SoCal Ports are Optimistic After Solid First Half of 2024
Based on the strength of the U.S. economy and positive momentum, Southern California’s two container ports sounded an optimistic note for the remainder of 2024. Both Los Angeles and Long Beach reported a strong first half of 2024 with increases over 2023 and with Long Beach achieving its strongest June on record.
“We are recapturing market share and consumer spending is driving cargo to our docks as we head into the peak shipping season,” commented Port of Long Beach CEO Mario Cordero. Challenging issues including potential tariff increases and the ongoing labor negotiations at U.S. East and Gulf Coast ports however could also be contributing to the current volume growth as shippers are hedging against the unknown.
Long Beach moved 842,446 TEUs in June making it the busiest port in the U.S. as it reported a better than 41 percent increase in total volume versus last year when the port was experiencing labor challenges in addition to a slowed economy. June 2024 also beat the previous record set in June 2022 by 7,034 TEUs. Year-over-year, imports were up 53 percent and exports also rose four percent last month.
The neighboring Port of Los Angeles also pointed to declining inflation, higher wages, and the strong job market as all contributing to consumer confidence and spending which in turn is driving cargo volumes. Los Angeles Executive Director Gene Seroka described the port’s volume as steady. He noted the strength both at Los Angeles as well as ports across the country.
Los Angeles, however, had a slight decline of one percent in total volume to 827,757 TEU. It however was up 10 percent from a soft May 2024 and capped off what they called a “stellar first half.” Imports in June were up 10 percent month-over-month but off slightly from 2023 while exports were up for the thirteenth consecutive month. They were up 13 percent year-over-year.
Los Angeles handed more than 4.7 million TEU in the first half of 2024, which represents a better than 14 percent increase. They pointed out that the first half also surpassed the five-year moving average for cargo volumes. Long Beach also handled nearly 4.3 million TEU which was up 15 percent over 2023.
“I see modest growth for the second half of 2024 as we strengthen our competitiveness and continue to invest in our rail infrastructure projects that will maximize cargo velocity efficiently and sustainably,” said Cordero. Similarly, Seroka said he thinks the current patterns will continue as the port moves into the third quarter. He forecasted that July will have volumes in the mid-to-upper-800,000 TEU level.
Seroka said he is optimistic for the remainder of 2024. He points out that the Port of Los Angeles is currently operating at 75 to 80 percent of historic capacity providing it room to grow volumes. He points to opportunities to continue to grow export volumes based on the current trade imbalance. With uncertainties and disruptions in supply chains including the backlog at some Asian ports, Seroka said some shippers have said they will consider sending additional cargo through the California ports as a hedge on world issues.