US demand for European goods rose 10% in the first quarter, taking volumes back to pre-pandemic levels, while growth in imports from Asia has been accelerating this year, growing 11% in January, 32% in February and 24% in March.
Europe exports to the US in the first quarter of the year were very close to the volumes shipped in 2019 and were just short of the record volume imported in 2021, with March’s figures up 17% on 2023.
Demand and available capacity is well-balanced, with vessel utilisation on the trans-Atlantic westbound near 75% with high, stable rates and contingency surcharges being introduced by some carriers.
Rising rates and demand are likely to continue, which is being welcome by carriers, who last November were describing the trans-Atlantic as a “loss-making trade”.
The National Retail Federation (NRF) expects US imports for the first six months of the year will be up 7.8% compared with the first half of 2023, which is the second month in a row that retailers have raised their forecast for import growth during the first half of 2024.
Economists believe that restocking is under way, following the lengthy de-stocking that saw imports plummet last year, with US imports rising month over month and imports from Asia up 16% year over year.
And, having turned positive last October, the strength of imports goes beyond restocking, with recovery showing in housing and the resurgence of US manufacturing.
Comparing containerised imports at the start of this year with 2023, the top product categories include semiconductors and other electronic components, plastic products, household and institutional furniture, motor vehicle parts and household appliances, which underlines the broad-based nature of the surge in imports.
Inventory replenishment is showing signs of normalising, as retail and wholesale get their inventory-to-sales ratios back to pre-COVID levels, which means that replenishment orders will now be close to parity with sales.
There have already been some initial signs of congestion at Los Angeles and Long Beach resulting from the strong import volumes and, while there have been no vessel backups, rail dwell times rose from 4.7 days in January to 6.3 days in February.
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EMAIL Andy Costara, Global Forwarding UK
EMAIL William Bashford, Global Forwarding EU
EMAIL Adam Davies, Global Forwarding USA
