WASHINGTON—Traffic at U.S.-based retail container ports is expected to increase in July and hit a record high in August in the buildup toward the October peak season despite the threat of strike at Los Angeles/Long Beach, according to the monthly Port Tracker Report by the National Retail Federation (NRF) and Global Insight.

The ports surveyed in the report—including Los Angeles/Long Beach, Oakland, Tacoma, Seattle, New York/New Jersey, Hampton Roads, Charleston, and Savannah—handled 1.37 million TEUs in May, the most recent month for which actual numbers are available. May’s total was up 3.3 percent from this April but down 0.2 percent from May 2006. July is expected an increase of 5.4 percent over June on container traffic volumes.

According to the report, a short-term threat of a strike by the IWLU Local 63 office clerical unit workers is looming in Los Angeles/Long Beach. It could affect the ports if contract negotiations are not resolved the Port Tracker states.

“With holidays already scheduled for three days in July, a shutdown due to a strike could cause problems for both ports,” said Global Insight Economist Paul Bingham. “Aside from the situation at LA/Long Beach, the rest of the major retail container ports across the country are operating without congestion from harbor to gate.”

Because of the possible job action, Port Tracker has moved the ports’ congestion rating from low to moderate. “These are the nation’s two largest retail container ports, and retailers will be watching this situation very closely,” NRF Vice President and International Trade Counsel Erik Autor said in a press release.

Rail: Traffic decline
The overall rail traffic continues to decline this year, according to the Port Tracker Report. Inter modal rail volume growth is slower than volume growth in 2006, as reported by the Association of American Railroads (AAR). During the week ended June 16, U.S. inter modal volumes were down 2.3%.

According to AAR, railroad service metrics continued to slip in June. The industry average for U.S. Class 1 train speeds was down approximately 1.3 percent, as opposed to the speeds in June 2006. Train speeds for CN, CPR, and KCS were below last year's levels, with KCS having the most significant drop, down 17.2 percent from June 2006.

Truck: Fuel price up
The average national price of retail diesel fuel price was up 3.0 percent in June, as reported by the U.S. Department of Energy (DOE). At 3.2 percent increase, the Midwest has the highest regional price increase rate. Analysts have speculated that a substantial increase in the gasoline production volumes will be seen once refinery utilization returns to normal rates for this time of year.

Updated: July 9, 2007