Retail Container Traffic to Fall 11.8 Percent in First Half of 2009

WASHINGTON, February 6, 2009 – After ending 2008 down 7.9 percent, cargo volume at the nation’s major retail container ports is expected to drop at an even faster pace during the first half of 2009 as the economic recession continues, according to the monthly Port Tracker report released today by the National Retail Federation and IHS Global Insight.

Final data for 2008 showed volume for the year at 15.2 million Twenty-Foot-Equivalent Units, compared with 16.5 million TEU in 2007, a decline of 7.9 percent and the lowest total since 2004, when 14 million TEU moved through the ports. One TEU is one 20-foot container or its equivalent.

Volume for the first six months of 2009 is forecast at 6.6 million TEU, down 11.8 percent from the 7.5 million TEU seen during the same period in 2008. Port Tracker forecasts only six months into the future, so an estimate of volume for the entire year won’t be available until this summer.

“2008 was one of the most challenging years retailers have seen, and all indications are that 2009 won’t be any better,” NRF Vice President for Supply Chain and Customs Policy Jonathan Gold said. “Unfortunately, cargo volume at the ports reflects retailers’ anticipated sales, and NRF expects that sales will get worse before they get better. Retailers are only going to import what they can sell.”

U.S. ports surveyed handled 1.06 million TEU in December, the last month for which actual numbers are available. That was down 13.9 percent from November and 17.2 percent from December 2007, and made December the 18th month in a row to see a year-over-year decline. The last month to see a year-over-year increase was July 2007, when the 1.44 million TEU moved through the ports was up 3.4 percent from July 2006.

January was estimated at 1.04 million TEU, down 15.8 percent from January 2008, and February, traditionally the slowest month of the year, is forecast at 1 million TEU, down 18.7 percent from 2008. March is forecast at 1.08 million TEU, down 7 percent from a year earlier, April at 1.14 million TEU, down 10.1 percent; May at 1.16 million TEU, down 11 percent, and June at 1.19 million TEU, down 8.5 percent.

“The combined influence of the recession and the usual winter slowdown will result in extremely weak February port traffic,” IHS Global Insight Economist Paul Bingham said. “Import container traffic is projected to be weak through June because of the underlying reduced demand during the global recession.”

All U.S. ports covered by Port Tracker – Los Angeles/Long Beach, 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 2008 sales of $4.6 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. 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 employs approximately 3,800 people in 20 countries.