explain such a difference between rates being high on the BDI but not the Harper Petersen Index? Are ships being used as off-shore storage facilities? And wouldn’t that count as of-the-books inventory since it is not within the US?
Rocketed higher? Take a look at the 5 year and repeat that statement. It is still in a very suppressed state in spite of large numbers of ships pulled from service. And the HARPEX is flat alright – flat at the all-time lows outside of 2009.
Further signals: http://www.financemagnates.com/institutional-forex/execution/dubai-to-become-second-middle-east-clearing-hub-for-chinas-yuan/
Milwaukee natives are restless.
It’s the Panama Canal stupid! The new locks opened June 26 and can handle ships can container ships with 150% more containers than the smaller old locks. I live 800 feet from the Florida East Coast tracks that serve the Port of Miami and rail traffic is noticeably higher. Shippers want to avoid the costly over regulated and labor conflicted LA/LB ports to get closer to the populous East coast and reduce costs. There are at least four other East Coast Portseady for the larger ships. The West coast can no longer exipect to handle 85% of Asian freight. Unless the port costs, regulations and restrictions are reduced, this important economic engine to LA will continue to lose power
One factor I looked at is growth of GDP per capita. It has been essentially zero in the past 7.5 years, if not negative. That is why real wages have dropped and the economy never recovered.