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2008 Retail Container Traffic to be Lowest Since 2004

“Retail sales forecasts this year are the lowest they’ve been in more than half a decade, and the cargo volume we’re seeing reflects those numbers,” NRF Vice President for Supply Chain and Customs Policy Jonathan Gold said. “The balancing act between supply and demand is tougher than ever because retailers want to make sure they have enough merchandise on the shelves to satisfy customers and not be forced into unplanned markdowns to move excess inventory once the holidays are over.”

U.S. ports surveyed handled 1.33 million TEU in September, the most recent month for which actual numbers are available. The number was down 2.9 percent from August and 9.8 percent from September 2007. October was estimated at 1.36 million TEU, down 5.7 percent from a year ago. If estimates hold true, October will have been the peak shipping month for 2008 but will have fallen significantly short of the 2007 peak of 1.48 million TEU set last September.

November is forecast at 1.26 million TEU, down 8.7 percent, and December is forecast at 1.21 million TEU, down 5.5 percent. January 2009 is forecast at 1.17 million TEU, down 5 percent, and February – traditionally the slowest month of the year – is forecast at 1.12 million TEU, down 8.3 percent. The first year-over-year increase in months is expected in March, which is forecast at 1.18 million TEU, a 2.3 percent increase from March 2008.

Meanwhile, Port Tracker’s congestion rating for the Ports of Los Angeles and Long Beach – the nation’s two largest retail container ports – continues at medium because collection of fees for the new Clean Truck Program there begins this month.

“The October startup of the Clean Truck Program regulations did not cause the disruptions we had been concerned about, but collection of fees for the program begins this month and it is not clear that all trucks will be ready,” IHS Global Insight Economist Paul Bingham said. “Despite that, weak import demand has reduced pressure for port truck drivers, so capacity should be adequate.”

The remainder of the U.S. ports covered by Port Tracker – Oakland, Seattle and Tacoma on the West Coast; New York/New Jersey, Hampton Roads, Charleston and Savannah on the East Coast, and Houston on the Gulf Coast – are rated “low” for congestion, the same as last month.

Port Tracker, which is produced by the economic research, forecasting and analysis firm IHS Global Insight for NRF, 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. The report is free to NRF retail members. Subscription information is available at www.nrf.com/PortTracker or by calling (202) 783-7971. Non-NRF members can contact IHS Global Insight Director of Business Development Diana Wyman at (202) 481-9265.

The National Retail Federation is the world's largest retail trade association, with membership that comprises all retail formats and channels of distribution including department, specialty, discount, catalog, Internet, independent stores, chain restaurants, drug stores and grocery stores as well as the industry's key trading partners of retail goods and services. NRF represents an industry with more than 1.6 million U.S. retail establishments, more than 24 million employees – about one in five American workers – and 2006 sales of $4.7 trillion. As the industry umbrella group, NRF also represents more than 100 state, national and international retail associations. www.nrf.com

IHS Global Insight (www.globalinsight.com ) provides the most comprehensive economic and financial information available on countries, regions and industries, using a unique combination of expertise, models, data and software within a common analytical framework to support planning and decision-making. IHS Global Insight founded the modern economic forecasting industry more than 40 years ago, and today the company is recognized as the most consistently accurate economic forecasting company in the world. Through the world's first same-day analysis and risk assessment service, IHS Global Insight provides immediate insightful analysis of market conditions and key events around the world, covering economic, political, and operational factors. IHS (NYSE: IHS, www.ihs.com )) is a leading global source of critical information and insight that enables innovative and successful decision-making for customers ranging from governments and multinational companies to smaller companies and technical professionals. IHS data and expertise spans four areas of information encompassing the most important concerns facing global business today: Energy, Product Lifecycle, Security and Environment. IHS has been in business since 1959 and employs approximately 3,800 people in 20 countries.

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