Fewer Shipping Containers Arriving at U.S. Ports

Chart of the Month
Written By Jonathan M. Elliott, CPWA®, CRPC®, CDFA®, ChSNC®, CPFA™, RMA®
Shipping containers arriving in Los Angeles

Photo Credit: Barrett Ward, Unsplash

This month's chart explores an alternative dataset, the number of shipping containers entering U.S. ports. The volume of loaded container imports can predict upcoming economic activity, as they represent expected demand for goods, which is closely connected to consumer spending and overall economic growth. Institutional investors, such as hedge funds, frequently use alternative datasets like this one to spot patterns and trends that might not be apparent in conventional economic datasets.

Why are shipping containers relevant?

The chart below shows the total loaded container imports across six major U.S. ports every month for the last five years. 2018 and 2019 establish a pre-pandemic baseline, including seasonal trends, for monthly container imports. Container volumes were average in January 2020 but then plunged in February and March and remained weak for multiple months as the pandemic shut down the global economy. Import volumes rebounded in the second half of 2020 as the economy reopened and remained above average in 2021 as consumers spent heavily on goods. Container volumes peaked in May 2022 but have declined in seven of the last nine months. February 2023’s import volume was the third lowest over the previous five years, behind only February and March 2020 in the early months of the pandemic.

Total Monthly Imports of Loaded Shipping Containers in Thousands

What is the data telling us? Fewer container imports indicate the economy is reverting to pre-pandemic norms. This drop could help alleviate supply chain bottlenecks and ease inflationary pressures, a positive development after inflation rose to a 40-year high during the pandemic. In addition, the decline in container imports may provide insight into upcoming economic trends. Businesses typically import fewer goods when demand is anticipated to decline, and declining imports could indicate that companies expect economic activity to slow.

The question is whether the drop in shipping container volume is related to seasonal trends or the Federal Reserve’s interest rate hikes, designed to ease inflation by reducing demand.

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Jonathan M. Elliott, CPWA®, CRPC®, CDFA®, ChSNC®, CPFA™, RMA®

I am currently the Managing Partner for our independent investment advisory firm, Optima Capital Management. Together with my business partners, Todd Bendell CFP® and Clinton Steinhoff, we founded Optima Capital in 2019 as a forward-thinking wealth management firm that serves as an investment fiduciary and family office for high-net-worth individuals and families. In addition to being the Chief Compliance Officer, my role at Optima Capital is portfolio management. I have over 18 years of experience in managing investment strategies and portfolios. I specialize in using fundamental and technical analysis to build custom portfolios that utilize individual equities, bonds, and exchange-traded funds (ETFs). I began my financial services career with Merrill Lynch in 2003. At Merrill, I served in the leadership roles of Market Sales Manager and Senior Resident Director for the Scottsdale West Valley Market in Arizona. On Wall Street Magazine recognized me as one of the Top 100 Branch Managers in 2017. I am originally from Saginaw, Michigan, and a marketing graduate from the W.P. Carey School of Business at Arizona State University. I am a Certified Private Wealth Advisor® professional. The CPWA® certification program is an advanced credential created specifically for wealth managers who work with high net worth clients, focusing on the life cycle of wealth: accumulation, preservation, and distribution. In addition, I hold the following designations - Chartered Retirement Planning Counselor (CRPC®), Certified Divorce Financial Analyst (CDFA®), Certified Plan Fiduciary Advisor (CPFA), and Retirement Management Advisor (RMA®). In the community, I am a member of the Central Arizona Estate Planning Council (CAEPC) and serve as an alumni advisor and mentor to student organizations at Arizona State University. My interests include traveling, outdoors, fitness, leadership, entrepreneurship, minimalism, and computer science.

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