Container volumes in the Los Angeles-Long Beach port complex declined in March compared to March 2012, as expected, because of an 18 percent drop in imports following the Chinese New Year celebrations in Asia.
However, the nation’s largest port complex had a strong first quarter, with total container volumes, including loaded imports, loaded exports and empty containers, increasing 5 percent over the first three months of 2012.
Containerized imports in March declined 18 percent, exports dropped 7 percent and total container volume in the port complex fell 11 percent compared to March 2012, according to numbers published on the ports’ Web sites.
Loaded import containers in Long Beach declined 0.5 percent in March, while imports in Los Angeles dropped 28.8 percent. March was weak for both ports because it was measured against a strong March in 2012. By contrast, Long Beach and Los Angeles had a strong February, as that month’s performance was compared to a weak February in 2012.
February and March are volatile months in the eastbound trans-Pacific trade because they reflect manufacturing activity in China and other Asian nations that celebrate the Lunar New Year. Factories throughout the region close for a week or two during the celebrations, and exports to North America plummet during the festivities.
Last year, Chinese New Year was earlier on the calendar, so February was a slow month for U.S. imports from Asia. With Lunar New Year later this year, March turned out to be weaker compared to March 2012.
Those fluctuations smooth out when the first quarter results are calculated, and the Southern California port complex performed better this year than last. Containerized imports increased 6 percent, exports dropped 1 percent and total container volume, including the repositioning of empty containers in Asia, increased 5 percent compared to the first three months of 2012.
Exports continue to underperform because of the economic recession in Europe and the impact of Europe’s woes on Asian economies. Exports in Los Angeles-Long Beach declined 11 percent in March, and exports in the port complex were down 1 percent in the first quarter compared to the same period last year.
However, the increase in imports in the first quarter, which reflects the strengthening U.S. economy, is good news for ocean carriers in the eastbound Pacific. The eastbound trade from Asia to the U.S. is the head-haul trade lane, and carriers deploy vessel capacity based on projected cargo volumes in that direction. Carriers in 2013 are expected to increase capacity 5.5 percent in the Pacific, according to a report this week from Drewry consultants in London.
Carriers this year are expected to take delivery of 40 vessels with capacities of 10,000 20-foot containers or larger. While the biggest vessels — which will range up to the 18,000-TEU ships to be delivered to Maersk Line — are normally entered into the Asia-Europe trade, those mega-ships displace rather large vessels that are normally deployed in the trans-Pacific routes to the West Coast.
Los Angeles and Long Beach anticipate a slew of large vessels this year. Vessels of 8,000-TEU capacity are common, and ships of 10,000- to 13,000-TEU capacity are now being deployed to Southern California.
Long Beach has been a direct beneficiary of the large ships as two carriers late last year took an equity stake in marine terminals at the port. Mediterranean Shipping Co. and CMA CGM now call regularly at the Port of Long Beach with big ships.
That development also represented a loss of some volume for Los Angeles. It is therefore likely that for much of 2013 Long Beach will report strong growth compared to the same months in 2012, whereas gains in Los Angeles will be more modest.