As the US economy slows down, the competition between the East and West coast ports to be the top trade volume hub intensifies. However, the pie is shrinking as future orders for ocean freight continue to decline. The latest trade data from the Port of New York and New Jersey, the country’s largest container port on the East Coast, shows a slight increase in container processing in March 2023. Nonetheless, the future looks bleak as the global manufacturing PMIs contract, indicating less spending on goods and the need to work down excess inventories.
Port of New York and New Jersey Handles 574,452 TEUs
Despite being the nation’s third-busiest port, the Port of New York and New Jersey handled 574,452 TEUs in March 2023. The difference between the busiest port, the Port of Los Angeles, and the Port of New York/New Jersey, which is the second-busiest port, was 48,781 TEUs in March. In the first three months of 2023, the Port of New York and New Jersey moved almost 1.8 million TEUs, similar to the amount moved during the same period in 2019. However, there is a freight slowdown that has been evident for months and continues to be reflected in the overall activity.
Freight Recession Continues to Affect the Industry
A recent CNBC supply chain survey has shown a decrease in truck movements in and out of warehouses, along with a 40 percent decrease in manufacturing orders, indicating less freight movement by both truck and rail. The trucking industry is said to be in the middle of a “freight recession”, according to JB Hunt’s president Shelley Simpson. The data from FreightWaves SONAR also shows the weakness in the sector. The levels of current ocean freight orders leaving from all ports in the world and arriving at all ports in the United States year over year have decreased by half, affecting both the rails and roads with less freight coming into the country.
In conclusion, the competition between East and West coast ports continues to heat up as the economy softens. The Port of New York and New Jersey remains the country’s third-busiest port, but the future looks bleak as the freight slowdown continues to affect the industry. The decrease in the manufacturing orders foretells less freight movement, and the levels of current ocean freight orders are half of what they were year over year. The decrease in spending on goods and the rise of spending on experiences like travel, leisure, and restaurants is filtering through to the production and transportation of goods.
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