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Hurricane Impacts Not Slowing Shipping: NRF and Global Insight

WASHINGTON -- Despite recent hurricanes, congestion levels are low and cargo is flowing smoothly at the nation's major retail container ports, as merchants move into the peak shipping cycle for the annual holiday sales season, according to the October "Port Tracker" report, released yesterday by the National Retail Federation and Global Insight.

"This is good news, especially when you compare it to the labor shortages, shutdowns, and other problems we've seen in recent years," NRF's v.p. and international trade counsel Erik Autor said in a statement. "Holiday sales make up one-fifth of the retail industry's revenue for the entire year, so this is the most crucial shipping cycle we face."

The ports are in good condition, agreed Global Insight's principal economist Paul Bingham. "Transportation providers and shippers have made decisions that have reduced the pressure on the system compared with a year ago. Despite the disruptions to the national system from the hurricanes in the Gulf Coast, the risk of congestion now appears lower than we were concerned with last month. The slower overall growth in container volume has also contributed to this situation."

The September "Port Tracker" Report gave the ports of Los Angeles/Long Beach and Oakland a medium congestion rating out of concern that Gulf Coast damage from Hurricane Katrina would require railroad rerouting that would slow down trains taking cargo away from other ports. Despite extensive local damage in the Gulf Region, the impact of August's Hurricane Katrina and September's Hurricane Rita on the national rail system turned out to be relatively modest. Consequently, LA/Long Beach and Oakland's congestion rating was back at low this month. The remaining ports covered by "Port Tracker" -- Tacoma, Wash.; Seattle; New York/New Jersey; Hampton Roads, Va.; Charleston, S.C.; and Savannah, Ga. -- were also ranked low, with none at medium or high.

"Port Tracker," which is produced by the economic research, forecasting, and analysis firm Global Insight for NRF, was developed in response to severe port congestion experienced in 2004, particularly at West Coast ports, and other recent port disruptions that have threatened the retail industry's supply of imported merchandise. The report looks at inbound container volume, the availability of trucks and railroad cars to move cargo out of the ports, labor conditions, and other factors that affect cargo movement and congestion.
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