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Retailers Avoiding West Coast Ports

Retailers Avoiding West Coast Ports

Supply Chain bottlenecks are forcing US retailers to rethink shipping routes, with east and gulf coast ports winning over western gateways, reports Bloomberg.

The number of inbound containers arriving at eastern ports rose nine per cent in the first half of the year compared with the same period in 2021.

Volumes through Houston were up 22 per cent, according to the National Retail Federation. Imports through the west coast were down 0.1 per cent.

Eastern and Gulf gateways for trade boosted their share of Asian imports by five points in the first quarter of 2022 from a year earlier and four points in the second quarter.

“Charleston and Savannah were both very aggressive at sort of wooing us,” said Newell Brands chief financial officer Chris Peterson.

Forty-four per cent of Asian imports enter the country via the east and Gulf coasts, compared with one-quarter in 2008.

It has come at the expense of the west coast, which has fallen to 56 percent from 75 percent during the same period.

Within the next several years, Newell Brands aims to import 50 per cent of its products through east coast ports, including Charleston and Savannah.

The other half will continue to enter through the west coast, down from the current level of 80 per cent.

As a result, Newell is spending US$100 million to refurbish five warehouses and outfit two new ones.

The eastern expansion of US logistics networks is one of many economic trends that the Covid crisis is accelerating.

While much of the shift is temporary, many retail executives declared they plan to stick with the east coast for the long haul.

“We used to think the west coast was the only option,” said Doral director of operations Jose Velez. “The pandemic has opened our eyes to more options.”

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