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NRF Predicts Heavy Impact of Coronavirus
Mar 16, 2020 10:03 AM
By Rapaport News
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RAPAPORT... The impact of the coronavirus on US retail supply chains may be larger than previously expected, as disruptions to transportation are likely to affect imports in March and April, the National Retail Federation (NRF) said.
The NRF was already predicting a sharp drop in imports of goods from mainland China due to factory shutdowns and travel restrictions. However, as the virus spreads, shipments will likely fall even more heavily.
“There are still a lot of unknowns to fully determine the impact of the coronavirus on the supply chain,” Jonathan Gold, NRF vice president for supply chain and customs policy, said last week. “As factories in China continue to come back online, products are now flowing again. But there are still issues affecting cargo movement, including the availability of truck drivers to move cargo to Chinese ports.”
Imports at the US’s major retail container ports are estimated to reach 1.32 million 20-foot equivalent units (TEU) in March, down 18% from the previous year. Before the virus outbreak, NRF’s Global Port Tracker had predicted March imports would reach 1.7 million TEU. It then adjusted this figure to 1.46 million TEU last month as the virus emerged.
April imports, which were not previously expected to be affected by the pandemic, are now forecast at 1.68 million TEU, down 3.5% from last year, and from the 1.82 million TEU the NRF predicted last month.
“Now that we are in the coronavirus environment, uncertainty has expanded exponentially,” noted Ben Hackett, founder of Hackett Associates, which advises the NRF on Global Port Tracker. “Our projections are based on the optimistic view that by the end of March or early April, some sort of normalcy will have returned to trade.”
NRF forecasted May imports would increase 9% year on year to 2.02 million TEU, while June shipments are expected to grow 10% to 1.97 million TEU. Those numbers assume that Chinese factories will have resumed most of their production by that time and will be trying to make up for lower volumes earlier in the year, the federation added.
Meanwhile, 40% of NRF members said they had experienced disruptions in their supply chains from the virus, according to a study by the group, while another 26 respondents expected to see disruptions as the situation continued.
Image: An empty shopping mall. (Shutterstock)
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Tags:
Ben Hackett, Coronavirus, Global Port Tracker, Jonathan Gold, National Retail Federation, NRF, Rapaport News
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